The state pension could soon be privatised, under new government plans.

In an effort to make up billions more in austerity savings, the Department for Work and Pensions (DWP) has launched a review into how it issues pension statements each year.

The report – which is entitled DWP Efficiency Review, runs to over 80 pages and is marked “restricted” – also considers how to make cost savings in the way the DWP handles three quarters of a million phone calls and the distribution of £98 billion in benefits and tax credits.

One of the proposals it has made in relation to that is to allow private companies to take over some of the management of the state pensions. This could see private companies such as Serco, Capita or G4S take over the management of aspects of the state pension.

Of course, if some of the services are privatised, it then paves the way for the entire pensions service to be privatised.

The chair of the Commons work and pensions committee, Labour’s Dame Anne Begg, said she was against privatisation.

She added: “The pension service is one of the success stories of the DWP. There is a very high satisfaction rate and very few complaints about it. [So] if it’s a success story and it ain’t broke I’m not sure why they would want to upset that.
“If you’re saving money, it’s coming from somewhere. And if you end up with a poorer service as a result then it’s not good value for the taxpayer.”
The right-leaning thinktank the Institute of Economic Affairs said it welcomed an overhaul in how the state pension was delivered and how it was funded.

This year, small businesses will be required to auto-enrol all of their employees into a company pension scheme.

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