Unfortunately the wrong people had been put forward by Aviva (Dale Critchley) and L&G (Colin Clarke) to talk about surplus extraction and the fiduciary responsibilities of the trustees to make sure that surplus was well spent.
A long conversation did occur but it was cut short by the Chair. Torsten Bell, the Pension Minister picked up with a question at 11.06
“can you give us an update on how you intend to implement your workplace pensions about what you are going to do to comply with the Pensions Schemes Bill”.
Torsten Bell asks them to confirm what process they are going in to land on the default, clearly impatient that the only factor being put forward by Aviva is “size of pot”.
L&G’s Colin Clarke says that his company are going a little further and encouraging savers to pick their solution rather than rely on a “one size picks all” approach. I suspect that they will have to work hard to get individual choice when a default is in place. I tried that in the early years of the century and the default won!
The Liberal Spokesperson asked both insurers what experience they had had from travels abroad in deciding what “silver bullet ” could be found for Britain. This was jumped at as clearly this is something that insurers like doing a lot, especially when the trip is to Australia. We had a response (hard to see who made it with the poor filming) but it could be either or both screaming for more money into workplace pensions (as Australia get) and a Value For Money methodology that did not result in herding (as it does in Australia).
To allow this view further publicity, here is Colin’s explanation of the value of the experience he has recently had abroad. It has 85 likes and no doubt has a lot of weight within L&G.
Following the contribution from Colin Clarke, another contribution on what can be found in Australia (and especially VFM) came from Dale Critchley of Aviva. Once more the learning was that VFM monitoring can lead to herding as everyone rushes for the same thing so as not to close down.
This session finished off the morning and we ended with a complaint that insurers cannot look towards “targeted support” (for instance on consolidating small pots) , commercial companies will be caught by privacy protections. I am not sure what this is about but it sounds like yet another reason why small pots are like to remain for a time yet.
The view from Dale Critchley is that 2027 was a bit tight for implementation if they were still waiting around secondary legislation. It was also a concern that value for money would need data to be available (I know the problem of getting data from Aviva and L&G guys)!
There will be a need for a lot of resource from insurers from L&G and Aviva to improve technological advantage to members and Dale and Colin could not be sure that it would be available from its rivals.
The general feeling was that there would be plenty to get teeth into from secondary legislation. My impression is that these insurers do not think the Roadmap is realistic in its timescale on page 17
Produced in the afternoon by the Pensions Minister – Torsten Bell.
