Everybody moans about losing out at budget- time.

I am sure that if the ABI and PLSA had written the budget , the implementation of the 2017 AE reforms, (the ones that hike up personal contributions for those on low incomes). would have been a headline item. But they weren’t.

On what we didn’t hear in #Budget2024, David Robbins, Director in WTW’s Retirement business, said HMT was still managing to keep the Govt’s stated ‘ambition’ to expand automatic enrolment by the ‘mid-2020s’ out of the fiscal forecasts – even though the mid-2020s had arrived.

— Josephine Cumbo (@JosephineCumbo) March 6, 2024

These reforms are sat there on the shelf, like that nasty tasting toothpaste your dentist sold you years ago. You promise yourself you’ll switch to it but every time you reach for it, there’s something nicer to put on your toothbrush and now it’s becoming a reproach. For all the nagging from the pensions industry, the Government just doesn’t want to apply the good toothpaste. I don’t know what the fiscal equivalent of toothache is, but there’s plenty warning this inaction will result in some serious cavities in our retirement framework later in the century.

I can understand the Government’s reluctance to nudge auto-enrolment rates up. They are already being accused of “giving with one hand and taking away a lot more with the other”. If you subscribe to the view that workplace pensions will wean us off dependency on state pensions , then you could argue that semi-mandatory pension contributions are the new NI ; a pleasing barbel for the economists, NI comes down , AE goes up – it’s possible to play fantasy chancellor and no doubt that’s exactly what the PLSA and ABI are doing now. The problem is, the door is shut, as David Robbins points out, the mid twenties are hear and we’re still waiting here. I fear we’ll be waiting in vain a few years longer.

The lifetime pot smokescreen

Lifetime pot is a smokescreen to stop the conversation about non-delivery elsewhere.

The string of pension failures that have followed auto enrolment is becoming longer

• Dashboard delivery-  failed

• CDC framework – failing

• Small pots initiative – failing

• DB code (1.0) – failed

• Annuity replacement (DA)  – failed

• Superfunds – failing

The lifetime pot initiative, is something to keep our minds off the string of failures and “pipeline” initiatives that are consulted on but yet to be delivered.

What this Government has achieved is a first class workplace pension saving system which has proper governance and has yet to produce its first proper scandal, auto-enrolment has been a success as much for what has not gone wrong as what has gone right and that is no mean achievement.

But all the other interventions into pensions have been duds and the lifetime pot initiative is being resisted as if it were a threat to achieving all the other things that haven’t quite happened (including the latest demands on trustees to report on allocation to UK growth assets). Trustees have been the “go to” implementers of unread reports and can now create document libraries for members on everything from SIPs to VFM, from TCFD to implementation statements. Ask trustees to do something and they’ll get their consultants to do it. No one pays – (except the sponsor).

Here is the rub. Paul Maynard last week told the PLSA that AE would be introduced when the time was “viable”. Viability means “sell-ability” to a Government that knows damn well that it is walking the thinnest of lines on tax-cuts. The recent implementation of a hike in the minimum wage + an increase in employee contributions into workplace pensions would open up further charges of giving with one hand and taking away even more with the other.

And as soon as David Robbins spots AE in the budgetary forecasts, then the pension hike is crystallised and the FT and all the trade press that follows, will have booked the cashflows into the ABI and PLSA’s cashflow forecasts for the commercial master trusts and GPPs that demand feeding.

It is one thing dumping on trustees and IGCs – they may moan – but they mostly get paid and so do their advisers. It is quite another thing dumping on the 1m + small employers who don’t get paid for running pensions but who see auto-enrolment as another wage cost to be funded and administered out of a budget that could else be paid getting on with the day-job (aka improving productivity).

The voices of these 1m + small businesses are represented by the FSB and understood by trade bodies like the ICAEW , ACCA and CIPP. Go to Accountex to find the people who look after their interests, read Accounting Web and Personnel Today and I guarantee you , you will not be reading calls for implementation of hikes in auto-enrolment rates in the middle years of this decade.

The interests of the small businesses of Britain should not be under-estimated , especially by those who work for the big businesses of Britain.

Much as the pension industry will moan about not getting three good meals a day, it is in good shape and if it wants to grow, it had better focus on VFM than rely on AE contribution hikes.