Govt's pension plans 'will have big impact on retirees'

Plans announced by the government concerning private sector pensions will have a considerable impact on the finances of retirees, it has been claimed.

Recently, the Conservative/Liberal Democrat coalition released details of proposals to shift the measure of inflation used to calculate private sector pension payments from the retail prices index to the consumer prices index.

Pensions minister Steve Webb was the politician fronting the new policy, and the claims followed comments made last month by the new administration that it was to reform and repair Britain's "outdated and inadequate" pension system.

Responding to the development, industry practitioner Keith Churchouse said that despite the fact that the alteration may not appear that dramatic, in fact it will make a "huge difference" to retirees.

He added: "It is something that individual people will really need to start paying attention to early, because the reality is that they're going to see the purchasing benefits of their pensions going down over time."