After years of profound legislative change, many people in the pensions industry are calling on new pensions minister Ros Altmann to usher in an era of relative calm. Some of these same people would also like her to push for an independent retirement savings commission.
The industry was taken by surprise on Monday when Altmann, a stalwart of UK pensions and the previous government's older worker's champion, was appointed pensions minister in prime minister David Cameron's cabinet.
Prior to her appointment, financial secretary to the treasury David Gauke MP was the presumptive pensions minister, with many reporting his appointment and endorsing his expertise – ironically, in hindsight.
The industry was taken by surprise on Monday when Altmann, a stalwart of UK pensions and the previous government's older worker's champion, was appointed pensions minister in prime minister David Cameron's cabinet.
Prior to her appointment, financial secretary to the treasury David Gauke MP was the presumptive pensions minister, with many reporting his appointment and endorsing his expertise – ironically, in hindsight.
@davidgauke will be an excellent Pensions Minister. To ensure reforms work well for State and private pensions
— Ros Altmann (@rosaltmann) May 11, 2015David Gauke's office could not be reached for comment.
Another minister with a passion for pensions...
Altmann will have big shoes to fill as minister. Her predecessor, Steve Webb, served for five years and was considered an oddity among recent pensions ministers for both his length in the role and enthusiasm for the brief. After he lost his seat in the election last week, many in the industry praised his contribution.
However, Altmann was widely praised for her expertise as the news of her appointment broke.
@rosaltmann the new UK Pensions Minister has lots of experience with the issues and a real concern for older people: http://t.co/pmDtTYhCEZ
— David John (@dcjretiresecure) May 11, 2015Richard Butcher, managing director of independent trustee company PTL, said of the appointment: "It's good we've got someone with an interest in the subject matter [who] knows something about it."
Butcher said he hoped Altmann would preside over a period of relative calm, allowing the wide-ranging changes of recent years time to bed in. He also raised concerns about Conservative plans to cut pensions tax relief.
"If they take tax relief out of the system it increases the cost of benefit. If you reduce the tax relief, you're just reducing the amount that's in the pot."
"The risk is that they see higher earners or contributors as being a soft touch. If you tax them more you disincentivise higher contributions," he said, adding higher contributors subsidise the cost of low contributors.
Calls for an independent commission...
Many industry figures called on Altmann to examine the introduction of an independent retirement savings commission.
In a statement, Joanne Segars, chief executive of the National Association of Pension Funds, said: "We encourage the minister to consider the benefits a commission would offer. By providing impartial and independent expertise and analysis a commission would allow the minister to make policy that stands the test of time."
Steve Herbert, head of benefits strategy at Jelf Employee Benefits, said a commission would help inculcate a "more considered approach to change" in pensions legislation.
He added it would also ensure pensions became more resilient to changes rooted in political interest.
"I'm a little concerned that [Altmann] is not an elected official, which means her chain of command is back to the party, not back to the people," he said.
