Ministerial dispute forces delay to White Paper on pensions reform

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The Independent Online

The Government's White Paper on pensions reform is unlikely to be published before the summer, because of a continuing disagreement between the Treasury and the Secretary of State for Work and Pensions, John Hutton, over the timing and extent of the reforms.

The Department for Work and Pensions had hoped to publish the paper next month. However, the dispute between Gordon Brown and Mr Hutton has not only pushed back the delivery date but also looks set to ensure the paper contains few firm proposals.

Christine Farnish, the chief executive of the National Association of Pension Funds, said yesterday she expected it to be a "fairly Green White Paper" but added the delay could help prevent the Government from making any hasty decisions on such an important area of policy.

The only issue on which the two departments are thought to have reached a consensus is the plan to raise the retirement age to 66 in 2030. The White Paper is also expected to follow up Lord Turner's suggestion to form a permanent independent body to review the state pension retirement age.

An agreement has not been met on whether to follow Lord Turner's proposal to create a National Pensions Savings Scheme (NPSS), into which all employees would be auto-enrolled and all employers would be compelled to contribute 3 per cent of salary a year.

Lord Turner publishes an update to his December Pensions Commission report on Tuesday, when he will produce more detailed calculations on the running costs of his NPSS proposals. He is expected to explain why he believes the alternative models proposed are not the way forward.