All week I’ve heard criticism of Steve Webb for telling employers they do not need advice to auto-enroll. The other side to that coin is that the DWP believe that employers can do it themselves.
It was another week when an employer outed themselves as a £1m + spender on staging auto-enrolment. Leslie Williams went public on the webpages of Professional Pensions blaming the failure of her payroll provider (Ceridian) to provide her with the support she needed. Where the money went isn’t clear but the word Mercer appears several times in the article. Whitbread join an unhappy list of employers including our own Lloyds Banking Group who accept they are overrunning the DWP estimate for large scheme staging (£4,700) by a seven figure sum.
The conversations I am having with the SME payrolls are not as encouraging as I had hoped to be having my now. The initial enthusiasm that they would be ready with solutions for the first big hump or stagings early next year has been replaced with talk of restricted budgets and complaints of planning blight caused by the ongoing consultation on AE simplification.
So far all the signs are that employers regard AE as a compliance obligation rather than an opportunity to help their staff provide for themselves in their later years.
Disappointingly , the advisers who I am speaking to have decided to be led by this rather dismal vision.
Instead of insisting on positive innovation in terms of better governance, better decumulation options and better accumulation options the majority are simply focussing on selling the penalties of “wilful non compliance” and the advantages of signing up to a hand holding service provided by…well you’ve guessed the rest.
In the meantime the gossip is about whether Aegon will replace Standard Life on the Mercer best buy list, why Gerry Ghandi left NOW and who will survive the phony war over the summer and the carnage following the OFT report.
This is not a positive message to be giving to the DWP ,much more importantly the country. The DWP’s excellent PR Campaign focussing on the “I’m In” message is the only positive message I’m getting on auto-enrolment.
Judging by early analytics on www.pensionplaypen.com ,there is a lot of interest in the site as a “one stop shop” for 2014 + stagers. But will our site be able to deliver a simple journey for an employer that will enable them to project plan a way to staging and beyond, select a pension that will meet the DWP’s minimum standards and more importantly add value to their businesses.
It’s a leap of faith.
Will we win general support from Providers so that the site is seen as a way of easing the AE traffic jam?
Will key influencers. journalists, commentators and those who create the rules for auto-enrolment, regard the site as a “Force for Good“?
Most importantly of all, can we get employers who are currently disinterested in workplace pensions to get stuck in and do it themselves?
The answer to this question, as to all the questions that hang over the outcomes of pension reform is whether the 2014+ stagers will find a way to self-serve.
I have only three strategies I can offer the pension industry
- Smarten up our act- reduce waste, focus on delivering more for less and work hard
- Innovate– we have moved from a sales environment to a controlled purchase environment. I
- Promote- we no longer need to sell “saving” we need to sell our capacity to turn this saving into good retirement outcomes.
In smartening up our act, we can start winning back the confidence of key influencers such as Martin Lewis (who openly mock pensions) and start restoring people’s faith in pension planning.
By innovating or at least supporting innovation we can create means for the 1.2m employers still to stage, to do it for themselves
And by promoting ourselves to the public as an industry committed to smartening up and innovating, we may win through.
I say “may” as I have no idea whether we can bring down the cost of enrolment from £1,000,000 to £100 as the DWP wants us to.
Whatever we do , whether through www.pensionplaypen.com or through the endeavours of other organisations will be worth nothing if employers do not respond.
We cannot do it for you guys, in the final counting, you will have had to have done it for yourself or the cost of auto-enrolment, as Lesley Williams pointed out, will be higher than the contributions to the pension accounts!
- All you never wanted to know about that Pension PlayPen GPP (henrytapper.com)
- Who speaks for workplace pensions? (henrytapper.com)
- The Regulator’s brilliant auto-enrolment website. (henrytapper.com)
- Ten sexy stats that drive pension firms wild! (henrytapper.com)
- “Fair and True” applies to the DWP too! (henrytapper.com)
- Get up! Stand up! For your pension rights! (henrytapper.com)
- Why bloggers won’t replace journalists (henrytapper.com)
- Waiting for Dunkirk ; The Pensions and Benefits show #pb13. (henrytapper.com)
- What a charge cap would mean for insurers (henrytapper.com)
- Not what’s in the pot but what it buys – Pension RTI (henrytapper.com)