ACA chair welcomes new dialogue about pensions
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The chair of the Association of Consulting Actuaries said there was “a change of mood music” over pensions in recent months as reforms enjoy cross-party support. However, he called for urgent action on social care over state pensions, and for the swift introduction of the defined benefit funding code.
Steven Taylor made the comments during a speech at the ACA’s Industry Dinner held in London on Tuesday, highlighting the many proposed pension reforms under the Mansion House banner and the industry’s involvement in shaping government policy.
“It’s starting to feel that collectively it’s beginning to make a difference. New initiatives such as collective defined contribution schemes, which combine a natural growth investment focus and, we believe, the possibility to significantly improve member outcomes, do seem set to get their chance to succeed,” he said.
Taylor was also positive about potential changes to the Pension Protection Fund which could incentivise sponsors to build up pension surpluses. These, said Taylor, could help to finance pensions for the next generation “more efficiently”.
“It remains to be seen which of these policies emerge over the next year and what will be for general election manifestos. However, for the ACA’s part, we welcome the dialogue these consultations have brought about for reforms that can both boost our economy and outcomes for savers,” he said.
The LCP partner also showed himself pleased that opposition parties appear conscious of “the importance of a thriving private pensions sector in building decent incomes in retirement”, as well as being supportive of collective defined contribution and auto-enrolment reforms.
However, there is a need for urgent changes in social care funding and the state pension, he argued.
“We would add our voice to the many others saying that on the triple lock, parliament needs to find a new consensus that rebalances the support we give to younger generations as against the grey voter,” said Taylor. “A long-lasting settlement on issues such as social care is far more urgent than further gold-plating inflationary increases to the state pension.”
The ACA also finally wants to see the defined benefit funding code come into force.
“Some argue that the code is a relic designed to solve past problems. I would suggest instead that most DB schemes now operate as if the code already exists, and ACA will continue to work with [the Department for Work and Pensions, the Pensions Regulator] and others on what are hopefully the final tweaks to the new regime.”
Before speaking about pensions, Taylor made a tribute to his predecessor, Hymans Robertson partner Patrick Bloomfield, who died suddenly earlier this month.
“I was stunned when I heard the news last week. In his policy work, Patrick wanted to make the industry a better place and to improve outcomes for future generations. As an association, we will strive to continue that legacy with the zest and determination that he demonstrated.”
Bloomfield chaired the association until May 2022.
Condolence messages can be sent to tributes@hymans.co.uk.
