An increasing need to focus on compliance is leaving the traditional drivers of retirement benefits lagging behind in employers' priorities.
That was the conclusion of Towers Watson's Fit for Retirement report, which surveyed over 100 companies in March to discover the impact that recent pensions changes have had on their pension plan priorities.

Some 56% claimed that compliance was one of their top DC pension priorities.

Only 38% of companies named their workers' ability to retire as a top priority and even fewer listed competitiveness (31%) and attraction and retention (30%) as a driver of pension provision.

Phil Percival, head of Towers Watson's FiT Age programme, said: "Currently compliance is crowding out employers' ability to focus on retirement adequacy.

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"This is perhaps not surprising given the barrage of changes the industry has seen in the last decade including the introduction and subsequent reductions of the annual and lifetime allowances, greater focus on governance, auto enrolment, the end of contracting-out and now the new DC pension reforms.

"Such a flurry of change is preventing companies from focusing on the real reason for providing pension plans – either for the employer, in terms of attraction and retention, or for the employee in terms of their ability to retire."

The authors of the report said that by contrast, in the US where pension regulations have been more stable, compliance was found to be the lowest priority for employers.

The survey found UK employers were hoping to reduce their emphasis on compliance and bring the focus back to providing more effective pensions.

When asked to list what they think their organisation's main pensions objective will be in the future, workers' ability to retire and competitiveness were listed by nearly 60% of companies, while just one-in-five claimed they would still be focusing on compliance.

The research raises concerns that with few companies focusing on ensuring their employees have adequate pension provisions, many employees will realise too late that they are unable to retire when they originally intended and will have to remain in the workplace longer.

Mr Percival believes that this can impact employers in terms of workforce planning, benefit costs and succession planning.