1. Hammond backs Pensions Dashboard – and state pensions WILL be included
“The Budget documents provide some succour for those concerned about the Government’s commitment to the Pensions Dashboard.
“While the 2019 implementation deadline still feels like a stretch, the fact a commitment has finally been made by the DWP to provide state pension information is a positive step in the right direction.
“For the project to have any chance of success savers need to be confident the information available is both accurate and comprehensive. Anything less than this and people simply will not trust the information it shows them.
“For this reason it is highly likely the Government will need to legislate to require older schemes to make their information available for the Dashboard.”
2. Automatic enrolment charge cap set for review as Treasury looks to boost ‘patient capital’ funding
“The Government has hinted the 0.75% automatic enrolment charge cap could be increased next year - it will consult ‘to ensure it does not unduly restrict the use of performance fees within default pension schemes’.
“While details are thin on the ground at this stage, it may be that the Chancellor feels the existing charge cap potentially blocks schemes off from investing in the riskier next generation companies he expects to drive growth in the future.
“Any shifting of the charge cap will need to ensure it doesn’t reduce value-for-money for automatic enrolment scheme members.
“Ultimately the aim of auto-enrolment default funds schemes is to maximise returns for retirement investors over the long-term rather than back particular sectors or businesses. If the charge cap were increased for certain types of investments, the trustees of that scheme would have to be confident the extra price paid by members was still money well spent.”
3. Government confirms cold-calling ban will catch lead generators
“Progress in banning pensions cold-calling has frankly been glacial and there is little doubt many more people have been targeted by scammers as policymakers have prevaricated.
“Nevertheless it is positive the ban now appears close to becoming a reality, with the Government aiming for as wide a scope as possible by confirming so-called ‘lead generation’ firms will also be in scope.
“However, the ban will only be effective if the Information Commissioner’s Office (ICO) bares its teeth and comes down hard on the crooks who will inevitably seek to flout the rules.
“It is also critical that the Government doesn’t see this as the end point. While a ban on cold-calling will help in the fight against pension fraud, scammers’ tactics are evolving and policymakers must continue to monitor the market and ensure savers’ hard-earned retirement funds are protected.”
4. Chancellor silent on pension tax relief despite feverish rumours
“Stronger-than-expected public finances have effectively bailed the Chancellor out of making controversial cuts to pension tax relief. It should perhaps be little surprise given the Conservatives’ precarious majority in the House of Commons that Phillip Hammond has shirked any major changes to retirement saving incentives.
“While this stability of sorts will be welcomed by savers, there was something grimly predictable about the build up to this Budget.
“Once again the Treasury floated the idea it was planning to take the axe to pension tax relief, setting off the inevitable rumour mill around how far it could go and in the process creating the kind of uncertainty that damages people’s confidence in pensions.
“Ironically, this also costs the Treasury money as savers fearful of a cut to pension tax relief understandably shovel money in ahead of the Budget statement.
“This is no way to develop long-term savings policy. For many people sacrificing spending today to fund their retirement is a serious commitment and it needs to be matched by a Government commitment not to constantly move the goalposts.
“Establishing such a commitment across political party lines would help build stability and long-term thinking into the UK retirement system.”