Public trust in pensions industry rises slightly in 2021

The ‘public trust score’ for the pensions industry increased by 1.5 per cent in 2021, according to Trafalgar House’s Trust and Confidence Index.

The index, which takes the views of over 2,000 people and provides an annual check on the public’s trust levels in the pensions sector, found that the trust score had increased from 4.56 out of 10 in 2020 to 4.63 out of 10 in 2021.

The index found almost a third (31.5 per cent) of people stated they have no or very little trust in the industry – slightly down from 34.5 per cent in 2020.

However, just over a quarter (25.5 per cent) said they trusted the pensions sector either a reasonable amount or a lot, which was down from 26.7 per cent.

Those feeling that this lack of trust in the industry had a negative effect on their savings was a concern for 25.8 percent, down from 29.6 per cent in 2020.

Only around one in seven people (14.9 per cent) felt that the industry positively impacted their saving levels.

Trafalgar House client director, Daniel Taylor, commented: “Our research highlights the significant gap between the industry’s views on member engagement and the reality of what members actually experience.

“Although we have seen some small positive improvements in this year’s figures, the industry is still a long way from delivering on its duty to protect and support members’ long-term saving plans.

“To see so many people again state their lack of trust in the industry and that this is negatively affecting their savings and decisions shows that much more needs to be done to build relationships with members.

“A small degree of comfort can be taken from the needle moving slightly more favourably during what has been a tremendously difficult period for savers.

“The versatility and flexibility shown by much of the industry seems to have been noted – a surprising move when we could have expected the scores to head in the opposite direction given the pressures caused by the pandemic.

“Winning this small battle is, however, overshadowed by the industry’s overall losses in the war to win member trust and confidence.”

Trafalgar House also revealed their research into members’ understanding of their pensions and showed that, when respondents were told a number of several key industry terms, no term had been heard previously by more than half of the respondents.

However, 79.1 per cent of people who had heard of auto-enrolment felt they were confident they could explain its meaning to friends or family, while 76.2 per cent felt they could explain ‘normal retirement date’.

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