Defining ambitions: Shaping pension reform around public attitudes
Queen's speech indicates IPPR-style collective pensions are closer to reality for Britain's saversArticle
Reform is underway to encourage people to work for longer and to save into a pension. However, contributing at the rates required by auto-enrolment across a full working life will give the current generation of employees a less than 50:50 chance of a decent income in retirement. New pension products and strategies are urgently needed to protect future living standards.
This report uses original qualitative research to explore the key barriers that are preventing people from engaging with pensions, and the underlying principles that they want from a pensions system, before assessing whether defined-ambition pension models could address these challenges and priorities.
It finds that public investment in pensions is being held back not by affordability alone, but by distrust of the institutions involved (including concerns that the government will 'move the goalposts'), a general lack of understanding about pensions, and the related fear of making the wrong decision. This demonstrates that better communication strategies, stronger governance structures, and long-term, cross-party commitments to policy are all essential components to successful reform.
Based on public attitudes, this report provides three core recommendations that policymakers and the industry should incorporate into the defined-ambition agenda:
- Ask members to set a target pension income.
- Offer protection against volatility by making a smoothed pension a lead option for auto-enrolment.
- Introduce a 'collective defined contribution' pension to the UK.
Related items
Dr Parth Patel on BBC Politics Live - July 2024
IPPR's Dr Parth Patel on BBC Politics Live discussing the new Labour government, Covid, migration and international affairsA ‘mandate’ to deliver: Who voted Labour and what do they want?
This year’s general election saw the Labour party achieve a historic landslide, winning 218 new seats and a comfortable majority in the House of Commons.Half of us: Turnout patterns at the 2024 general election
One-half of adults in this country voted at the 2024 general election, the lowest share of the population to vote since universal suffrage.