Pensions minister defends simpler statements

Pensions minister defends simpler statements

The pensions minister has defended proposals for simpler annual statements after several industry figures criticised the plans.

Last month the Department for Work and Pensions published a consultation looking at how it could deliver annual statements for workplace pensions which were shorter, simpler and included cost information in pounds and pence.

The consultation concluded at the end of last week and several elements of the proposal were criticised by the industry.

Scottish Widows said the benefits of disclosing transaction charges were not clear while the Pension & Lifetime Savings Association said mandating a standard statement would hamper innovation.

But pensions minister Guy Opperman said: "Simpler statements are the way ahead.

"I’m glad and encouraged to see the pension industry has taken this consultation seriously.

"For too long savers have had to try to make sense of wordy, jargon-filled, confusing pension statements. This confuses people.

"People either don’t read them, can’t understand them or lose interest in what is one of the most important investments anybody will make."

He added: "With millions more saving for the first time in workplace pensions thanks to automatic enrolment, it’s more important than ever that they get easily understood information to help them plan for retirement."

The simpler statements would tell savers how much money is in their pension pots, how much they could have when they retire and what they could do to boost their retirement income, in shorter form.

The DWP did not rule out new legislation if providers did not act soon to adopt simpler designs and content.

More than 60 organisations - including trade bodies and pension providers - responded to the consultation.