BOSSES today came out in favour of a revamped second state pension to help low-paid workers to a more comfortable retirement.
The Confederation of British Industry said reform of the second state pension could increase the retirement income of someone earning £20,000 by up to £2,000 a year.
It is to submit its argument to the Pensions Commission, which has already said 12m people are not saving enough for their old age. The commission is due to release its final report later this year.
The CBI warns that low- er-earning employees in smaller businesses without pensions schemes are most at risk of an inadequate pension in old age.
The CBI believes a refor- med second state pension would offer lower-cost saving options to the low-paid, acting as a savings top-up linked to earnings, to supplement the basic state pension. Such a scheme could be:
* Run by the state but invested by existing private-sector experts.
* Based on a system of defined contributions that are linked to earnings.
* Aimed at those who do not have access to occupational pension provision.
