Jonathan Stapleton hears from The Pensions Regulator chief executive Lesley Titcomb about why we need a technological shift in pensions
At the beginning of March The Pensions Regulator chief executive Lesley Titcomb will have completed her first year in charge of the watchdog – a year in which auto-enrolment (AE) has progressed well, despite a step-change in the number of firms staging.
But speaking at the Pensions and Lifetime Savings Association annual chairman's dinner on Tuesday (2 February), Titcomb said these increasing numbers were not the only factor of success.
She said: "It would be easy to watch membership figures go up and claim AE a total success. But enrolment is not the same as engagement. How do we make sure that people connect with pension saving for the long haul?"
We can't afford to let pensions remain the bumbling elderly relative who doesn't know how to turn on a computer. Nor can we expect that simply putting existing jargon and small print on a tablet or smartphone will make it any more engaging or useful. It will not.
Titcomb said building confidence in pensions would be a good start to achieving this aim – noting that TPR needed to play a key role with this.
But she also questioned whether the industry as a whole was doing enough to engage generation Y and millennials on pensions and speak to them on their own terms and in their own language.
She explains: "I don't need to tell you that paper statements and member booklets aren't going to pass muster with the many millions of people now being automatically enrolled."
Titcomb pointed towards the ever-increasing ability for people to use mobile devices to interact with financial services – and could now get insurance quotes and check bank statements while on the move.
She said: "You can't deny that people's expectations have been raised in terms of how they engage with financial services.
"We can't afford to let pensions remain the bumbling elderly relative who doesn't know how to turn on a computer. Nor can we expect that simply putting existing jargon and small print on a tablet or smartphone will make it any more engaging or useful. It will not."
Titcomb said there was a clear need for something that brings together information about a citizen's savings for later life – and said TPR was currently considering its position on the subject of a pensions dashboard.
She said: "We've got a very good view over the pensions landscape, and our work on scams has taught us a lot about how to coordinate a cross-sector, consumer-focused, educational drive.
"As such, you won't be surprised to hear that we have started talking to the Financial Conduct Authority (FCA) on the subject of a dashboard or similar digital product and will be taking a close interest in this in 2016."
Titcomb said that whatever form such a dashboard or digital product takes, it will have to recognise all possible savings and assets that can contribute to the fluid process of retirement.
She explained: "A single, digital portal could help address the fact that most people reaching retirement simply don't know what they have saved."
Titcomb said such a strong push toward digital solutions would bring increased challenges – especially in areas like cyber security, which she said would also be a focus for the regulator in the coming year, regardless of what happens with a dashboard.
Titcomb also talked about diversity within pensions. In the past year, Titcomb said TPR had hired a number of senior female staff, and noted that all four recent board appointments had also been women.
But she said, while TPR has a public sector equality duty as an employer, it also has one as a regulator – noting that, while one quarter of FTSE 100 board position were now occupied by women and TPR itself was getting its house in order, few trustee boards could claim likewise.
She said: "It is very clear that boards need to be representative of those they serve. They need to maximise their access to talent from all sources, they need to guard against group think and they need to enable trustees to bring their whole self and experience to their role.
"That's how you get people performing at their optimal level. And that's how you get boards performing at their optimal level. And you won't get that if everyone you see is white, male and straight."
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