MP for Watford Richard Harrington was made parliamentary under-secretary of state for pensions in July. Here are five areas the industry believes should be his priority over the coming months…
From auto-enrolment to the lifetime allowance, one thing is clear - the industry wants simplicity and no more rabbits pulled out of hats.
A lot has happened in pensions over the past years, not least the radical overhaul of the legislative landscape under former Chancellor George Osborne, sandwiched between various attempts to tinker with the way pensions are taxed.
Harrington (pictured) was appointed pensions under-secretary following the resignation in July of pensions minister Ros Altmann. Altmann said at the time she was "at heart a policy expert, rather than a politician" and had felt short-term political considerations, exacerbated by the EU referendum, had "inhibited good policy-making" over the past year.
In response, pensions industry network mallowstreet has surveyed its 3,000 members about their immediate priorities for the politician.
Here is what they have come up with:
1) Auto-enrolment - keep it simple: Auto-enrolment is the number one priority for the industry, according to mallowstreet. "The industry believes the success of pensions going forward depends on the success of auto-enrolment," CEO Stuart Breyer said. "There was a clear emphasis on the need for simplicity to understand savings, with messaging being engaging and easy to implement."
2) Political collaboration: The industry wants to see the new under-secretary work closely with the business secretary to ensure potential conflicts between defined benefit recovery plans and the need for increased investment are resolved. It also wants the Treasury and the Department for Work and Pensions to get together to "establish a new simplified pensions and savings system that encourages a higher level of savings across the workforce, with auto-enrolment as its base".
3) Women and pensions: A much-debated topic of late, the raising of the state pension age for women born in the 1950s and after created an unfair burden on hundreds of thousands of women, according to Altmann. Another problem was the changes were not communicated properly. Mallowstreet said the industry would like to see a review of the issues surrounding the group of women identified as missing out significantly on the State Pension as a result of the changes.
4) Lifetime allowance and annual allowance: Parts of the industry surveyed felt the lifetime allowance (the total amount people can save over the lifetime of their pot without incurring extra tax charges) should be removed to ensure that auto-enrolment does what it was intended to do - encourage people to save more. Others felt the government should abolish the annual allowance, saying they believed it was reasonable, in principle, to have a limit on tax-favoured pension saving.
5) Regulation - no more rabbits: The overwhelming consensus among mallowstreet members was that the industry spends too much time reacting to rabbits pulled from hats, as well as pre-empting surprises and visualising how they may affect the industry and pension landscape. Yet, quite often, these things do not come to fruition - pension tax relief being one example, Breyer said.
Other things the industry would like to see included: just one regulator for occupational pensions; the triple lock turned off by 2020 given its "unaffordability"; and the regulation of master trusts.
Breyer said: "The message is clear. After successive years of changes to pensions, the industry now wants time to focus on making what is already in place work. From a political standpoint, the hope is the appointment of an ‘under-secretary' implies that there will be less political tinkering and interference in pensions. Time will tell whether that underlying message is the case."
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