The Association of British Insurers says the financial services industry still needs to earn the Government’s trust on auto-enrolment and prove it is acting in the best interests of clients.
Speaking at PIMS on board the Aurora last week, ABI director of life, savings and protection Stephen Gay said although auto-enrolment is a huge opportunity for providers, they are being subject to intense scrutiny from ministers.
Gay said: “There is a sense among policymakers that the industry has been handed a huge opportunity with auto-enrolment and it is up to us to show we are worthy of it.
“The Government has decided that its flagship pension reform is one in which the industry will play a major role but the financial services industry does not enjoy a good reputation in Westminster.”
Gay said ministers are not sure the financial services sector will act in clients’ best interests on auto-enrolment.
He said: “Nobody in Westminster is assuming that left to our own devices, we will do what is best for ordinary employees.”
Gay added the current pension policies, including auto-enrolment and pot follows member, are not enough to plug the pensions gap entirely, and urged the industry to come up with further solutions.
Quanton Hills Financial Planning managing director Gordon Bowden says: “It is fair enough to say the industry needs to earn the trust of the Government. Having learnt from the past I think there is a significant opportunity to make sure that auto-enrolment works for both employees and the industry.”