11 December 2012
Standard Life makes recommendations to support good outcomes for DC pension savers



Standard Life has today launched a report making six key recommendations to industry and policy makers to help ensure a positive experience and outcome for those who are automatically enrolled into defined contribution (DC) workplace pension schemes.

'Now we're nudging' follows on from last year's 'Keep on nudging' report and examines how the industry can use the Pension Regulator's six principles framework to ensure that DC workplace pension schemes deliver good outcomes for members. The report recommends:

  1. Appropriate contribution decisions: The pensions industry, its regulators and commentators, should prioritise and remain focused on creating a positive perception of saving and increasing the number of pension savers through auto-enrolment, then look at how to encourage people to save more than the initial statutory 8% rate.
  2. Appropriate investment decisions: Providers, advisers and trustees should help employers review scheme default funds to ensure they are still fit for purpose before they start auto-enrolment, and ensure there is a review process in place thereafter.
  3. Effective and efficient administration: Providers and regulators should use customer insight to conduct a grass roots review of key regulatory communications to ensure they are genuinely useful and easy to understand.
  4. Protection of assets: Providers should highlight where significant risks are borne by members and take action to ensure these risks are minimised.
  5. Value for money: The industry must deliver on its commitment to provide clear and meaningful information to employees on pension charges and investment transaction costs, and the potential returns.
  6. Appropriate decumulation decisions: Providers should review the communications provided to people in the lead up to retirement, to ensure they are being given the support they need to make the right decisions.

Jamie Jenkins, Head of Workplace Strategy, Standard Life said: “Auto-enrolment provides the UK with an unprecedented opportunity to build a savings culture and help people to save and feel more confident about their future. The success of auto-enrolment will not just be measured by the number of people who stay enrolled in their workplace pension scheme, it will ultimately be measured by the results that are delivered for them at retirement.

“Over the past couple of years the industry has worked with the Pensions Regulator to develop a consensus on the six key 'enablers' to delivering good member outcomes. We fully support these enablers, but believe that more needs to be done to ensure that they genuinely work for people in practice.”

'Now we're nudging' sets out how the industry can work in partnership with policy makers, regulators, employers and employees to ensure that scheme members get a better experience across the six core areas.

Jenkins added: “We are already working with our clients and their advisers to review default fund options in advance of staging dates to ensure they are appropriate for auto-enrolees. In addition, we have moved to close access to some external fund links which we do not feel are suitable as default options for auto-enrolees.

“We are committed to looking at a number of other initiatives to support good member outcomes and we believe that our six recommendations, if acted on appropriately, will help ensure that workplace pensions evolve for the benefit of employees.”

A full copy of the 'Now we're nudging' report can be downloaded from www.standardlife.com.

Ends



For further information, please contact:

Steve Hartley
PR Manager
Tel:0131 245 1365
Mob: 0771 248 6387
Email: steven_hartley@standardlife.com

Nicki Lundy
Senior Media Affairs Manager
Tel: 0131 245 2737
Mob: 07515 298 302
Email: nicki_lundy@standardlife.com

Notes to Editors

Established in 1825, Standard Life is a leading long term savings and investment company, with around six million customers worldwide. By understanding and offering innovative products to meet its customers' needs, Standard Life helps people with their financial planning, so they can feel more confident about the future.

Standard Life offers a range of individual and group pensions, SIPPs, ISAs, annuities, life assurance, offshore bonds, investment management, wealth management, tax planning and estate management services.

Standard Life has created a dedicated website for employers, trustees and intermediaries. It includes information and a toolkit to help schemes plan for auto-enrolment and details of a new investment proposition for company pension schemes launched earlier this year workbenefitszone.com

Standard Life is headquartered in Edinburgh and employs around 9,000 people across the UK, Canada, Ireland, Germany, Austria, India, USA, Dubai, Singapore, Hong Kong and mainland China. At the end of September 2012 the Group had total assets under administration of over £211bn.

Standard Life plc is listed on the London Stock Exchange and has approximately 1.5 million individual shareholders in over 50 countries around the world.

Standard Life plc is also listed in the Dow Jones Sustainability Indexes (DJSI World) in recognition of its performance as one of the world's leading sustainability-driven listed companies.

You can follow Standard Life press office (@sl_press) on www.twitter.com/sl_press



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