Commentators and trade bodies, from Adair Turner to the Association of British Insurers (ABI), have argued that the British people are saving insufficient amounts for their future pensions. The ABI, for example, has estimated there is a £27bn a year shortfall for pension provision. Adair Turners Pensions Commission used this argument to justify the view that the public does not treat pensions savings rationally.
Congdon argues that these views are flawed at a basic level as they consider only pensions saving and not overall saving. Ultimately all saving must be drawn down in retirement or passed on to relatives as a bequest. However, it does not follow that we will save for our future pensions using formal pensions vehicles. Changes in regulation, the tax tre