NPSS in five years: Turner

Ahead of the publication of the UK government's White Paper on pension reform, Adair Turner said that he expected a version of the National Pensions Savings Scheme (NPSS), outlined in the Pension Commission's report, to be in place by 2011.

The Commission's report, published in November last year, recommended the creation of a national managed pensions savings scheme, with auto-enrolment and bulk-bought low management fees and the restoration of the link between pensions and earnings.

"I hope that the imminent White Paper will include a commitment to reform of the State pension system, and I think there is a broad consensus of opinion, among all interested parties that this needs to be done," Turner told Life & Pensions.

"But whatever the exact contents of the paper, I think that we will have a variant of the NPSS system that was outlined in the report - by that I mean an auto-enrolled system with individual savings accounts - within five years."

In a previous interview with Life & Pensions in 2005, Turner was scathing over the potential role for the UK's insurance industry in providing pensions for low income groups, but his attitude to industry has now softened.

Following a series of high profile and costly failures by the UK government in implementing large scale IT schemes there has been a widespread scepticism over Turner's plan for a giant State-run pension scheme - and this criticism has been taken on board.

"This is clearly the biggest argument in favour of the alternatives. But even if we keep with a State-run scheme, then there is potential to reduce operational risk by building directly on existing infrastructure - or by outsourcing some of the requirement to the insurance sector."