The Financial Conduct Authority (FCA) will publish a paper on intergenerational fairness in 2019, after it has identified this topic as one of its priorities.
Pritheeva Rasaratnam, head of pensions, insurance and retail distribution at the regulator, said at the Westminster Business Forum conference yesterday (December 11) that the watchdog’s plan was to "explore and seek views on the nature of some of these intergenerational challenges, and any barriers to the market innovating in meeting some of these consumer demands".
The FCA plans to use the responses to the paper to develop a plan of action, she said.
Ms Rasaratnam explained that different generations are facing diverse challenges, such as younger people, who will need to work for longer and retire later.
She said: "They might need to live a more modest lifestyle during their working life and retirement.
"It's not all easy for the baby boomers either, some of them are experiencing increasing challenges paying for long term care for example.
"The generations in the middle? Some of them need to plan for their own retirement, and at the same time support younger and older relatives."
Ms Rasaratnam said as a regulator, understanding some of these intergenerational differences and the impact they will have on consumers’ needs in different stages of their lives was one of its priorities. "So we are planning to publish a paper on intergenerational differences next [year]," she said.
According to research from Royal London, more than a quarter of taxpaying pensioners are still in paid work – 1.5 million have employment income and 0.5 million have income from self-employment.
Research published in May by the Resolution Foundation Intergenerational Commission called for pensioners who are still working to continue to make national insurance contributions, in order to fund a £2.3bn NHS deficit.
Ms Rasaratnam also provided further details about the strategic review of the entire consumer pension journey, through both accumulation and decumulation, which the FCA is planning on conducting alongside The Pensions Regulator (TPR).
This is one of the priority areas for joint action as part of a new regulatory strategy for the two organisations.
She said: "We are conscious of the need for engagement and support at precise points of these pension journeys.
"Whether if that is when they are getting started at savings, considering moving their pension, or moving into retirement.
"Under the value for money initiative, this is one of the flagship new joint initiatives coming out of the strategy and will cover both contract and trust based pensions."
maria.espadinha@ft.com
