Employers can help staff with their money – if only we’d let them

what would you payI had the pleasure of meeting with Jane Drysdale last week. She is HRD of OCS – the office cleaning people who employ 35,000 people , many on zero-hours contracts, many on minimum wages and many on the cusp of eligibility for auto-enrolment.

I don’t mean “pleasure” in a meaningless way, it really was good to hear a senior manager of one of our largest employers so committed to the welfare of staff who are often treated as little more than business assets (or liabilities).

What interested me most was the self-reliance OCS have adopted as a mantra. I have had it confirmed by the advisers OCS used that she did not outsource the problems of auto-enrolment to third party advisers but used the resource of the insurer (L&G) and the adviser (Capital) to deliver the shooting match on time and compliantly for a consultancy coast of £25,000.

Admittedly OCS had to spend money on adapting payroll, but this still works out at less than £1 per head, How many companies can make that boast?

Yesterday I was speaking at the Financial Service Forum about workplace distribution. The question under discussion was “Will the next ten years see a rise in product distribution through the workplace?”.

The conclusion , as far as consensus could be reached, was that employees would only buy stuff through an employer if they couldn’t buy it cheaper on Amazon and that the main thing that employers can save their staff is “time”.

I’d add to that , that employers can protect their staff being ripped off by the wrong kind of financial products, overly expensive pensions, poorly priced protection and  the kind of malpractice at retirement we’ve read so much about recently.

 

Linking my conversation with Jane Drysdale and at this event, it is becoming clear to me that the role of today’s adviser is moving to facilitation rather than the traditional model of employer reliance.

Employers who can do it themselves and touch base with advisers on a “needs must” basis are those that will prosper in the new age of compulsory workplace pensions.

This is not to say there will not be employers who will spend large amounts on advice, but those employers will do so because they choose to rather than have to.

Without the crutch of commission, many advisers have withdrawn from the workplace and those that remain there, now concentrate on providing benefit infrastructure (wrap and flex). The core investment product- the pension , is now a “non-advised” item both in the sense the DWP want it to be (commission free) and because most advisers have fled the coop.

The departure of traditional advisers is most important for the relationship between employers and the non-regulated business advisers , who traditionally have been excluded from assisting on pensions and other benefits through the presence of advisers.

We would like to see accountants, book-keepers and payroll bureaux stepping into the breach. They have strong professional bodies such as the CIPP, CIPD, ACCA and ICAEW, they have recourse to ready information through their own trade press and they have access to pension information through TPAS and the self-help sites  run bythe Pension Regulator – oh and http://www.pensionplaypen.com !

While the battleground today appears to be the ownership of auto-enrolment infrastructure, the issues of pensions and personal debt lurk as the elephants in the corporate board) room.

Whether that’s in some swanky Mayfair HQ or some local lock-up, the issue is the same.

It’s time companies got their mojo back and got real with staff. Technology can help but in the final analysis, it’s the company’s key staff, its staff welfare champions, who will sort out those elephants.

 

 

 

 

 

 

 

 

About henry tapper

Founder of the Pension PlayPen,, partner of Stella, father of Olly . I am the Pension Plowman
This entry was posted in auto-enrolment, Henry Tapper blog, pensions, Retail Distribution Review, Retirement and tagged , , , , , , , , , , , , . Bookmark the permalink.

Leave a Reply