The British government launched a major pensions review to a broad industry welcome this summer, with commentators expressing hope that a consensus can be achieved on how to extend coverage.

Announcing the review, Social Se-curity Secretary, Harriet Harman plac-ed the initiative firmly in the context of 'new' Labour economic thinking.

Our starting point must be the health and success of the wider economy," she said, "By establishing the conditions for stable, sustainable growth, we will build a stronger economy and provide the essential foundations for decent and secure pensions."

The review will put flesh on the bones of government promises to set up a new 'Stake-holder' pension on top of commitments to retain current state provision, and, for those who wish to retain it, the State Earnings Relation Pension Scheme.

Harman described the new Stakeholder pension as "offering secure, flexible and value-for-money second pensions for those who cannot join an employer's scheme whose pay is low or intermittent, and for whom personal pensions are usually unsuitable."

She also raised the prospect of a citizen's pensions for full-time carers who currently end up on means tested benefits when they retire.

Harman set out nine challenges for the review, namely to achieve consensus, to agree the funding balance be-tween public and private provision, to respond to demographic and social and labour market change, to ensure maximum return on resources, to ach-ieve the correct regulatory balance, to raise awareness and improve financial education, to narrow the pensions gap between men and women and to strike a balance between the generations particularly with regard to financing.

It is not just the government that is seeking a consensus with both the Pensions Management Institute and consultants Sedgwick Noble Lowndes emphasising the benefits of political consensus.

Sedgwick's practice director in London, Richard Malone said: "The last time a Labour government undertook such a far-reaching review in 1978, they managed to achieve a consensus among all the main political parties of the time. If they can do it again it would be a great day for pension planning in this country."

An expert panel advising Pensions Minister, John Denham on the current state of pensions provision will be chaired by the National Association of Pension Funds (NAPF) vice president Tom Ross, a director with consultants Alexander Clay.

Ann Robinson, director general of NAPF, welcomed his appointment and added: "We recognise that it would not be wise for the UK to continue with the current system in which half the working population have ac-cess to good quality occupational pensions schemes while the remainder are generally not saving enough, if at all."

The government may seek to extend pension coverage through industry-wide schemes and Denham will take part in a conference organised by Hartshead Solway - a specialist in the design of such plans - on November 19. This conference will be chaired by Ross. However the company has ex-pressed doubts about an increase in participation in such schemes without an element of compulsion.

Nick Wheeler, marketing director, said: "With the right framework, we can pull administrative costs down to as low as £2.50 to £3.00 per month. The real difficulty is to hold down marketing costs, particularly if scheme membership remains entirely voluntary."

John Lappin"

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