More frequent prompts should be included throughout the auto-enrolment (AE) process to avoid disengaging savers, according to The Money Saving Expert executive chair, Martin Lewis.

Speaking at the PLSA Annual Conference 2020, Lewis explained that the push economics behind AE, whilst effective, had essentially disengaged individuals, meaning they do not feel like an active participant in the pension process.

He continued: “Someone who set up a pension for themselves is always going to be more engaged than someone who has done it by default. So there needs to be more pushes along the way, about how we keep AE going and how we push to engage people to it”.

Lewis suggested that more interventions with different age groups could begin to engage savers with their pension, warning however that there must also be an awareness to the risk of pension scams.

He stated: “The small pot issue is a difficult one, the regulatory burden of getting to move a pension from one place to another and the hideous scams that are going on to try and transfer a pension when they shouldn’t – all mean there are really strong conflicting issues going here.

“We need an improvement in the portals and authorities so that people understand what is legitimate and what isn’t, but I don’t think we’ve dipped in it enough.

"My hope is over the next 10-15 years of AE, there will be nodal points where we get people to consider what’s happening with their money.”

Lewis stated that these would be “really simple tools, often online” authored by "trusted organisations", which enable people to easily amalgamate their small pots.

He also noted whilst the communication for this might not be there yet, the hope is that the Money and Pensions Service (Maps) will be able to do work around this.

Furthermore, in response to a query from the session chair, Smart pension head of proposition development, Michael Watkins, around the potential for a ‘small pots campaign’, Lewis acknowledged that whilst this could be good, it would not be easy.

He stated: "It is very difficult to get people engaged with their pensions...We have this absolute national disease of 'official letter writing', where we write letters that would be so much better if they were a prescription for sleep.

"They write in official complicated language that people don’t understand, and it's done to protect the writer.

“If we’re going to do that type of thing, there are ways to do it, but it’s about totally changing this buttock-clenching self-protectionist way of writing and communicating with people that means that you talk in an official language that doesn’t engage them."

However, Lewis clarified that whilst there is room for simplification in communications, this should not necessarily be applied to pensions regulation, emphasising that protecting savers requires a "careful balance".

He stated: "I would certainly welcome a simplification of language, but I’m not sure about simplifying regulations.

"We have to recognise that there are very substantial times in peoples lives when they're not in the position or capable of making the right decisions for themselves and we need protections in place for those people at those moments so they don’t get ripped off."

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