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Press comment: Government right to explore different approaches to the self-employed savings conundrum

18/12/2018

If you are covering the DWP’s paper on the new ways to stimulate retirement saving among Britain’s 4.8 million self-employed, please see the following comment from Jon Greer, head of retirement policy at Quilter:

Jon GreerSince last year’s snap election and the subsequent scramble of policy promises, the Tory party has been accused of flip-flopping, u-turning and reneging on several of their political promises. While that is certainly not something to boast about, what is worthy of merit is reflection on whether policy promises are practical and in the best interest of the public.  

Among the Tory’s promises was a pledge to extend auto-enrolment to the self-employed in their manifesto. However, following a considered review and reflection it is apparent that promise was made without all the facts. For instance, the lack of pension saving of the self-employed is not necessarily due to apathy, it is because they fundamentally have a different approach to savings. For instance, many people who are self-employed regardless of their salary have to grapple with a lack of certainty and security of their income month to month.  This can make the idea of committing money into a pension pot that can’t be accessed for years to come seem like a potentially risky decision.

A ‘sidecar’, which is a pool of money made accessible at any age in times of need could provide a flexible approach for a group that desires flexibility. This is just one of the trials being explored for employees by NEST insight. However, it could equally be targeted at the self-employed  and it is that kind of innovation that will ensure that they are given the best possible chance of prosperity in retirement.  

Auto-enrolment for the self-employed may not have been within the Government’s grasp as there is no employer to do the ‘enrolling’.  Had the auto-enrolment criteria been overlaid on the self-employed it would have captured about 2 million* of the over 4.8 million strong population. So it is not only positive, it is vital that the government  explore every possible avenue to bring the self-employed into pension savings.

*Policies for increasing long term saving of the self-employed, conducted by the Pension Policy Institute on behalf of Old Mutual Wealth

For more information contact

Alex Berry023 8072 626007741 151931alex.berry@quilter.com

Notes to editors:

About Quilter plc:

Quilter plc is a leading wealth management business in the UK and internationally, helping to create prosperity for the generations of today and tomorrow.

Quilter plc oversees £114.9 billion in investments (as at 31 March 2019).

It has an adviser and customer offering spanning: financial advice; investment platforms; multi-asset investment solutions; and discretionary fund management.

The business is comprised of two segments: Advice and Wealth Management and Wealth Platforms.

Advice and Wealth Management encompasses the financial advice business, Quilter Financial Planning; the discretionary fund management business, Quilter Cheviot; and Quilter Investors, the Multi-asset investment solutions business.

Wealth Platforms includes Old Mutual Wealth UK platform; Old Mutual International, including AAM Advisory in Singapore; and the Old Mutual Wealth Heritage life assurance business.

The Quilter plc businesses are being re-branded as follows: 

  • Quilter Financial Planning (previously Intrinsic)
  • Quilter Private Client Advisers (previously Old Mutual Wealth Private Client Advisers)
  • Charles Derby Group (becoming Quilter Financial Advisers)
  • Quilter Financial Adviser School
  • Quilter Cheviot
  • Quilter Investors
  • Old Mutual Wealth (becoming Quilter Wealth Solutions in 2020)
  • Old Mutual International (becoming Quilter International in 2020)

This press release is for journalists only and should not be relied upon by financial advisers or customers.

Please remember that past performance is not a guide to future performance. The value of investments and the income from them can go down as well as up and investors may not get back any of the amount originally invested. Exchange rate changes may cause the value of overseas investments to rise or fall.

This communication is issued by Quilter plc.  Registered office: Millennium Bridge House, 2 Lambeth Hill, London EC4V 4AJ, United Kingdom. Registered number: 6404270.  Registered in England.