Autumn Statement commentary from Jamie Jenkins

Jamie Jenkins, Director of Policy, Royal London:

"Pensions are now firmly linked with the economy, and there is clearly affinity between long term investments and long-term funding needed to encourage growth. We welcome the consultative approach to the major structural changes proposed. It’s crucial that we now work through the detailed implications to understand which of these changes will actually serve the objective of supporting economic growth, while improving outcomes for savers."

Pot for life

"Allowing members to choose their own pension scheme sounds like a great idea but, in practice, workplace pensions already offer more investment choice than most people need. And they are highly regulated with capped charges, whereas this change could lead to a pensions system dominated by prolific marketing, higher charges, and ultimately some higher risk pension schemes. 

"Automatic enrolment into workplace pensions has been a huge success story and the relationship between employers and their employees is pivotal to this. A ‘pot for life’ model would significantly undermine this dynamic by requiring employers to navigate an increasingly complex array of payments to different providers. Ultimately, it may disenfranchise the very group of people we’ve relied upon to deliver the successful rollout of automatic enrolment.

"If we really want to engage future generations in their retirement savings and address the proliferation of small pension pots, we should focus on a digital solution by delivering a fully functional pensions dashboard.

"The idea of member choice comes from the Australian pensions system, but if we can learn anything from Australia, it’s the amount they save. The minimum employer contribution is approaching 12%, compared with 3% in the UK. Embarking on a huge project to change the operating model for pensions won’t compensate for this disparity and may simply serve as a distraction, perhaps a decade of distraction. At some point we will need to start facing up to the challenge that we need to save more."

Triple lock

"The triple lock has proved a lifeline for pensioners struggling to keep their heads above water amid the greatest cost of living shock in modern times. In committing to an 8.5% hike, the Chancellor has honoured the Government’s pledge and offered reassurance to millions that they will be able to stay ahead of the inflation curve for the short-term at least. We now need a sensible plan for what it is trying to achieve, and what will replace it once we agree that the State Pension has reached a reasonable level."

Scheme consolidation

"There is clearly merit in having fewer, larger schemes in terms of creating greater scale and reducing regulatory burden, but care must be taken to ensure this is centred in the interests of members, either to secure or improve benefits in retirement."