Proposals for the National Pensions Saving Scheme, or Personal Accounts scheme as it has been dubbed, have received popularity and support since their emergence in the 2007 Pensions Bill.

They are to be introduced in 2012 along with several other pension reforms, and mean that employers will be required to auto-enrol all employees into an existing pension scheme or a Personal Accounts scheme. The minimum employer contribution will be 3% of an employee's wage.

Employers can still enrol employees into an existing pensions scheme but will need to apply for an exemption from Person Accounts from the Department of Work & Pensions. Many have welcomed the move, saying that it will increase the number of people who save for retirement in the UK.

Employees are supposed to contribute a minimum of 4% of their pay, while employers have to match it with a minimum of 3%, with about 1% in the form of tax relief. There is a maximum annual contribution of 5, 000 pounds.

The Government has stated that the Personal Accounts must not displace existing good quality pension schemes but instead appeal to those who might not otherwise save for retirement, or do not have a good employer pension scheme.

Which? Is fully supportive of the Personal Accounts scheme, because it is cheap and offers a choice of funds. What still hasn't been decided is how much savers will be able to start their person accounts with, expectations are in the region of 10, 000 pounds. After that, the annual contribution may be capped at 5, 000 pounds which will be updated every year in line with inflation.

Despite these new changes, ISA or Stakeholder Pensions are still recommended as a good place to start for those without good employer pension schemes. However, it is feared that small businesses with no staff pension will not have the resources to find a pension provider once auto-enrolment is introduced.

The UK has more than 80, 000 businesses employing under five people, and over 200, 000 that employ between six and nine, there is concern that these businesses may not have the necessary skills to make informed decisions about a suitable pension plan.

The Association of Consulting Actuaries (ACA), has argued that the introduction of personal accounts, due in 2012, could provide an excuse for employers with more expensive retirement plans to switch to the cheaper government-backed scheme.

ACA's survery of 394 companies employing less than 250 people found almost a third would reduce their pension scheme benefits when the personal accounts are launched, or close their existing pension scheme and switch to the new one.