Pension payments to be privatised?

News


11 Feb, 2014

Pension payments to be privatised? 

According to a government document from the Department for Work and Pensions, the DWP Efficiency Review, it seems private companies will be pushed to oversee pension payments as part of the plan to drive down the costs of distributing benefits and tax credits. This should make up billions in austerity savings.

The Guardian has claimed that Whitehall’s biggest department is facing an “unprecedented reform challenge” as it tries to locate the £2 billion in savings that it requires.

There are currently strategic shifts being made, such as in the case of the re-evaluation of state pension management for over-65s, which are due to revive the ailing pensions system. Saving money is crucial to bring state pensions back from the brink.

However, this move to bring in firms such as Capita, Serco or G4S to handle the £100?billion in public money that is paid out to pensioners has raised other very significant concerns. In fact, pensions expert Ros Altmann reacted immediately to the news of the document expressing “serious” issues with the idea. Altman said a private firm would likely save money by reducing the pay and conditions of staff or the quality of the service, and charges could go up in the end.