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How you’re online statement might look
The DWP Select Committee has published its findings on the Government’s communication of the changes in state pensions. The publication, just over a week before the state pension system radically changes, couldn’t be more timely.
Perhaps the most worrying aspect of the report is that what it tells us about the Government’s communication strategy is “news”. While the Government has been blogging away and issuing public service videos via its pension tube channel, its headline awareness videos largely go unnoticed. Without a promotional budget they are worthy but ineffective.
Awareness campaigns can work- witness the 2m + people who’ve watched the 10 seconds of Workie dancing in the hairdressers. Techies may argue that all that’s being communicated is the most basic features of auto-enrolment, but those numbers tell me Workie’s working.
So why are so few people tuning in and turning on to the DWP’s communication campaign on our new pension rights? Historically, the DWP’s answer to lack of engagement (see WASPI) has been to proclaim all is quiet on the pension front. Unfortunately, (see WASPI), lack of engagement can come back to bite the DWP in the bum.
I’ve no doubt that the WASPI campaign has given the DWP a boot up the backside on pension issues. The DWP Select Committee is in no doubt that there’s a problem afoot, especially for those whose entitlements are being cut by the changes
The losses are largely products of the simplification of an outdated and extraordinarily complex system. It is those complexities, however, that make explaining the consequences to those affected imperative. People who understand their individual circumstances are better placed to adapt their plans in their best interest. Government should not rely on general awareness campaigns or happenchance in promoting that understanding. It should focus on identifying the individuals affected, assessing their potential losses, and communicating with them
There have been a rather more respectable 21,000 views for the Government’s explanation of what the end of contracting out might mean. But this is little more than a high-level overview. Last week the National Audit Office pointed out the shortfall in information available to ordinary people to find out about their Guaranteed Minimum Pensions and other details of their contracted out pensions.
The problems for people retiring at or immediately after April , is that there is a general expectation that “things can only get better, a problem created by the Prime Minister’s £155 per week ceiling on state benefits as a general entitlement. The expectation has been set too high.
So the acute problems worrying Frank Field and his team of MPs are a subset in a chronic problem of engaging and educating the mature British working population in what they can expect as state benefits.
The Department has rightly upped its efforts to explain the more complex elements of the reforms and made clear headway in establishing an online system for state pension statements. The Pensions Minister should take credit for this progress. Though the Government will need to ensure that those without access to the internet, or who are uncomfortable using it, are adequately informed, online provision of personalised pension information will clearly become increasingly important.
The Government aspires to promote greater private pension saving. In order to best plan for retirement, individuals need to see a complete picture of their state, workplace and personal pensions in one place. We therefore welcome the Government’s commitment to ensuring the creation of a pensions dashboard by 2019. This is in line with our previous recommendation. Achieving it will be challenging and we will continue to monitor progress closely.
The challenge is obvious, while the private sector might like to think it already has dashboards (Big Blue, MoneyHub, Lemonade and so on, the truth’s that most data is still out of the reach of the scraping technologies of Yodel and the like. Combining State Pension Forecasts with on-line information from private pensions means more than “having an app for it”! 2019 will be challenging.
For the moment, the Committee calls for immediate and dramatic intervention that pushes out information (rather than expecting us to find stuff for ourselves)
The Government’s pensions strategy is predicated on people engaging more with their pension savings and better planning for retirement. By relying on individuals requesting a state pension statement or generating one on a website, the Government risks missing those it most needs to reach.
We recommend the Government sends automatic state pension statements to all people aged 50 and over. These should be issued annually, in line with the private sector. Individuals should be able to choose to receive their statement by email or opt out on the digital statement system. Such individuals should still be informed by post of any major policy changes that affect them.
The proposal is radical; the Government would communicate with the entire adult population over the age of 50 by email, where no email exists, the information would be provided annually – presumably by post.
But where is this database of emails? How can Government get us to tell them how to talk with us?
Right now as a 54 year old, I cannot even get an online statement of my potential benefits. I have no idea what my years of contracting out and my time as a self-employed person have done to my entitlement to the new state pension.
While I entirely agree with the sentiment and applaud the ambition, I have absolutely no confidence that the DWP Select Committee’s proposals have any hope of becoming reality.