Guest comment: Switching focus

With the election behind us we can now turn our focus to concrete policy issues. Late last year, the DWP consulted on simpler annual benefit statements (ABS).

In our response, the ABI argued for a design-based principles approach as this ensures the best experience for the customer.

There is a need for customers to be able to understand and compare their retirement savings, with the key information upfront in a statement, including costs and charges, but a rigid two-page statement risks not meeting these needs.

There is a lot of good work already going on here, including digitally, which this could negate.

The current trend is to tailor communications, and a one-size-fits-all approach does not support the needs of certain customer groups, such as vulnerable customers and older cohorts.

There is little to no evidence that a rigid two-page statement would be a more effective for communicating with customers, and it does not account for customers with special characteristics or where they are in their retirement journey.

Instead of introducing a prescriptive ABS, resources should focus on the development and implementation of pensions dashboards.

Dashboards will deliver the benefits of ABS in a more convenient and efficient way.

Research conducted on behalf of the ABI shows that investors engage more with their finances on a dashboard, further bolstering the argument that this is where our attention should lie.

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