Webb confirms DA will need new legislation

Speaking at a Trades Union Congress seminar on his plans for defined ambition pension schemes, Webb said there were details the government could change "quite quickly" by altering current laws to encourage certain benefit structures. But he added there was also "big stuff" that would require acts of parliament.

He said: "So we are looking at things we can do quickly, but we’re also looking at whether we need to pass parliamentary primary legislation. I think we probably do, but when exactly, and how – that is still to be determined."

His comments – which were challenged by delegates – follow recent remarks made by Labour MP and Work and Pensions Committee member Sheila Gilmore, who said in an interview with Pensions Week that defined ambition would need its own legal framework due to its complexity.

Video: Sheila Gilmore discusses the government's defined ambition policy.

Doug Taylor, chief advocate of financial services at Which?, also sitting on the seminar panel, said a number of different styles could be confusing. 

He added: "If these are complex, does that increase disengagement [among employees and employers]?"

In defence of his plans, Webb said he envisaged a range of models for employers to choose from, as all companies are structured differently.  

"If we, for example, come up with two or three models that work for employers, and something that is better than the minimum, then I think we are doing the best for people," added Webb.

His example of supermarket Morrisons' cash-balance scheme as a defined benefit 'lite' arrangement met with criticism from a delegate from the trade union Unite, who said although it may look attractive on the surface, it might not deliver the best outcomes for employees.

"It is difficult to be enthusiastic about the concept when you’re not certain it is going to produce the quality of benefits," added the delegate.

The government was also accused of focusing too much on large employers when considering how defined ambition would work.

"The majority of people in this country are actually employed by small and medium enterprises," said another delegate, also from Unite. "How does the dynamic that you are suggesting work with those sorts of companies?"

The Department for Work and Pensions is expected to publish its final proposals on defined ambition later this year.