11 July 2024
If you are covering the news that Emma Reynolds has been appointed as Pensions Minister, please see the following comment from Jon Greer, head of retirement policy at Quilter:
“Despite being out of government for 14 years, Labour has opted for an experienced parliamentarian as its Minister for Pensions, with the appointment of Emma Reynolds. While she has little pensions experience to speak of, she has previously served in parliament for nearly a decade prior to her re-election last week. Furthermore, her most recent experience being at TheCityUK financial services trade association should give her a good starting point from a knowledge perspective and provide potential to grow into the role. With experienced hands such as two-time Minister for Pensions Sir Stephen Timms also being appointed at the Department for Work and Pensions, we hope this will give stability to an industry that is so vital to the health and economy of this nation.
“This appointment does give the view that Labour will treat pensions with the thought and consideration that is required, not least because the role is a joint appointment with the Treasury and DWP. Given the importance and complexity of pensions, it is positive to see the role being recognised for having implications across departments. After a number of years of pensions being used as a political football, we hope Labour’s huge majority will give it enough cover to sensibly plan reform and improve upon the current regime where possible.
“While her pensions experience may be lacking, in her previous stint in parliament Reynolds has shown some understanding of the issues facing the sector – including debating on the implementation of the pensions dashboard and pension credit reforms. She will now use that experience to take forward Labour’s plans to review the pensions landscape. It is critical that this results in more people saving for retirement and there are levers that can be pulled to help achieve this, notably around automatic enrolment and extending access while also adjusting contribution thresholds.
“There is also political desire across parliament to stimulate the UK economy and its financial centres. As such, we are likely to see a continuation of Jeremy Hunt’s Mansion House reforms to push pension funds to invest more in UK assets. It will be interesting to see what steps Labour’s pension review will consider to increase productive investment in the UK economy and to encouraging a greater home bias in asset allocation decisions.
“We know from Labour’s manifesto that the state pension triple lock will be maintained. But this is likely to come under more and more pressure, particularly given the state of public finances and demographic trends. We need policy that works for the long-term and a state pension uprating system that is pegged to average earnings would be a fairer option that should make the state pension sustainable for future generations. With such a healthy majority we would want to see bold action from Emma Reynolds to start a debate about the future of the triple lock and just how sustainable it can be.
“Outside of Sir Steve Webb and Guy Opperman, the pensions industry has had to put up with an ever-revolving door of ministers. Even someone experienced like Sir Stephen Timms himself never made it to a year in charge in his previous two stints. Hopefully Emma Reynolds can come in and provide some stability over the course of this parliament, especially when it is people’s retirement and ability to maintain living standards in old age that is at stake.”
