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New name for personal accounts scheme

New name for personal accounts scheme

Category: Pensions

Updated: 08/01/2010
First Published: 08/01/2010

MONEYFACTS ARCHIVE
This article was correct at the time of publication. It is now over 6 months old so the content may be out of date.

The new national workplace pension programme formerly known as the personal accounts scheme will know be known as the National Employment Savings Trust (NEST).

NEST will be a national workplace pension scheme designed specifically for low to moderate earners and is part of the Government's workplace pension reforms, which it hopes will go some way to easing the current crisis in the sector.

The initiative will be one of the options available to employers when auto-enrolment is phased in during 2012, although NEST will be launched in low volumes in 2011.

"The reforms to UK workplace pensions, including NEST, represent a consensus settlement reached across industry, political parties and interest groups," commented Jennie Drake, Acting Chair for the Personal Accounts Delivery Authority.

"We all have one goal in mind - to make saving for retirement become the norm and to put an end to poverty in old age. The release of the new brand today is another milestone along the way to achieving one of the biggest social reforms of our generation."

The Association of British Insurers said it hoped the new brand would strike a chord with customers and that it should be used to make people more aware of pension savings, allowing them to build up a real nest egg for retirement.

Under the new workplace pension reforms, employers will have to contribute three per cent on a band of earnings, although more is permitted.

The minimum contribution for eligible workers must be eight per cent of earnings, although this is made up of employer's contribution, tax relief and worker's contribution.

To help adjustments to the costs, from October 2012 contributions will be phased in for both employers and employees starting at one per cent and increasing to minimum levels.

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