UK - The UK government has denied suggestions that Britain is facing a pensions and savings crisis, responding to questions in the House of Lords.

Lord McIntosh, government spokesman in the House of Lords said the current savings ratio was 6.1% against a long term average of 8.1%. He was replying to Lord Higgins claimed the savings ratio had almost halved under the present labour government “There is a crisis, which is in danger of turning into a disaster.

Lord McIntosh said that Lord Higgins’ calculation of the saving ratio was wrong: “ The rate has gone down but is still close enough to the long-term average not to be a crisis or a disaster. Of course there are savings problems but they are not a crisis and they are not a disaster.”

He also rebutted the suggestions of Lord Jenkins of Roding, former Conservative Trade and Industry minister, that the I% charge cap on stakeholder pensions was too low to allow pension providers to remain solvent

He said 1.5m stakeholder pensions had been sold “Rather than cutting down on the benefits of low cost scheme such as stakeholder, it is our intention, following the Sandler report, to bring the stakeholder pension scheme into what is called the Sandler site. In other words to extend the range of low cost producers which are to the benefit of savers and investors.”

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