Pension Confusion

During a recent interview the Pensions Minister has confirmed her commitment to simplify the pensions arena.

Ros Altman, Pensions Minister, has expressed her belief that past governments have preferred to listen to their Civil Servants than to outsiders with real pension knowledge.RosAltmann-whois

what do Civil Servants know of the world of pensions, when they have gold plated pensions?
Ros, on the other hand, is a champion of consumers and really knows her stuff. In part of a recent interview with New Model Adviser she restated her position:

What progress has Altmann made on her previously stated pension priorities now that she has moved from campaigner for change to the decision maker?

What has been most challenging about joining government?

During the course of the past five years, the UK has witnessed some of the most progressive and radical reforms to the pension system since the end of the Second World War. The key challenge for me is to ensure these policies are rolled out properly for the benefit of the people of this country.

Large organisations are better placed to deal with auto-enrolment, with their human resources departments and payroll facilities, than smaller employers. So I am working to simplify the language and processes, and to see if we can improve our communications to help the smallest employers deal with the complexities of the system.

Are you still pursuing your pre-election call to make pension providers publish their costs in pounds and pence?

We want to build on the requirements that came into effect in April on trustee boards and independent governance committees to report on charges and transaction costs wherever possible.

Following the Department for Work and Pensions’ and Financial Conduct Authority’s (FCA) joint call for evidence on transaction cost disclosure, I am working with the FCA to decide which transaction costs should be captured and how information on charges should be presented.

These costs and administration charges should be disclosed to [scheme] members, employers and others, including how to present them in a meaningful way.

How can you make people understand the new state pension regime better?

The current system is mind-bogglingly complex, which is why we are replacing it with the new state pension. This will bring much-needed clarity to a system that few people truly understand and will reduce the need for means-testing of future pensioners.

There are some common misconceptions I need to clear up. In particular, people need to understand that in the early years not everybody will receive the same amount. This is the intention for the long term for those who have a full national insurance record, but the new state pension will still recognise past national insurance contributions and, in particular, the impact of past contracting-out.

We are putting the finishing touches to a new media campaign, which will reach millions of people in the run-up to the new state pension launch date of 6 April, helping them to understand what we are doing.


Talk to Jan about your pension?