Time to unshackle the pensions industry
When people think pensions, they probably don’t think tech and they probably don’t think innovation. I want to change that.
This week is London Tech Week, when the brightest and best from across the planet come together in our great city to showcase the technologies of tomorrow.
Some of the most exciting tech innovators and the biggest names in technology are currently in the capital, introducing innovations which will transform our daily lives and discussing the future of work, the impact of artificial intelligence on society, and the most exciting ideas from every corner of the planet.
In comparison to this, the pensions industry is playing catch-up. I can book a holiday miles away in seconds, manage all my finances through my banking app, and keep tabs on any sporting event anywhere in the world on my smartphone. But I still can’t see all my pensions in one place online.
This is particularly crucial when you consider the huge advances that have been made to pensions saving in the last few years.
Automatic enrolment has brought 10m people into workplace pension saving. This means that it’s more important than ever before that savers can easily keep track of their investments. British people today will have an average of 11 jobs in their lifetimes, with multiple pension pots from different employers.
As people move jobs more often, there is a risk that their various pensions will become confusing, with some pension pots being forgotten entirely.
The priority now is building trust in the pension industry, with more transparency and greater control for consumers.
Online pensions dashboards are the innovation that will unlock that potential. Dashboards will bring pensions power to the people, showing all their pensions savings at the touch of a smartphone screen, and giving them the control that they need to plan for the retirement they want.
The government is working to make pensions dashboards a reality, and we expect to see the first models being tested later this year.
We will introduce legal compulsion to make sure that all the data that savers need is available and, for our part, will ensure that all state pension data can be accessed in the same place. But the government cannot unshackle the pensions industry alone – we need providers themselves to take the lead and provide the innovation that their consumers want and need.
We know that people want more power over their savings – after all a pension is one of the biggest financial assets a person will have over the course of their lives.
During London Tech Week, we will see just how far the world has come and the future that awaits us all. The pensions industry must keep up. If it does not become more transparent – and fast – pensions will be left behind in this brave new digital world.
The pensions industry stands at a crossroads; the age of fax machines, filing cabinets, and mountains of paperwork is well and truly over.
I am determined to put pensions at the heart of our hugely exciting digital future, and that’s why I’ll be driving forward the innovations to push the industry into the twenty-first century.