Yesterday was a historic moment for UK pensions. After a decade in power the Labour government has at last recognised that the effect of the past 25 years of pensions policy has been to leave the country with a system that is too mean, too means tested and too complex to be comprehensible - while providing too few incentives to save for those on lower to middle incomes.

While the pensions problem for most developed countries has been, and remains, one of affordability, for the UK it has become one of adequacy. In adopting the core recommendations from Lord Turner, chairman of the independent Pensions Commission, the government has found the beginnings of an answer to the adequacy problem without jeopardising affordability.