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Last Updated: Thursday, 26 October 2006, 08:42 GMT 09:42 UK
Government drops pension planner
By Rachel Spring
BBC Social Affairs analyst

 DWP pension forecast service guide
DWP guidance for employers who provide combined pension forecasts
After four years of development, the government has suspended its plans for an internet retirement planner.

No date has been set to restart work on the proposed service, which was aimed at people on low to middle incomes.

The online planner was intended to give help to those without easy access to financial advice.

It would have provided them with individualised state and private pension forecasts, and offered advice on how to boost their pensions.

Although 11 million had been spent on the website, halting the work will save the government an estimated 14 million.

According to the Minister for Pensions Reform, James Purnell, the work on the site was halted when the Department for Work and Pensions realised that "delivering accurate online information about state pensions would become increasingly difficult, given the uncertainty about the exact shape of future pension provision".

Pension forecasts

The online retirement planner was first proposed in 2002.

DWP pension service online state forecast
Online state forecast from the DWP pension service

The original intention was to allow people to view their total projected pension income based on how much they planned to work and save before retirement.

The website would also have calculated any savings shortfall, illustrated options for addressing any shortfall and offered a facility to enable people to trace old pensions.

The first element of the service, the provision of online state pension forecasts, was launched in 2004.

This service now comes with the warning that the forecast is based on the current law, but that changes designed to increase the number of people who would become eligible for a state pension may affect entitlement.

A user-friendly site combining both state and private entitlements was not thought possible during a period in which the pension system is undergoing radical reform.

The government announced in May its intention to reduce the number of years required to qualify for a state pension, increase the state pension age to 68 by 2046, restore the earnings link for the basic state pension and introduce a National Pensions Savings Scheme.

A Pensions Bill is expected in the next session of Parliament.

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