On the go: Laura Trott has been urged by the Association of Consulting Actuaries to extend collective defined contribution schemes to more savers as a way of boosting pension savings.
In his letter to Trott — who was announced as pensions minister on November 7 — ACA chair Steven Taylor also emphasised that any changes to pension tax rules “should not be yet another ‘tweak’ that risks further [undermining] pension savings or undermines workforce retention”.
The Telegraph has reported that the government is considering reforms to pensions tax relief. Taylor’s letter, seen by Pensions Expert, was copied to the chancellor of the exchequer Jeremy Hunt.
In the letter, Taylor recognised the current challenges of expanding auto-enrolment provision.
“We continue to believe you should carefully extend AE provision over the next few years but, given it may not be desirable to rapidly raise minimum AE contributions, government should also consider more steps to allow long-term savings to be used more flexibly when and where they are needed,” he wrote.
“We strongly support the early extension of CDC schemes to a wide audience as one means to boost pension savings.”
Taylor also called for a “proportionate” policy response to the recent market turmoil and liability-driven investments.
“Great care is needed in making changes – new regulations, codes and guidance need to reflect this, and we will be separately making representations to your department on these matters over the coming weeks,” Taylor wrote.
Taylor expressed concerns that the complexities of delivering pension dashboards, meanwhile, will undermine the project.
“We are worried that the complexities in delivering dashboards that will provide reliable figures upon which savers can make important decisions are currently being under-estimated,” he wrote.
“We believe now could be a good opportunity for you to pause and reflect on whether there should be further easements to the timetable that might better ensure strong outcomes are delivered immediately from Day 1 following their launch.”
On November 1, the Financial Conduct Authority announced that FCA-regulated providers will now have until August 31 2023 for implementation, to align with the government’s extension to a deadline on occupational pension schemes. This deadline was delayed from June 30 2023.
