Skip to main content
The Actuary: The magazine of the Institute and Faculty of Actuaries - return to the homepage Logo of The Actuary website
  • Search
  • Visit The Actuary Magazine on Facebook
  • Visit The Actuary Magazine on LinkedIn
  • Visit @TheActuaryMag on Twitter
Visit the website of the Institute and Faculty of Actuaries Logo of the Institute and Faculty of Actuaries

Main navigation

  • News
  • Features
    • General Features
    • Interviews
    • Students
    • Opinion
  • Topics
  • Knowledge
    • Business Skills
    • Careers
    • Events
    • Predictions by The Actuary
    • Whitepapers
  • Jobs
  • IFoA
    • CEO Comment
    • IFoA News
    • People & Social News
    • President Comment
  • Archive
Quick links:
  • Home
  • The Actuary Issues
  • October 2013
10

'Re-shape' pensions to fund care, say legal experts

Open-access content Thursday 3rd October 2013

Pension schemes should be reformed to allow savers to earmark part of their entitlement in advance of retirement to pay for care, a law firm has recommended

Lawyers Squire Sanders said the government's plan to introduce a cap on an individual's social care costs - set at £72,000 from 2016 - was intended to allow the pension and insurance industry to design products to pay up to the cap.

A report published today, In sickness and in health: reforming pensions and social care, said the pensions industry could indeed support the reforms by providing products. 

However, the current savings system would need to be 're-shaped' to ensure that incentives are in place for people to save.

It recommended that the government introduce 'more flexibility' in the existing pension tax reliefs so that unused reliefs and allowances could be ported between savings plans - for example between a pension scheme and a care scheme - and between couples. 

Pension savers should be able to split and defer their tax-free lump sum entitlements within the same plan to provide for care. 

Catherine McKenna, leader of Squire Sanders' pensions practice group, stated that more than 80% of people aged over 65 would require some form of care and support, according to the government's own figures.

'The UK government has laid out a cap on lifetime contributions to adult social care costs in the current Care Bill,' she said. 

'Even so, funding solutions need to be found to meet the costs of care and the government has challenged the pensions and insurance industry to find them.'

McKenna said that, if the government was serious about supporting funding for care, it had three main options. 

These were: to provide extra tax incentives to save for care; compel people to save; or to re-shape both pensions and tax legislation to allow people to make individual choices.

Only the last of these is a viable solution, she added. 'The structural barriers can and should be overcome to make pensions flexible enough for individuals to provide for their care, both in sickness and in health.'

This article appeared in our October 2013 issue of The Actuary.
Click here to view this issue
Filed in:
10
Topics:
Health care

You might also like...

Share
  • Twitter
  • Facebook
  • Linked in
  • Mail
  • Print

Latest Jobs

Syndicate - Senior Actuarial Analyst - Reserving

London (Central)
£40000 - £65000 per annum + benefits
Reference
121016

Senior Actuarial Analyst - Commercial Lines - Reserving

London (Central)
£40000 - £60000 per annum + benefits
Reference
121015

Pricing Actuarial Analyst - Lloyd's

London (Central)
£40000 - £60000 per annum + benefits
Reference
121014
See all jobs »
 
 

Today's top reads

 
 

Sign up to our newsletter

News, jobs and updates

Sign up

Subscribe to The Actuary

Receive the print edition straight to your door

Subscribe
Spread-iPad-slantB-june.png

Topics

  • Data Science
  • Investment
  • Risk & ERM
  • Pensions
  • Environment
  • Soft skills
  • General Insurance
  • Regulation Standards
  • Health care
  • Technology
  • Reinsurance
  • Global
  • Life insurance
​
FOLLOW US
The Actuary on LinkedIn
@TheActuaryMag on Twitter
Facebook: The Actuary Magazine
CONTACT US
The Actuary
Tel: (+44) 020 7880 6200
​

IFoA

About IFoA
Become an actuary
IFoA Events
About membership

Information

Privacy Policy
Terms & Conditions
Cookie Policy
Think Green

Get in touch

Contact us
Advertise with us
Subscribe to The Actuary Magazine
Contribute

The Actuary Jobs

Actuarial job search
Pensions jobs
General insurance jobs
Solvency II jobs

© 2021 The Actuary. The Actuary is published on behalf of the Institute and Faculty of Actuaries by Redactive Publishing Limited, Level 5, 78 Chamber Street, London, E1 8BL. Tel: 020 7880 6200