PIMFA urges Government to act on low savings levels
11th January 2018
Successive governments have been quick to remind us of the success of automatic enrolment in encouraging millions of individuals to save for a pension. Responding to the PLSA’s Hitting the Target consultation today, PIMFA – the UK’s leading Trade Association in the Wealth Management and Independent Financial Advice sector – warns government that ultimately automatic enrolment remains a policy based on participation, rather than adequacy of pension savings.
If the government is serious about ensuring the next generation of retirees have a good quality retirement to look forward to, action needs to be taken to not just encourage, but ensure that this will be the case. As a result, we are today calling for Government to increase minimum automatic enrolment contribution levels to 12% as well as provide a level of guarantee that the current pension tax incentive framework remains in place for the medium term at least.
Commenting on the response, PIMFA Senior Policy Adviser, Simon Harrington says:
‘Automatic enrolment remains the most successful policy intervention for long term savings in generations. However, we need to step back and assess what the policy actually does – this is a policy where success is measured by participation rather than adequacy of saving.’
‘As we reach the end of the staging profile next month, it is absolutely imperative that we shift the focus from getting to people to save more rather than save at all. It is not enough to hope that people will save more through voluntary means, all the evidence we have about consumer behaviour suggests that if the default doesn’t change, nothing will change.’
PIMFA is committed to promoting a culture of long term saving and investment within the UK and see access to financial advice as a core component in both supporting people on their savings journey as well as helping them make informed choices at the point of retirement. PIMFA continues to actively participate in discussions around policy with its members and is supported by a number of policy making committees including the Employee Benefits Committee which advised on pension policy.
Notes for Editors
About PIMFA – the Personal Investment Management & Financial Advice Association
- PIMFA is the UK’s leading trade association for firms that provide investment management and financial advice to everyone from individuals and families to charities, pension funds, trusts and companies.
- We represent both full and associate member firms.
Full members provide a range of financial solutions including financial advice, portfolio management, as well as investment and execution services. They assist everyone from individuals and families, to charities and pension funds, all the way to trusts and companies.
Associate members provide professional services to the PIMFA community.
- PIMFA leads the debate on policy and regulatory recommendations to ensure that the UK remains a global centre of excellence in the wealth management, investment advice and financial planning arena. Our mission is to create an optimal operating environment so that its member firms can focus on delivering the best service to clients, providing responsible stewardship for their long-term savings and investments.
- PIMFA was created in June 2017 as the outcome of the merger between the Association of Professional Financial Advisers (APFA) and Wealth Management Association (WMA) – read more.
For further information on this release or other press matters please contact: