#PAD19 – We have no right to be right

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No sooner than I’d written my blog on Pension Awareness Day, than it was challenged by Paul Lewis.

Clearly Paul felt strongly enough to come back for seconds..

I agree with Paul – and so I expect do most of his 114,000 followers. Pensions are inaccessible to ordinary savers and are (quite rightly) seen as a tax-perk of the rich.

Auto-enrolment is not working well for 1.75m savers who are missing out on the promised incentive from the Government and the inequalities between well funded DB (and DC) plans and the bare minimum contributions most people – though far from obvious – are no less real for that.


More people pass by than say hello to pensions

It was great to spend a day in the sun in Cathedral Square Peterborough. I talked with a good number  of the 300 or so people who came to the Pension Geek’s stand, but many thousands walked by, smiling bemusedly at us. Hardly anyone who came on the stand was under 40 and most of our inquiries were from people at retirement – those who I describe as being in the straits of Hormuz.

For those who walked by, I suspect there was that nagging feeling of guilt we get when walking past the gym. Why spoil a lovely autumn afternoon talking about something that is either too far away or too scary to bring any happiness?

Some people knew when they were due to get their state pension, many didn’t. Worryingly one person who had been born in late April 1955 didn’t know he had another year to wait for his state pension.

We met one woman who was angry, “If I wanted to get shafted, I’d have become a prostitute – as least I’d have got paid”. She was WASPI

We met many who did not have the information to take decisions and some who had the information but couldn’t make head or tail of it (ever tried explaining the COD on the back of the state pension forecast?).

But it wasn’t these people who Paul was thinking about, but those who avoided us, as you avoid beggars.


Guy Opperman came and wrote!

It was good that the pensions minister came to the bus and spent some time talking to the Geeks. I introduced him to someone I’d been explaining the pensions dashboard to. The fellow listened to the promise of a dashboard some time soon. I don’t think he was too impressed. I could see two banking apps on his phone , he drove fork-lift trucks.

The sadness for Guy Opperman is that he is overtaken by big politics. Whether his pensions bill makes it through the storms of the next six weeks is anybody’s guess – including his. We discussed the lack of information that everyone who visited us had, not one person was able to discuss their pensions using digital information. The Pensions Dashboard looks as far away as ever – I wished the minister luck as he contemplates his party conference.

There is cynicism in that tweet but let’s get this straight. Guy Opperman gave up his Sunday to be there and he then wrote this in the Times

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People knock pension ministers , but I’m not knocking this. Credit Jonathan and Rachel for creating and managing the momentum, but let’s be in no doubt that the people of Peterborough want a lot more than auto-enrolled workplace pensions, they want security in retirement and for many of the people I spoke to yesterday, that is simply not there.


We have no right to be right

I don’t agree with the sentiment behind Tim Morris’ tweet

Pension Awareness Day is not a start, it’s a part the pension industry’s attempt to seize the popular imagination. The popular imagination isn’t seized, that is not the same as “burying its head in the sand”, the people who walked on by had been let down.

I am not happy for the pensions industry to congratulate itself on being right. If it thinks that a couple of busses whizzing around the country for a week makes it alright, it is wrong.

We are not right. People don’t get their promised incentives, they aren’t getting a pensions dashboard (anytime soon), there is no proper wage for life retirement option for those in DC and nobody can explain what they’ve got.

The only people I spoke to all day who were comfortable about their pensions were the pensioners and a woman who was retiring to Wales with the proceeds of the sale of her business which she told me was staying in the bank.

Let’s not kid ourselves, for Paul Lewis , the thousands who didn’t come on our stand are more important than those who did. These are people we simply aren’t reaching.

We cannot do what Tim has done and blame people for burying their heads in the sand, we need to give them reason for looking at their pensions and pension pots and making sense of them.

We are wrong and they are right and till we adopt some humility about our abject failure to reach around 94% of the population, the financial services industry had better get that into its thick head.

agewage advice

About henry tapper

Founder of the Pension PlayPen, Director of First Actuarial, partner of Stella, father of Olly . I am the Pension Plowman
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3 Responses to #PAD19 – We have no right to be right

  1. John Mather says:

    I hope the exercise gave the geeks an insight into what people feel about pensions
    At 60 with a spouse 10 years younger an indexed annuity costs just £2M to produce 109% of national average wage. The state pension, if fully qualifying, gives around 25% of NAW

    In my experience the mayoralty of individuals pay meaningful sums into pensions over a 15year period. Paying £40,000 into the plan over this period gets to around £1M Few can afford or qualify to pay £40,000pa

    The reason that most of the tax benefits go to the top 10% of earners (those above £50,000) is that those earning less cannot afford to contribute as the productivity of the country is not high enough to generate wage increases. We run two economies one for the 60% of low income earners and the other for the higher earners

    QE has made the have/ have not divide worse. The rule makers still benefit from the DB benefit arrangement where the risk is with the tax payer. This tax benefit is not taken into account by those who look just at the NI and IT annual cost to The Treasury

    Until all have the risk shifted to the individual the tax benefit will continue to be for the rich at the expense of the wages of the poor.

  2. henry tapper says:

    I’ll think about this risk transfer point. Certainly i didn’t see much capacity to take risk amongst most of the people who I saw in Peterborough, but take it they must. many of the people coming on the stand were not rich but were pension rich – many had DB pensions – but sadly we did not see the have nots – one of the problems with these events is that those who are outside the tent – have difficulty finding a way in.

    • John Mather says:

      The “tent” was not designed for the poor they have to be content with platitudes and nonfeasance

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