Change and the new pensions regime
Dave Campbell, Head of Commercial and Innovation at Standard Life, discusses the new pensions regime ahead of the ICAS Tax Conference on 21 May.
There was a time when little happened in the world of pensions. Nowadays, the rate of change would give technology a run for its money.
Most notably, successive governments have embarked on two major experiments: automatic enrolment and 'freedom and choice'.
Automatic enrolment is a test of 'nudge theory' - the idea that people are nudged into saving by being joined into their workplace pension by their employer.
It started in 2012 and completes in 2018, with so far around 5m of the 10m employees in scope already enrolled. And with less than 10% opting out, you could argue that it's half way through and pretty much 'in the bag.'
What this fails to acknowledge is that the employers that have yet to stage number over 1m (compared with c50k so far), and they're smaller firms, without the resources, perhaps even without any real interest.
Politicians are mistaken if they think automatic enrolment is done. There's still much to do.
And we have around 5m self-employed people, and growing, who are completely out of scope for automatic enrolment.
'Freedom and choice' is a very different experiment. Rather than embrace people's apathy, it gives them much greater choice than before.
From 55, people can take their pension pot and do pretty much what they like, from blowing it all on a Lamborghini to securing a guaranteed income for life.
Of course, with choice comes complexity, and with complexity comes the need for support.
Standard Life has been at the forefront of both of these changes, most recently, speaking to customers about their pension choices. Despite the peak of customer contact around 6 April, that's not the real story from these reforms.
The real story is quite different. I'll be speaking about this and other key pensions issues at the ICAS Tax Conference on 21 May in Edinburgh.