What you see when you hit the link below. The face is that of Nest’s CEO- Ian Cornelius.

Use this link to get to Ian Cornelius of Nest and Patrick Heath-Lay, the CEOs of our two biggest workplace pensions with between them some £85bn of our money explain how value for our money is created through size.  The link to this paper is here their session starts at 14.53, Patrick Heath Lay is very good at 15.04 explaining how VFM for members in retirement can come from scale.

Patrick Heath-Lay of People’s.

The discussions see Nest and People’s keeping things simple on what people want from their pension – income generally.

They discuss use of Private Markets and the use of private markets to get into the new markets , increase diversity and improve returns.

Cornelius remarks Nest is quite far down the line in investing in assets productive. People’s do not claim to be as far down the road as Nest but are putting in a sustainable investment proportion to last well into the future.

Cornelius suggests that greater emphasis is put on Targeted Support for Nest member’s. Heath-lay apologises for being “quite boring” by agreeing with Nest.  Replacing the emphasis on advice and moving to something easier and cheaper is essential to make the measures in the Pension Schemes Bill.

A problem that needs fixing is consolidation of small workplace providers and consolidation of small pots. By 2030 they are comfortable that solutions can be in place for default consolidators, Nest and People’s clearly hope to work with the Pension Dashboard to make it easier for members with small pots and the market with small providers.

What is comforting from People’s is their CEO with talk of measuring VFM in terms of performance. I do not agree with £4£’s (People’s solution) as providing the solution , nor Australia as the template for our VFM modelling, but I welcome the movement towards an emphasis on outcomes and not just on what it cost them getting there.

Engagement is a further brought up by Parliament’s General Committee. It is not often we can hear Nest and People’s speaking side by side and realistically rather than in the marketing roles of the past. Engagement is not something that can be achieved for millions and People’s and Nest know it, they are planning ways to help ordinary people who don’t want to and can’t engage with what goes on. They welcome the Pension Schemes Bill recognising that value rests with what people get.

The final section of their discussion is turned over to the question of adequacy. The Pension Commission have been given the job of deciding on what people should be paying via Auto-Enrolment. Heath-Lay are again again in agreement on this.

But there is a slightly concerned moment at the end of their session when the issue of what’s the Bill missing is raised. This is a chance for Heath-Lay to raise his bug-bear about tech-sexy but more expensive pension savings arrangements (duck Pension Bee). It’s not going away and pensions would not be itself without some controversy!

A very good session, a very important one in putting a line in the sand for two workplace pensions who are well beyond the scale marks for 2030 and 2035 and an opportunity for workplace savings schemes to make it clear they are going to be workplace pensions.

Heath-Lay

Cornelius