Industry doubts prospect of success of Mansion House reforms
Less than a third of pension industry professionals believe the Mansion House reforms will be effective, according to the Pensions Management Institute (PMI).
Just 31% of respondents to a PMI poll said they felt the chancellor’s reforms would have the desired effects, while a similar proportion felt the reforms would retain enough cross-party support during an election year.
Nearly two thirds (61%) cast doubt on whether the Mansion House reforms would increase the amount of investment in UK productive assets, and less than half (43%) believe the associated concepts and proposals will become embedded in UK pension policy.
However, this contrasts with research by GLIL Infrastructure that showed schemes were eager to invest in UK infrastructure in line with government policy plans.
The research also found that the industry was growing increasingly dissatisfied with government policy. Two thirds (66%) felt pension policy had been dissatisfactory over the past six months, up from 61% of respondents to a similar poll conducted last year.
In addition, more than three quarters of respondents (76%) said they were pessimistic about the future direction of policy, with more than half (53%) casting doubt over whether the Pensions Regulator would focus on the “right areas” in the coming months.
Respondents were particularly concerned about the lack of communication from the Labour Party about its plans for pension policy. Gill Furniss, shadow pensions minister, reportedly stepped down from her role this week with a successor yet to be named.
PMI president Robert Wakefield said: “Understandably, the substantial regulatory reforms have left many feeling frustrated at the lack of clear direction in pensions policy. The influx of policies makes it look like the government is throwing up ideas, hoping some may be a success without having a long-term plan with industry support.
“There are also concerns that too many pension reforms are happening at the same time without the required resources being available in the industry.
“Our research shows that the industry is increasingly sceptical that many of these changes will now be effectively implemented due to a potential lack of cross-party support. Many also want more clarity from the Labour Party, which may be in government in the next six months, on any changes it plans to make to pensions policy.”
Further reading
Schemes eager to back government’s infrastructure investment drive (30 April 2024)
Treasury to force reporting of UK investment allocations (4 March 2024)
What does Labour have in store for the pensions industry? (7 February 2024)