Personal Accounts
From Wikipedia, the free encyclopedia
Personal Accounts are a proposed new pension system for all workers in the United Kingdom that do not already have a good company pension scheme.
Proposed in the Blair Government's Pensions White Paper of May 2006, they are planned to be set up and running by 2012.
All employees will be automatically enrolled into the system, unless they opt out. Employers will deduct pension contributions from the employee's pay at the rate of 4% of salary between £5000pa and £33,000pa. To this, employers must add a compulsory contribution of 3%. The Government will add a further 1% by way of tax relief.
The concept was originally invented by the Pensions Commission, and documented in their Second Report, published in November 2006, under the title of National Pensions Savings Scheme. As the Government have taken the idea forward to delivery, they have changed the name to Personal Accounts.
