Aviva Life and Pensions Ireland (Aviva) has called for the introduction of an annual pension statement for all people with pensions – a pensions’ P60.
- People should have a "P60 for pensions" says Aviva
- Customers, not regulation, must be at the centre of our pensions’ framework
Aviva Life and Pensions Ireland (Aviva) has called for the introduction of an annual pension statement for all people with pensions – a pensions’ P60. In its submission to the Pensions Board as part of the consultation process on pension simplification, Aviva also called for a more consumer focussed pensions’ framework. Aviva believes that the current pensions’ framework, which sets out the Government’s strategy for pension reform, is complex and confusing.
Commenting on Aviva’s submission, Kevin Moss, managing director, Aviva Life and Pensions Ireland said: "Aviva supports the idea of an annual pension statement for all pension customers. Just as all taxpayers get an annual P60 setting out their tax affairs, we believe people with pensions should benefit from the same.
"Our analysis indicates that a considerable proportion of the population who have pensions are not aware of even the most basic information about their pensions. In many cases, people forget who they have their pension with, what their contributions are and how much their pensions are worth. In some instances, particularly with people who have frequently changed jobs, we have found that people have forgotten that they even have a pension.
"An annual pension statement would go towards correcting this. It could set out on an annual basis, just as your P60 form does on taxes, what your state of play is. In effect, we believe a P60 for pensions would not only make people more informed, it would make pensions more relevant in people’s financial thinking."
A recent European Commission White Paper on pensions also proposed an annual pension statement for consideration.
Commenting on the Government’s pensions’ framework approach, Mr Moss said: "Everyone accepts that we need greater public buy-in and participation in pensions. To achieve this, we have to make the objective of simplification a reality. We have to get the balance better between informing people without overloading them in jargon.
"To achieve this, there is an urgent need to make the pension framework more consumer focused and less driven by the interests of non-consumer stakeholders such as pension providers, advisers or regulators. By placing consumers at the heart of pension reform, genuine improvements are achievable."
Recognising that putting in place a simpler pension’s framework will take time, Aviva stated that there needs to be an overarching framework that covers matters such as a universal maximum benefit for all, easier transferability of pension plans and earlier accessibility.
"Aviva strongly supports the Pensions Board’s desire to making pensions more accessible and easier to understand. We are committed to working with consumers, the board, wider industry and stakeholder to achieve this goal," Mr Moss concluded.
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Note for editors:
The annual statement would have a number of benefits, including:
- Provision of a clear overview of all the various pensions which an individual might have throughout their working life, including combination of private and State pensions;
- Giving each citizen a clear view of their entitlements on retirement; or highlighting the fact that individuals may need to increase their contributions.