IFoA responds to Government's Work and Pensions Select Committee report on pensions reform

• Policy makers need to take a long term view
• Raising age at which pension savings can be accessed could alleviate some of the risk of individuals running out of money in retirement
• Pension Wise guidance needs to be fit for purpose to help people plan appropriately

The Work and Pensions Select Committee has today (10 March) released the paper ‘Progress with automatic enrolment and pensions reforms’ calling for the establishment of a single pension regulator and an independent commission in the new Parliament.  The Institute and Faculty of Actuaries (IFoA) is encouraged to see the Committee address a number of areas in the report that have been raised about the pension freedoms, such as the need to protect consumers.  It is important that a new Government takes a long term view and considers the full impact of the pension reforms for both existing and future retirees.  

Gareth Connolly, Chair of the IFoA Pensions Board, comments, 

“It is good to see the Committee looking into more detail of how the new pension freedoms will affect consumers.  The IFoA would welcome a review of consumer and industry behaviour during the first six months after the pension freedoms come into effect to see if current legislation is adequate or needs revision.

A review of the age at which pension savings can be accessed, which is currently 55 and rising to 57 by 2028, would be welcomed as it could go some way to alleviating some of the risk that individuals may run out of money in retirement.

The IFoA has previously stated concerns regarding the promised guidance individuals are due to receive in the run up to retirement and it is important that this guidance is fit for purpose and helps individuals plan appropriately for their retirement needs.

The IFoA welcomes the steps Government has taken in the run up to April, when the pension freedoms come into effect, and that the Committee has recognised that further small steps in developing the retirement framework will be required after implementation.  This will be of great assistance in ensuring that the next generation of retirees will have a pension framework that enables them to have good retirement outcomes.

~ENDS~

For further comment or to answer any questions that you may have please contact Annette Heninger at the IFoA on 07525 592 198 or by emailing annette.heninger@actuaries.org.uk

Editorial notes

About the Institute and Faculty of Actuaries

The Institute and Faculty of Actuaries (IFoA) is a royal chartered, not-for-profit, professional body. 

Research undertaken by the IFoA is not commercial.  As a learned society, research helps us to fulfil two of our royal charter requirements; to further actuarial science and serve the public interest.  

Actuaries provide commercial, financial and prudential advice on the management of a business’s assets and liabilities, especially where long term management and planning are critical to the success of any business venture. They also advise individuals, and advise on social and public interest issues.

Members of the IFoA have a statutory role in the supervision of pension funds and life insurance companies. They also have a statutory role to provide actuarial opinions for managing agents at Lloyd’s.

Members are governed by the Institute and Faculty of Actuaries. A rigorous examination system is supported by a programme of continuing professional development and a professional code of conduct supports high standards reflecting the significant role of actuaries in society.

The IFoA is available to provide independent expert comment to the media on a range of actuarial- related issues, including enterprise risk management, finance and investment, general insurance, health and care, life assurance, mortality, and pensions.