The role of pension provision is likely to diminish as consumers demand more flexibility and a broader range of benefits, and employers demand more immediate engagement in benefit spend, say advisers are warning.
Damian Stancombe, director of P-Solve, says attitudes toward saving and spending into today’s culture have changed people’s view of pensions unalterably.
“Pensions as part of remuneration will become less important as the decade progresses. If I was in business and I want reward spend it is not on a pension, it’s on the here-and-now and there are a lot more products that are here-and-now focussed, compared to pension,” he says.
Dick Stratton, partner at Mercer, agreed. “It will be more about young people saving in share plans, diversifying and then maybe putting into Isas and pensions, maybe, in due course,” he said.
Andy Marchant, corporate managing director at Aegon Scottish Equitable, argued there are contrary forces at play when it comes to workplace offerings. He said: “Pensions will remain a core part of what is offered in the workplace but they won’t be the only part and, particularly for larger employers, will form part of a more complicated range of benefits but a lot of that will depend on tax arrangements.”
