Standard Life is calling on the Financial Conduct Authority to simplify its pension rules for auto-enrolment to avoid confusion among employers and employees.
Existing pre-auto-enrolment rules mean prospective members receive key product information on contract-based schemes before they make a decision to join. The information is designed to help them make an informed decision about the pension contract they are entering.
Members who are auto-enrolled then receive post-sale disclosure documents from the Department for Work and Pensions.
Standard Life head of workplace strategy Jamie Jenkins argues that these two disclosure documents overlap.
He says: “With the new obligation upon employers, eligible employees are enrolled automatically and so are not making the decision to join. They have been opted in and have to consider whether they want to remain in the pension.
“To avoid confusion for employees and employers, we would like to see the auto-enrolment obligation supersede the need to provide product information pre-auto-enrolment and permit it to be provided afterwards.”
He adds: “Based upon the positive response from regulators to date, we hope we can improve this element of auto-enrolment.”
Last month, FCA director of enforcement and financial crime Tracey McDermott admitted that the regulator’s costly disclsoure rules had failed.
FortyTwo Wealth Management partner Alan Dick says: “If the FCA is overloading people with information, all it is really doing is harassing people. Disclosure has to be clear and transparent, and more disclosure without clarity just ends up confusing customers.”
The FCA was unavailable for comment.