The public must be brought into decisions about the future of UK pensions if the system is to deliver fair and sustainable retirements, according to a report commissioned by a cross-industry group.
The project was backed by the New Citizen Project and funded by the Standard Life Centre for the Future of Retirement, which has labelled ongoing issues in the industry as a “pensions crisis”.
Further members of the cross industry group were The Institute and Faculty of Actuaries, Pensions UK, People’s Pension, Nest Pensions, Nest Insight and consumer rights expert Johnny Timpson.
The “Deliberative Democracy & Pensions” report argued that, as individuals increasingly bear responsibility and risk for their retirement outcomes, any new pensions settlement must be shaped by the citizens whose futures depend on it.
With the Pensions Commission tasked with improving private pension adequacy and addressing the financial challenges faced by underserved groups such as lower earners, the report suggests that citizen involvement can strengthen policymakers’ understanding of what the public considers to be a fair and sustainable pensions system.
A central recommendation of the report is the commissioning of a Citizens’ Assembly on the future of UK pensions. This would be intended to support the work of the Pensions Commission and inform decision making by the Department for Work and Pensions.
Catherine Foot, director of The Standard Life Centre for the Future of Retirement, says: “Public involvement and consultation are not new to pensions policy. Following the recommendations of the 2006 Pensions Commission, the Department for Work and Pensions commissioned the National Pensions Debate. But what has changed is the sophistication of deliberative methods and our understanding of how they can support complex policymaking.
“Today’s pensions challenges involve difficult trade offs and long term consequences. Deliberative approaches stand out for their ability to support the public to engage with these issues in a meaningful way, helping policymakers to ground reform in public values as well as technical evidence.”
Deliberative democracy is designed to bring together a representative group of the public, support them to understand complex issues, hear diverse perspectives and weigh evidence based trade offs. This in theory enables people to develop informed, considered views, and can provide policymakers with a clearer sense of genuine public consensus.