Public Acceptability . It was grudgingly prepared to allow company schemes to opt out of the State Earnings Related Pension scheme. But it was critical both of the principle and the practice of allowing individuals to opt out of the state scheme into personal pensions. The emergence of the misselling problem and the Maxwell scandal gave them ammunition to fire at private funded pension provision. Despite that, the growing public popularity of private pension provision, coupled with increasing awareness of its long-term benefit to the public finances brought a gradual change of heart.
Labour now plans to encourage more people to build up private funded pensions.
Proposals to Extend Private Provision of Pensions . Before the last election Conservatives were seeking ways to extend private pension provision. In the late 1980s we gave members of company schemes the right to save more than the standard amounts required by the company. Employees could make Additional Voluntary Contributions into their fund up to a certain amount out of income tax free. The then government also consulted on the idea of closing the State Earnings Related Pension Scheme.