The Confederation of British Industry (CBI) has urged more employers to offer pension schemes to employees and called on the government to raise the retirement age to 70, in order to combat the pensions crisis.
In a new report, the business lobby group said that the government should do more to encourage small firms to provide pensions for their workers.
The CBI stated that every business that can afford to make a pension contribution should do so, but ministers should reduce the regulatory and tax burden involved in setting up schemes.
Along with an increase to the state pension, the CBI said that the retirement age should gradually rise from 65 to 70, to help ease to pressure on the system.
Although the CBI remains opposed to compulsory pension contributions from employers, the organisation admitted that firms needed to do more to provide for the growing elderly workforce.
Many small businesses, who cannot afford to administer pension schemes, have been concerned by trade union pressure on the government to force employers to pay out contributions.
The CBI’s proposal to raise the retirement age to 70 will be welcomed more favourably by small employers, with firms benefiting from longer service from sought-after skilled and experienced workers.
Richard Greenhalgh, of the CBI, insisted that businesses were committed to providing pensions to staff.
“Few people appreciate the extreme pressure companies have been under – businesses will have to make £6 billion worth of additional pension payments in each of the next three years.
“The UK’s voluntary approach must be invigorated and we are confident it can be. That means employers, government and individuals recommitting to pensions and each accepting their responsibilities,” he said.
