Tomorrow's pensioners could face poverty if changes are not made

MPs looking into state of the UK's pensions called on the government to say how it would make sure private pensions were adequately protected.

In its report on the future of pensions, the Work and Pensions Select Committee concluded there was not a pensions crisis, merely a crisis of confidence.

It said provision in the UK was at a turning point - and decisions needed to be made now by the government.

'Poverty'

According to industry observers, including the Association of British Insurers, private pension provision is still being neglected.

This leaves tomorrow's pensioners in danger of facing poverty instead of enjoying a comfortable retirement.

The report falls short of calling for the introduction of compulsory savings.

Instead, it suggests a system where workers' contributions to a personal scheme are bolstered with money from the government instead of tax relief.

In Depth: pensions crisis

Extending the retirement age beyond 65 is dismissed - for the time being.

"We believe that at the present time the state pension age should not be increased beyond 65.

"However, we believe it would be prudent to keep this issue under review," the report said.

Instead, MPs suggested the government consider asking employers to insist new workers joined a scheme as part of their terms of employment.

The report said the present system had a number of weaknesses, such as complexity, too much pensioner poverty and lack of security of private pension funds.

But, it said: "Despite these weaknesses, the UK system as a whole is basically sound."

The study has been criticised by Help the Aged for not providing a road map for the problems it sets out, while the Equal Opportunities Commission has said it ignores women.