A new era in UK pension policy

It’s been revealed who has been appointed as Pensions Minister in the new Labour government, following their General Election victory on 4 July.

When I initially learnt that Sir Stephen Timms had been appointed as a Secretary of State for the Department for Work and Pensions (DWP), I immediately assumed that he would take up the role of Pensions Minister for the third time in his parliamentary career. But instead, Emma Reynolds, the MP for Wycombe, has been appointed as the new Pensions Minister.

Bridging the gap between the DWP and HM Treasury

What is different this time around, however, is that Ms Reynolds has a joint ministerial role across both the DWP and HM Treasury, with her expected to work on pensions policy across both departments. 

My hope is that her appointment will foster a more ‘joined-up’ approach to pension policy across both the Treasury and DWP.

Readers will recall how, when it comes to pensions, the two departments have often pulled in different directions, which frustrated both providers and advisers. Therefore, it’s crucial that we have someone who can synchronize objectives and ensure the departments work together cohesively. This approach should help ensure greater consistency in developing future policies and laws.

The King's Speech: Pension Schemes Bill

In contrast to the disturbing election-related events taking place in France and, more recently, the United States of America, the transfer of Governmental power from the Conservatives to Labour was orderly, uncomplicated and, (dare I say) genteel.

Indeed, this was demonstrated during the King’s Speech. To the surprise of many, the King’s summary of the various items of legislation to be debated in the new parliamentary session did include a Pension Schemes Bill, and the new Chancellor of the Exchequer, Rachel Reeves, wasted no time in launching a ‘landmark review’ into pensions. 

Rachel Reeves' 'Landmark Review'

Reeve’s set out her ‘landmark review’ as something that would “boost investment, increase pension pot sizes, and tackle waste in the pensions system”.

It’s going to be delivered in two stages: the first stage will focus on ‘productive investment’ including scheme consolidation and encouraging ‘broader investment strategies’. It will be led by the new Pensions Minister. 

The second phase, which will begin later this year, will examine ‘how to improve pension outcomes and increase investment in UK markets’. This builds on the promise contained in the Labour election manifesto, of ‘a full review of the UK pension landscape’.

Looking ahead

Following this announcement, the Chancellor and the Pensions Minister then chaired a roundtable with the pensions industry to kick-start its engagement with the review. 

So far, so good. However, it’s still early days and it will be interesting to see how the new Pensions Minister fares whilst spinning her two departmental plates.