Future of Financial Services APPG – Cross party group calls for National Insurance Day to drive saving for retirement
Press Release – For Immediate Release
Cross party group calls for National Insurance Day to drive saving for retirement
A cross-party group of MPs and Peers has called for the creation of a National Insurance Day to boost public understanding of pensions. National Insurance Day would encourage earlier retirement saving, and the importance of adequately preparing for later life.
The recommendation is one of seven to follow the All-Party Parliamentary Group’s inquiry into Income in Retirement. The inquiry identified low levels of engagement with pensions as a major barrier to achieving financial security in retirement.
The report also calls for pensions education to be included in the National Curriculum, a pensions dashboard for workers receiving their National Insurance number and a Royal Commission on dignity in retirement. The APPG also recommended reforms to strengthen auto-enrolment, clearer pathways to adequate retirement income in defined contribution schemes, and a government-backed drive to increase the take up of Pension Credit.
Commenting on the report, Peter Bedford MP, Co-Chair of the Future of Financial Services APPG said:
“The stark reality is that too many people are not saving enough for retirement. The evidence we heard was a wake-up call. Few people even approaching pensions age adequately engage with their pensions. Alongside my work on the Pensions Schemes Bill, this inquiry reinforced a simple truth: one of the biggest challenges facing our pensions system is a lack of public understanding.
“If people are to achieve the retirement they expect, they need to start saving earlier and save more. However, this will not happen on its own. We need a step change in pensions awareness, with government taking a proactive role throughout people’s working lives. That is why we are calling for practical reforms that help people understand their pensions, plan ahead and build greater financial security in retirement.”
Lord Sharkey, Co-Chair of the Future of Financial Services APPG added:
“Too many people are approaching retirement without a clear picture of the income they are likely to have in later life. The system needs a rethink with deliberate steps demarcated to ensure individuals engage with their pension and likely income in retirement.”
“Our recommendations are designed to create a culture in which retirement planning becomes a normal part of working life. From better financial education to clearer information and stronger support, we need to equip people with the knowledge and tools to make informed decisions about their future. A good retirement should not be left to chance.”
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Contact: For further information or to arrange an interview with the Chair of the APPG on the Future of Financial Services, please contact Havard Hughes on 07989 345 820 or at havard.hughes@barndoorstrategy.com
Notes to editors:
1 The APPG’s full recommendations are as follows:
I. The establishment of a new National Insurance Day; an annual financial education event working with schools, pensions providers, banks, financial institutions and employers highlighting pensions and savings to all those in the UK with a national insurance number. It could be held on or around the 2nd December following the Budget and be tasked with ensuring everyone has access to the information they need around pensions.
II. National Curriculum based financial education should include a discussion of pensions, especially with students in their mid-teenage years approaching employment when they receive their national insurance number.
III. Regulatory action targeting consumers through the establishment of a comprehensive pensions dashboard to be rolled out to new workers as soon as they receive their national insurance number so that they can engage with and track their pensions and likely retirement income throughout their working lives.
IV. A Royal Commission into dignity in retirement to commence a national conversation into how future pensions are paid for and how economic activity can be harnessed to ensure the pensions of the future meet the retirement expectations of the population.
V. Flexibly scale-up auto-enrolment – with protections and opt-outs to ensure it has the potential to deliver an adequate retirement incomewith five-yearly reviews of Auto-Enrolment to ensure the new pensions landscape is working as intended before problems have time to crystalise. Auto Enrolment rates could be raised with the knowledge that employees could opt out and set a rate which suited them or their circumstances.
VI. Require all DC pension schemes to provide a clear pathway to that adequate retirement income, perhaps through the pensions dashboard – in other words, to achieve this you need to put this much away – and make it as clear and simple as that.
VII. Government should launch a scheme to increase Pension Credit take-up – using simple language and effective communications to get core messages about take-up through to ordinary people.
2. Copies of the Report can be downloaded from the Future of Financial Services APPG website: https://tinyurl.com/FoFS-Pensions-Report .
3. The Future of Financial Services APPG is led by Co-Chairs Peter Bedford MP and Lord Sharkey. Peter Bedford is the Conservative MP for Mid Leicestershire. Lord Sharkey, the Lib Dem Peer and former joint managing director of Saatchi & Saatchi UK. Its membership consists of more than 40 cross-party MPs and Peers.
4. You can view the Future of Financial Services entry on Parliamentary website here:https://publications.parliament.uk/pa/cm/cmallparty/260629/future-of-financial-services.htm