How can auto-enrolment help those that most need it?



This morning I’m off to the House of Commons to discuss this question with some policy people, Prospect Magazine, my friends Alex Rowson of QTAC and Darren Philp of People’s Pension  and Nigel Wilson, the CEO of Legal & General. Nigel’s written an article which address the question in the title and you can read it here.

The article’s important for a number of reasons, firstly because it is intrinsically good, but secondly because it demonstrates the ongoing support the “for profit” providers see in supporting auto-enrolment. If I thought that this was philanthropism, I wouldn’t be impressed, we already have NEST taking a bath on AE commercials.

L&G and the other insurers still in the game (Aviva, Standard Life, Aegon,Royal London, Scottish Widows) aren’t offering Qualifying Workplace Pensions out of public service obligations, they see an opportunity to make money for shareholders.

At this morning’s session, we will be discussing a number of questions that touch both on the future of auto-enrolment and how the commercial as well as the not for profit providers will approach auto-enrolment from now on.

Here are the questions – what do you think?

  • How will pensions companies deal with the large number of small pension pots coming on the market from SMEs in 2016 and with people moving jobs in the absence of pot-follows- member or aggregation?
  • What is the likely short-term consequence of the National Living Wage announcement in the Summer 2015 Budget, and in the longer-term, how do we move beyond auto-escalation to deliver meaningful pension income in retirement?
  • Given the cuts in tax credits and cash freeze on working age benefits, can we expect an impact on the number of people that choose to stay ‘opted in’, especially if employers don’t make up the shortfall?
  • Given questions about the sustainability of the state pension’s “triple lock” and about pension tax reliefs, what is the most effective way to incentivise saving through auto-enrolment?

Perhaps the final question is the one that matters most to the nation, as it touches on questions of culture that go much deeper than the fiscal issues in previous points.

In my view, the only way to win the long-term argument is to capture people’s hearts and minds as has happened in Australia. We need a long-term savings culture and that will happen when people return to trusting pensions.

As Nigel Wilson points out

We should have a financial system where our slowly ageing population can use low-cost digital technology to save adequately for a longer retirement, which should include meeting costs of care.

We should make much more productive use of peoples’ retirement savings as they accumulate—investing for growth, productivity and jobs in ways which are directly visible to savers.

We should help people make well-informed choices about how to access their funds in later life, using the whole of their “personal balance sheet,” without paying away excessive sums in advice charges, fees and commissions.

And we should use the pensions infrastructure to “lean in” to a world where governments face mounting affordability issues with state benefits.


Auto-enrolment is the platform on which much of this work can be done. But to make it happen, we need the whole “feelde of folke” working together.

Never has Piers Plowman’s dream been more important- good on Prospect for helping make it happen

More on the outcomes of this discussion tomorrow – and on my subsequent meeting with the good employers of Somerset at the Payman Auto-Enrolment seminar this afternoon!

About henry tapper

Founder of the Pension PlayPen,, partner of Stella, father of Olly . I am the Pension Plowman
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