UK roundup: FCA, auto-enrolment, The Pensions Regulator, NEST, RSA
The Financial Conduct Authority (FCA) has said it will work to create a ‘pensions dashboard’ that will allow savers to track all their pensions savings in one place.
The UK’s financial services regulator made the decision as it concluded its study on the retirement income market.
The quasi-government body will now work with HM Treasury to create the pensions dashboard in the longer term, it said.
Other recommendations included forcing annuity providers to demonstrate how competitive their quote is compared with peers, allowing consumers to identify whether a better deal is available elsewhere.
It will now consult on any amendments required to the regulatory framework and conduct any cost-benefit analysis on its proposals.
In other news, The Pensions Regulator (TPR) has said that, despite awareness for auto-enrolment being high among SMEs, many of those staging later this year are yet to prepare for enrolling staff into a pension scheme.
Some 20% of those expected to stage between June and November lack any firm plans to undergo auto-enrolment, TPR said.
The regulator welcomed the near complete awareness of auto-enrolment legislation (97%) among smaller medium-sized employers.
However, only 86% of small employers were aware and 65% of micro.
This comes as the National Employment Savings Trust (NEST), the government-backed master trust for auto-enrolment, announced it has reached 2m members
NEST has been active for just over two and a half years when auto-enrolment started in October 2012, and is safely the UK’s largest defined contribution platform.
The scheme has a public service obligation to accept all eligible employers wishing to use the platform for auto-enrolment.
NEST now accounts for some 40% of new members saving for a pension via the policy.
Finally, RSA, a think tank, has suggested the UK government implement a policy where self-employed workers are prompted to join a workplace pension scheme, in order to increase savings coverage.
Only 26% of self-employed workers contribute to a pension compared with 49% of employees, RSA said.
The think tank said a policy akin to auto-enrolment for self-employed workers would not be feasible because of issues around volatile earnings, administrative burdens and a preference to save more flexibly.
However, RSA said if the government supported a reminder about joining a workplace pension when filing tax-returns, the level of savings coverage could be increased.
NEST currently accepts self-employed workers in its scheme but so far has only enrolled 700, according to RSA.