We are the voice of insurance and long-term savings | Contact us

Sacred cows and golden geese: five reflections from the ABI Long Term Savings Conference

By Henry Thompson, Policy Adviser, Long Term Savings & Retirement 

"Sacred cows"
"
Golden geese"
"
All hat but no cattle"

You'd be forgiven for being surprised to learn that these were just some of the colourful turns of phrase heard at ABI HQ during our Long Term Savings Conference. 

Yet beyond the soundbites and idioms, some interesting themes emerged during the panel discussions, providing plenty of food for thought for all. Here are my five key takeaways from the day for those who weren’t able to make it:

1. Consider the Gauke uncorked.

The conference provided DWP with the chance to unveil their new boss in his first outing as Secretary of State for Work & Pensions - and an opportunity for him to set out his stall in front of the industry. In what would have been music to the ears of many in the room, Mr Gauke noted need for longer term thinking and “a well thought-out approach” to policy making, “built on a solid evidence base”. Recognising his party's diminished political muscle in the Commons, Mr Gauke was keen to emphasise the need for greater collaboration across party lines; an approach that may well lead to progress on some of the big ticket items on the Government’s to-do list. Attention was drawn to his slip regarding advice/guidance, but industry will benefit from Mr Gauke's steady hand on the tiller as he looks to "chart the new pensions landscape”. Oh – and in case you missed it, it looks like reform to tax relief is off the table (for now).

2. We need to join the dots

As ever, there are numerous consultations, reviews and debates afoot regarding a whole host of public policy issues in the savings and retirement space. All of these issues are interconnected in some way, from the automatic enrolment review to debate over the future viability of the triple lock golden goose. Add in issues outside our usual realm, such as student debt, the gig economy and housing, and we begin to appreciate the need for a truly holistic approach to policy making so we can fully understand the impact that one decision can have on others and avoid any unintended consequences. Independent retirement commissioner anyone?

3. There’s no escaping the care crisis

Whilst not an intended topic of discussion, time and time again our speakers pivoted back to the crisis in social care funding and its implications for individuals, industry and Government. In the first plenary, John Cridland referred to our ageing population as a challenge as great as the one posed by climate change; a sentiment that makes the prospect of reform all the more pressing (and daunting) - and means we need an honest debate around various sacred cows. But while we await the green paper on social care, the current parliamentary maths could end the political football that has dogged this issue for so long and set us on a path towards achieving a truly long-term, sustainable settlement that stands the test of time. 

4. Engagement AND defaults

Delegates were treated to a humdinger of a political debate on the virtues of engagement versus defaults in retirement, which were themes throughout the day. Accused of being rose-tinted, Huw Evans noted the need for consumer engagement is not a “Let’s get stoned” utopian ideal but a practical reality. Amid the cheap shots, each side put across some compelling arguments, but by the end, a consensus seemed to emerge in the audience about the need for a combination of both to help customers achieve an adequate income in retirement. But to date, industry talk of engagement is all hat and no cattle, said Abraham Okusanya of Finalytiq. So there is plenty more industry can do to boost consumer engagement, building on existing and ongoing projects, including simplifying pension language, reframing the benefits of pension saving and the creation of pension dashboards. Watch this space…

5. Austerity and what it means for pensions

The political narrative of the day - be it the cost of living crisis in 2015 or the current disquiet over austerity - is closer to home than we think. With pressure mounting on the Government to lift the public sector pay cap, attendees heard through one audience member’s question how many of the teachers and doctors that his specialist firm typically serves are opting out of excellent schemes simply because they don’t have the disposable income to save into a pension. This chimes with the recent ONS report about savings levels falling to 1.7% amid the ongoing stagnation of wages. The response from Cicero Executive Chairman, Iain Anderson? Get lobbying. We must bear these big picture issues in mind during our engagement with Government and understand how they relate to our policy priorities, particularly within the context of the automatic enrolment review. 


Last updated 11/07/2017