As a director of policy, what do you view to be the most successful policy introduced in the last 10 years and why?

It almost seems too obvious to say, but it has to be automatic enrolment. Harnessing behavioural insights to encourage savings has reversed the UK’s downwards trajectory of pensions participation, and 10 million new savers is a proud record. It shows what can be achieved with cross-party consensus. However, to really transform the retirement prospects of citizens across the UK, we need to do much more - raising contribution levels for a start.

With the shift from DB to DC pensions in the UK retirement landscape, auto-enrolment has been largely successful in driving up workplace pension saving, but this is still not enough. What can be done to encourage increased saving and higher contributions?

Last year’s auto-enrolment review made a good start to drive up workplace savings, by lowering the age limit to 18, and taking pension contributions from the first £1 of salary. However, the current timetable of the mid-2020s is a missed opportunity - these changes should come in as soon as possible. There is also no reason why the age limit should not be lowered to 16 to catch people as soon as they start work, with all the benefits that early contributions entail.

Beyond this, we know that 8 per cent won’t be enough for many, and we want to explore with DWP what mechanisms can be used to raise the headline rate. We should not forget that Australia’s superannuation rate will soon be 12.5 per cent.

Following on from the ABI’s tech sprint on creating savings prompts for the self-employed earlier this year, [how] do you think is the best way to get greater numbers of self-employed people saving into a pension? Could a system similar to auto-enrolment work?

In the absence of an employer, it is difficult to apply the mechanisms used in auto-enrolment. It is also important not to fall into the trap of treating self-employed people as one homogenous group. They are a diverse community with a wide variety of ages, income levels and financial capability, which calls for a variety of solutions. The tech sprint did come up with some fantastic ideas for engaging different segments of the self-employed community, often linking to “gig economy” platforms to make it extremely straightforward to save. We look forward to working with DWP as they embark on feasibility testing for some of these ideas.

With collective defined contribution schemes also gaining greater attention, do you see this type of scheme taking effect? What impact would it have on the current pensions landscape?

Collective defined contribution schemes have admirable aims. However, many important questions remain to be resolved, from the regulatory regime to the tax treatment. The variable nature of the benefits would also be difficult to communicate to consumers and the need to cut incomes in the event of a severe market correction could become extremely political.

At a time where many consumers struggle to put their trust in pensions, it seems unwise to be introducing additional complexity.

As a former lead of the pensions dashboard project, what is the ABI’s view regarding the continuation of its development. What is needed to make the platform a success?

My view of this remains the same as when we published our ‘Reconnecting People with Their Pensions’ report in October 2017. For the dashboard to be a success it needs to be comprehensive, which in turn requires legislation to compel schemes to share their data in a standard format. We are awaiting DWP’s feasibility study and I very much hope they will conclude that this project is not only feasible but that it will deliver enormous benefits to people up and down the country, allowing them to find the estimated £3bn of pension money that lies unclaimed and making proper retirement planning possible. We stand ready to support DWP in every way we can to make it a reality.

What is next on the agenda on the pensions front at the ABI?

So many things! Before the summer, we are expecting the government’s green paper on social care, the FCA’s Retirement Outcomes Review, the pensions dashboard feasibility study, FCA’s work on non-workplace pensions, and over the summer further engagement with DWP on their plans to improve the defined benefit sector.

More widely, the ABI is committed to helping tackle the lack of diversity across our sector, and I am also very interested personally in exploring how we can eradicate the savings and investment gap between men and women.

Looking ahead, what do you see happening or hope to happen in the pensions market in terms of policy and product developments?

I would like to see a culture change around savings: people feeling a much greater sense of personal ownership of their pensions, and routinely taking guidance (and advice) on their financial plans. The new single financial guidance body can play a huge role here, in concert with the industry.

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