Jackson national life insurance co.

Mr Turner said people on low incomes feared that saving would bar them from receiving benefits such as the Pension Credit.

Complexity and high charges were also putting as many as 12 million people off saving for , he said.

In October, the Commission warned that the UK faced a pension black hole.

At the time, Mr Turner said a mix of higher taxes, more saving and a higher average retirement age was needed to solve the UK’s pension crisis.

Certainty there are some people whose rational incentive to save is impacted by means testing Adair Turner, Pensions Commission

Benefit impact

Mr Turner was appearing in front of the Work and Pensions Committee along with fellow commissioners Jeannie Drake and John Hills.

MPs pressed the commissioners on the possible negative impact of means testing on the UK’s savings culture.

Mr Turner said that if means testing continued to be extended, large swathes of the UK population would be claiming some form of benefit or tax credit.

He was not criticising means testing in principle, he said. But it was proving a “barrier” to saving.

“Certainty there are some people whose rational incentive to save is impacted by means testing,” Mr Turner told MPs.

Mr Turner added that financial advisers were put off advising clients on low incomes to start a pension for fear of facing future accusations of mis-selling.

Financial advisers feared that the expansion of means testing could mean that clients would have their savings cancelled out by cuts in benefit.

Poorer pensioners

The Pensions Commission was asked in 2002 to look into the state of UK retirement provision.

In October, it produced a report outlining the scale of the UK’s pension crisis.

The state pension is expected to get smaller and smaller

The UK’s ageing population means that, in future years, taxpayers will have to support an increasing number of over-65s through the state pension.

The interim report said that society and individuals must choose a mix of four options including:

• Pensioners becoming poorer relative to the rest of society

• Taxes/National Insurance contributions devoted to pensions rising

• Savings rising

• Average retirement ages rising

The Pensions Commission will produce a final report next autumn, which will outline in greater detail its recommendations for overcoming the UK’s pension crisis.

When asked by MPs if he would bring forward the publication of his report Mr Turner said it was “More important to get out recommendations right rather than early”.

The Pensions Policy Institute (PPI) said replacing the state pension with a “citizen’s pension” would help tackle inequality and .

The change would see pensions being calculated on length of residency in the UK rather than National Insurance (NI) contributions.

Reform could reduce poverty by aiding people with broken records.

Compulsion

The PPI added that once the state system was reformed the should look at options to overhaul private and workplace pensions.

The think tank’s proposals were made in response to the recent of the Pensions Commission’s initial report into UK retirement savings.

According to the Pensions Commission’s report 12 million working people are not saving enough for their retirement.

As a result, living standards could fall for the next generation of UK .

The report added that a combination of higher taxes, higher savings and/or a higher average retirement age was needed to solve the UK pension crisis.

So far, 63,000 has been paid to six companies, saving 234 workers from being laid off.

The government has said a total of 40m in grants would be made available to support businesses who supplied Rover.

There was more bad news for Rover on Thursday after its cars did badly in a league table of driver satisfaction.

Rover was ranked 28th out of 32 car in a survey of 20,000 car owners carried out by market information company JD Power and What Car? magazine.

Only Land Rover, Peugeot, Fiat and Alfa Romeo came below Rover. Top of the table were Lexus, Skoda and Honda.

Staying alive

We know of firms where 85% of their business is supplying Rover… it’s hard for them to see a future John Edwards, chief executive of Advantage West Midlands Rover user satisfaction low

While the task force payments may have saved jobs for the time being at the six firms, other suppliers are still warning that they may have to lay off workers.

John Edwards, a member of the task force and chief executive of Advantage West Midlands, said that helping companies which are heavily dependent on Rover for most of their work could be more difficult than helping those which are more diversified.

“We have to target those companies, which with some support, can survive,” he told BBC Radio 4’s Today programme.

“We know of firms where 85% of their business is supplying Rover. In these , it is hard for them to see a future for themselves.

“We are talking to government about (the possibility of) deferring VAT and National Insurance payments… but it is very difficult.”

Moving forward

According to Advantage West Midlands, some of the 40m available for grants could be used to assist residents near Longbridge who are affected by the problems there - for example, shops that serve Rover workers.

Separately, The Times newspaper reported that the government has set aside 25m to keep MG Rover afloat if Shanghai Automotive Industry (SAIC) resumes talks about investing in the car firm.

The extra government funds could keep the troubled car firm going until the election on 5 May, the newspaper said. The government has already offered a 6.5m loan to keep Rover going this week.

The DTI said that talk of a further 25m was “pure speculation.” But it added that it would be meeting later this week to consider future funding .

PricewaterhouseCoopers, the administrator for MG Rover, is said to want to put forward a new plan to SAIC, but doubts remain over how enthusiastic the Chinese firm will be to revive the deal.

The Paxman Interviews do exactly what the title says.

There are no audiences, no phone-ins, no sofa, no young Ant and Dec. Just Jeremy Paxman doing what he does best with each of the party leaders in turn, in three specials.

The half-hour will run at 1930 BST on BBC One, with another chance to see the best bits on Newsnight in its normal slot on BBC Two at 2230 BST.

Searching questions

First up on Monday, 18 April is the Liberal Democrat leader Charles Kennedy.

With a new baby less than a week old and a manifesto launch he would rather forget, Mr Kennedy needs a sure-footed outing to get his campaign back on track.

The Prime Minister Tony Blair follows on Wednesday, 20 April.

In the corresponding fixture ahead of the last general election the prime minister famously told Paxman that voters should not assume that National Insurance contributions would go up if Labour won.

They did, and we expect Paxman will want to know why.

Last, but possibly most of all, will be the interview with the Conservative leader Michael Howard on Friday, 22 April.

Jeremy Paxman’s 1997 encounter with Mr Howard, then a candidate in the Tory leadership contest, was easily voted the viewers’ favourite moment in 25 years of Newsnight earlier this year.

We do not need to explain why. What will happen this time?

The Paxman Interviews will be broadcast on Monday 18, Wednesday 20 and Friday 22 April 2005 at 1930 BST on BBC One.

You can also watch the interviews live and on demand from the BBC News Website.

He told BBC Newsnight’s Jeremy Paxman people had to make their own judgement but he took the decision he had to.

“If you want me to apologise for the war in Iraq, I’m afraid I cannot say that I’m sorry we removed Saddam Hussein,” the Labour leader said.

During a 30-minute grilling he also said he did not know how many failed asylum seekers there were in the UK.

Despite repeated questioning, he declined to give an estimate.

Proper controls

He said the government’s measures on asylum meant the numbers applying were falling, the backlog of cases was lower and more failed asylum seekers were being removed.

“For the very reason that the previous government gave, you cannot determine specifically how many people are here illegally,” he said.

“The only long term way of dealing with this issue, however, is to introduce proper controls at borders through an electronic visa regime and identity cards.”

I had to take the decision as prime minister that I thought was right for the country and I did so Tony Blair Blair defends his record Newsnight interview

He rejected the Tory proposal to set an upper limit on economic migrants as having the potential to cause ” damage” to the economy by denying businesses the workers they needed.

Pressed over the government’s use of intelligence in the build-up to the war, Mr Blair insisted the government had been vindicated by four separate inquiries.

He said going to war in Iraq had been a “hard decision” taken for the right reasons.

“You can go through these issues about my integrity, my character, the legal advice… or you can accept that in the end a decision had to be taken.

‘Great partnership’

“There was no middle way, there was no fence to sit on. I took that decision.

“Now I know people strongly disagreed with it. I’m sorry. In the end I had to take the decision as prime minister that I thought was right for the country and I did so.”

Asked if he would replace Britain’s ageing nuclear deterrent, Mr Blair said he believed it was needed by the country, but said it was a decision for the future.

Tony Blair denied having made a deal with Gordon Brown

on whether Labour would raise taxes, he said the party’s spending proposals “are catered for by the tax plans that we’ve got”.

Mr Blair defended the 1% rise in National Insurance during the previous Parliament as necessary for investment in the NHS.

He did not agree with the local income tax proposed by the Lib Dems but did feel council tax should be reformed, he said.

Mr Blair denied having made a deal with Chancellor Gordon Brown to stand down after the election but stressed that they had a “great partnership”.

He restated his intention to serve a full third term if re-elected, saying the job of prime minister was still full of .

“I still think we’ve got things to do. The irony of this job is you are less popular as time goes on but in some ways better equipped to do the job,” he said.

“There’s masses for me to do and that’s what gets you up in the morning.”

*Tony Blair will appear on The Paxman Interviews on Wednesday at 1930 BST on BBC One. You can also watch the interviews live by clicking on the election news in video button at the top of all BBC News website election stories.