Flexible approach crucial to success of Simple Annual Statements | Pensions and Lifetime Savings Association

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Flexible approach crucial to success of Simple Annual Statements

23 December 2019

The Pensions and Lifetime Savings Association (PLSA) has responded to the Department for Work and Pensions consultation on simpler annual benefit statements.

Pension schemes are enthusiastic about providing simpler and more consistent information to people about their retirement savings and the PLSA has been promoting the Simpler Annual Statement template as an example of good practice, including launching the template at the Annual Conference 2018.

Many PLSA members like the template as an engagement tool, and have said they would like to adopt it on a voluntary basis.

However, PLSA member schemes would like to retain the ability to adapt the statement to their own membership; to align with other scheme engagement strategies based on research with their members; incorporate wider pension benefits and total reward packages; and include more interactive online tools.

It is also quite likely that the Pensions Dashboard will one day overtake the annual benefits statement as the primary source of retirement saving information for savers.

The PLSA is concerned that legally compelling pension schemes to provide a highly prescriptive annual statement will limit members’ ability to achieve the engagement intended.

Rather than mandate details such as the colour of the envelope and the reporting period, pension schemes want to be free to tailor their messages for their own member base as well as innovate the means of communication as technology advances, especially as many types of business are moving away from paper communications.

Lizzy Holliday, Head of DC, Master Trusts and Lifetime Savings at the PLSA, commented: “The simpler annual statement guidelines should balance the need for flexibility with a level of guidance that ensures savers get consistent information from scheme to scheme. We remain unconvinced that a compulsory template for annual benefits statements is the way to do this.

“Going forward the dashboard promises to be the place for members to find collated information, presented in a consistent way.  We believe this should be the focus of greater prescription and consistency of presentation, rather than paper based communications. That way schemes communications can be more tailored to their savers’ needs, with the dashboard providing an overview in one place.

“The PLSA has a strong track record in developing standards for industry adoption, including the Retirement Living Standards, the Cost Transparency Initiative and the Pension Quality Mark. We are keen to continue our current role of promoting the use of the Simpler Annual Benefit Statements as best practice and look forward to working with the industry and Government to support simple, engaging communications with savers.”

Read the full PLSA response here.

ENDS

Mark Smith, Senior PR Manager
 020 7601 1726 |  [email protected]k

Steven Kennedy, PR Manager
 020 7601 1737 | 07713 073024 | [email protected]