Chloe Smith, MP for Norwich North was yesterday named as Secretary of State at the Department of Work and Pensions.
Steve Butler, CEO of Punter Southall Aspire, comments:
“I’d like to congratulate Chloe Smith on her appointment. The Department of Work and Pensions, as with the whole government, has a full in-tray.
“The pensions system is critical to the UK’s financial wellbeing. The cost-of-living crisis will inevitably impact the living standards of retirees and deter people from saving for the long term – we are already seeing evidence of this. It is vital that the government provides help to people during this crisis, but I also want to see the government tackle structural issues within the pensions system to improve and encourage lifetime savings in Britain.
“There are three major issues that the new Work and Pensions Secretary must address.
“Auto-enrolment rules need to be changes to help address the gender pension gap and help women save more. The system should be altered so that, for example, if a woman is on a career break to look after children, her partner can pay into her pension pot even though she’s not working. The minimum age and salary level at which you can be auto-enrolled should be lowered so that younger or part-time workers can save, which will help women too.
“The rules for accessing pensions savings and annual savings allowances must be more flexible to reflect that we’re living longer and spending more time in retirement. The Money Purchase Annual Allowance is a major blocker to true pension freedom and it should be reformed so that people aren’t penalised for accessing their long-term savings.
“The Department must build greater awareness of the Pension Tracing Service to help people locate their lost pensions. There is nearly £20bn in unclaimed pensions, so the government should be doing more to encourage people to find their misplaced savings.”