You are here

Half of employers expect staff to need extra guidance on pensions

A majority of employers are broadly positive about the governments pensions overhaul but 50 per cent believe they will need to provide extra guidance to staff.

10 December 2014

Add comment

The government recently announced that all savers will be entitled to advice from impartial organisations on their options once they reach the age of 55, but findings from research conducted by Close Brothers Asset Management suggests employers don't think this will be enough.

A further 43 per cent of respondents to the survey recognised the need to provide ongoing pensions guidance to staff throughout their career.

Jeanette Makings, head of financial education services at Close Brothers, commented: "The 'guidance guarantee' and its execution has been a key talking point since the budget, but it's clear that as it currently stands, there will be a number of organisations - some of whom are already providing financial education and at retirement support and others who want to - that will go above and beyond this.

"They recognise that taking responsibility for providing guidance not only sits comfortably within their culture framework but that financial education programmes can deliver results for the business as well as individual employees in terms of engagement, wellbeing and productivity."

Companies in the manufacturing sector expect the highest demand for workplace guidance on their staff's pension options, with 67 per cent of employers in the sector expecting to provide extra guidance.

This compared with 57 per cent of employers in the pharmaceutical sector and half of employers in professional services firms, who expect that they will have to provide extra guidance.

Lack of awareness

There have been recent fears that due to the wholesale changes to pensions and the ensuing confusion, the existence of the government's free pension's guidance will become lost in the 'noise of confusion'.

The Treasury recently commented: "We are working on a range of ways to raise awareness of the pensions guidance service and encourage people to engage with it, complementing the requirement on pension schemes to signpost individuals.

"As part of this, the Treasury and DWP are considering if state pension forecasts could be used to help raise awareness of the guidance service."

The Treasury also said that a duty will be placed on pensions providers to inform savers about the free guidance during their correspondence with customers.

Categorised in: