Wednesday, 20 June 2018

Brexit Mania Hits Pensions

The future of the well supported Pensions Dashboard is in doubt. And Brexit is the reason. The Government seem unable to consider anything other than Europe and our relationship within (or without) it. It means good local policy is being side-lined.

There’s a consensus that legislation is needed to introduce a compulsory Dashboard- a go-to place for all our pensions, held in one place and with all providers required to work with it . Everything in one place and set out in a standard way: What’s not to like?

Limited availability in the parliamentary calendar means the compulsion may not happen- or not any time soon.

With the legislation beginning to slip into the long grass, the Department for Work and Pensions (DWP) feasibility report including the broad proposals, has also been delayed. Due in March, then ‘late spring’, it’s still not here. The DWP are now saying it will appear 'in due course.' Yea, right. And of course, the DWP have no real incentive without a Government willingness to push forward.

One of the best and most far reaching ideas in terms of clear pension’s communication is in danger of not happening, only partially happening, or completely happening but at a date so far in the future we may as well go argue about Brexit.

Monday, 29 January 2018

..And We Wonder Why We Have A Pensions Problem....

Number of Prime Ministers in last 20 years:  4

Number of Pension Ministers in last 20 years:  15

Average tenure of Prime Minister:  5 years

Average tenure of Pension Minister: 1 year, 4 months*

*This includes the impressive 5 year stint from Steve Webb.

Thursday, 26 October 2017

It’s Not Just About Costs

The announcement today from the Government with regard to cost transparency is welcome. It should not be hard for members to understand what they are paying – and what costs are being charged for both administration and investments.

There is one concern though- a rush to the lowest charges may not mean the best deal. There needs to be care involved in explaining costs. A higher administration charge in some cases may mean a local company DC plan can continue, rather than being swallowed up by one of the big providers, or by a master trust. And there’s a good reason for that additional cost if the result is a plan that is better suited to that company’s workforce, as well as it being better presented and explained.

As to investment costs being more transparent- about time too! But again, take care in explaining that lowest charges don’t always equate with best returns.

As employers and providers, we can’t just rely on costs being understood. Members need to understand the value of their pension plan, the fact that it’s tax efficient and that employer money is being paid in as well. These are basic things, but so often still misunderstood by a workforce that is apathetic to pensions. The employer and provider can’t afford the same apathy.

As always, pensions will remain complicated. And it's not just about costs. Good communication is key. Enthusiasm from the provider and employer sponsor is key too.

Monday, 11 September 2017

Pensions Awareness Day - On The Road

It’s year four. And it’s been quite a journey. From originally registering Pensions Awareness Day, to seeking support from the pensions industry (thank you!) to painting up a bus and taking it around the country…. It’s got bigger and better each year.

This year starts in Edinburgh, and the bus then moves on to Leeds, Birmingham, Cardiff and London. Over the week, we are expecting hundreds of people to come onto the bus, asking their questions about pensions. We will be giving away plenty of ‘freebies’ and with help from Pensions Wise, handing out loads of advice.

If you’re in the area, why not come over? This is the website with dates and times in each city:


As an industry, we’ve a long way to go before people are saving anywhere near enough for retirement. But we’re off and running. Join us!

Wednesday, 16 August 2017

Deferreds - The Poor Relations

I’m of that age. Time to start looking at what pensions I’ve got and to consider when to take them. It’s a bit of a shock to have reached such an age, I have to say! I’ve spent most of my career planning other people’s retirement and never really thought about planning my own. But there you go – time waits for no man and all that.

My first foray into my very own pension-land wasn’t such a success though. I approached a life and investment company that had taken over the liabilities of a plan I had been part of a long time back. And was rather surprised to be told I had no pension with them! I was able to produce a deferred pension statement, and all was sorted. But it does beg the question as to what would happen if I were less prepared. How many others fail to sort out deferred pensions due to poor record keeping? Or, more likely, having gone away and failed to notify the provider of the new address.

The usual tracing processes mean that eventually, the deferred member will (hopefully) be found and the benefits sorted out. But there’s no doubt that deferreds – especially in closed DB schemes – are the poor relations in terms of communication.

I hope that the new plans for a pensions dashboard will help rectify this. And there’s legislation on the way requiring an annual statement for deferreds as well. The more frequent use of emails in record keeping is helpful too, as many people may move house but not change their email address.

Nevertheless, as I found out personally, deferreds need a bit more attention.

As to the amount I’ll be getting, well let's say I won’t be fully retiring just yet!


Tuesday, 20 June 2017

Regulator in Danger of Decreasing Pension Membership

At an SPS conference last week, the Regulator's spokesperson talked of the need to encourage consolidation of pension schemes and how to remove the barriers to consolidation.

At the end of her talk, I challenged her. Is she saying 'big is good'?

She assured me she wasn't saying 'big is good' but then went on to repeat what she had said in the talk- the need for lower fees and economies of scale.

There's a problem with this for the small and medium sized employers that value the pension plans they have. They have put the plans in place for a reason, they value them and they promote them to their staff, with a high take-up. they own the plan- it bears their name. It was designed by them.

The moment they are forced to consolidate into something bigger, they lose the 'family touch'. They lose the ownership.

We have seen over the years what happens when the MD or FD is excluded from the scheme they own as a company. Almost inevitably, they start to devalue the scheme and lose ownership of it.

The same will happen with the Regulator's plan for consolidation. Quality plans will be closed - squandered at the altar of spurious reductions in admin and investment fees.

Ownership is lost. Membership decreases.

An own goal for the Regulator.

Wednesday, 17 May 2017

Dear Next Government.....

I’m not sure that pensions will be one of the major battle grounds in this election, and if it is, it may tend to be around the ‘triple lock’ headlines.

That would be missing the point. We need clarity form the next government in terms of the communication of pension plans. I appreciate the initiatives towards one design for future benefit statements, but the sooner the better.

Clarity on the future management and promotion of auto-enrolment is key. As is confirmation of state pension benefits and ages.

All this should lead to a harmonised approach to communicating pension benefits. Too many benefit statements have reams of small print. Most of it is legislative. Some of it is pension lawyers having too strong a say in the look and feel of communications.

It doesn’t help that we have the dreaded statutory money purchase illustrations. Loads of caveats. Tons of small print. So unhelpful.

Dear next government…. Please simplify communications. Cut the small print. Clarify the main figures. Help people understand.