Steve Bee and B&CE’s John Jory argue against means testing pensions
Friday, 30 November 2007
In the latest podcast from Scottish Life's 'Pensions Radio', Steve Bee, Head of Pensions Strategy, talks to John Jory, Deputy Chief Executive of B&CE, a not-for-profit supplier of financial services and employee benefits to the UK's construction industry. The podcast covers a variety of topics including auto-enrolment under the Distance Marketing Directive, means testing, the Government's role in pensions education and the possibility of rebranding pensions.
On the subject of pensions disregard - making some or all of the individual's pension savings invisible to means testing - Steve Bee commented:
"When looking at means testing pensions, it just seems so obvious that if people believe that saving for retirement doesn't pay, they will stop doing it. Disregarding some pensions savings is a partial solution. I'd argue for total disregard, where all pensions savings are ignored when calculating means tested benefits, but partial disregard would at least be a first step."
John Jory added:
"We have to restore confidence in pensions, particularly with low to moderate earners who have a number of other demands on their finances. Means testing raises doubts about the benefits of pensions savings and it is likely to discourage saving. I think we should move away from the negative connotations associated with pensions by rebranding them 'retirement pay'. The common factor between holiday pay, sick pay and maternity pay is that you get some help from your employer but they don't pay for everything. For instance they will give you paid leave to go on holiday, but you have to pay for the flights and hotel yourself. It's the same with retirement pay, your employer will help you, but if you want to do the things in retirement that you dream of doing, you've got to save yourself."
To hear the full conversation, or to access the archive of all Steve's Pensions Radio podcasts, go to www.scottishlife.co.uk/BeeHive.
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For further information please contact:
Scottish Life
Steve Bee
Head of Pensions Strategy
Tel: 020 7506 6740
Alasdair Buchanan
Head of Communications
Tel: 0131 456 7133
Polhill Communications
Jenette Perry
Tel: 020 7655 0530
Mobile: 07867 503553
Editor's Notes:
Royal London Group
The BeeHive regularly attracts over 20,000 visitors a month to Steve Bee's regular 'BeeLines' which are dedicated to demystifying pensions.
The site's Pensions Radio podcasts have featured interviews with various key opinion leaders in the industry, including:
- Nigel Waterson, Shadow Minister for Work and Pensions and Conservative front bench spokesman on pensions;
- Danny Alexander MP, Liberal Democrat Shadow Secretary for Work and Pensions;
- Bob Crow, General Secretary of the National Union of Rail, Maritime & Transport Workers;
- Lawrence Churchill, Chairman of the Pension Protection Fund;
- Ros Altmann, pensions campaigner;
- Malcolm Small, the Chairman of the Pensions Network;
- Robin Ellison, NAPF.
Scottish Life was founded in 1881 in Edinburgh as a proprietary company, becoming a mutual company in 1968.
On 1 July 2001, Scottish Life demutualised and transferred its business to The Royal London Mutual Insurance Society Limited. Scottish Life is a division of Royal London and is the specialist pensions business within the Group, providing individual and group pensions to the market via intermediaries.
Scottish Life and Royal London's other intermediary businesses are based in Edinburgh where 1,200 staff are employed, with 195 working in other parts of the UK and overseas.
Royal London Group is a specialist financial service provider. Its businesses focus on those sectors of the market which value premium propositions, operating through a number of brands:
- Scottish Life – UK pensions market
- Bright Grey – UK protection market
- Scottish Life International – offshore investment markets
- RLAM – fund management
- RLAS – life and pensions administration
Royal London is the largest mutual life and pensions company in the UK with Group funds under management of £32.9 billion. Group businesses serve around three million customers and employ 2,580 people.(Figures quoted are as at 30 September 2007).
B&CE Benefit Schemes
B&CE is the largest supplier of financial services and employee benefits to the UK's construction industry. Formed in 1942, B&CE operates on a not-for-profit basis. It offers a range of products tailored specifically for its customers in the construction industry and is dedicated to the welfare of those who work in the building and civil engineering industry and their dependants.
- Almost 7,000 employers use B&CE to provide employee benefits.
- B&CE provide the UK's most popular stakeholder pension - with almost 500,000 members.
- The B&CE board is made up of six trade union members and six employer representatives.