Is pension transparency in tension with increased private assets?
Rachel Elwell, chief executive of Border to Coast, raises the prospect that the long-awaited pension dashboard project in the UK might encourage savers to question how much exposure they have to private assets (Pensions UK)
The launch of the pensions dashboard in the UK is one of the long-running sagas of this sector - the idea was first floated in 2016 and the dashboard - a platform to enable savers to see how much they are saving and where their savings are invested - still does not yet exist.
It is edging closer to becoming reality but an interesting question is whether this long-awaited programme is in conflict with one of the UK government’s other much-vaunted reforms.
This was raised by Rachel Elwell, chief executive of the Border to Coast Pensions Partnership, at the Pension UK conference this week.
Namely, she questioned whether allowing savers to have greater insight into where their pension is invested and how it is performing would come into conflict with the UK government’s desire for pensions to invest greater amounts in UK private assets.
She said: “The challenges we are facing collectively as an industry are about getting people exposed to private markets.
“If we see more short-term decision making because individuals have that information available, that’s going to be a factor we have to think through.”
Elwell did agree it was “incredibly important” for savers to have greater access to information but she pointed to the “difference between having data and knowing what to do with it”.
Jamie Fiveash, chief executive of Smart Pension, agreed the pension dashboard would be good for savers.
He said: “I'm quite passionate about this subject because I do think we need a new transfer infrastructure.
“I do think it is on us as providers, especially as the market consolidates down, we need to work out a better transfer system to move money more quickly around the market.
“The current one isn’t working in my view, too expensive and also not always working in the best interests of the customer
It is hard to see how the dashboard won’t increase consolidation. I think it’s going to go up and up and up. It is something we need to think about on the front foot.”
