TISA urges Government to adopt a new manifesto for savings
TISA, the financial services membership association, has called for the Government to adopt a manifesto for savings to encourage and enable consumers to become more financially independent.
TISA was encouraged by the changes announced in the last Parliament around pension freedoms and improvements to ISAs. However, it is recognised that more needs to be done to tackle the UK’s unsustainable culture of consumption and debt.
In order to tackle this culture of debt, TISA has established a project – The Savings and Investment Policy project (TSIP) which is an unprecedented pan-industry grouping of leaders from across the UK financial services industry. The objective of TSIP is to move society towards adopting a savings-based culture where saving is encouraged, financial education is improved and the process of saving is made easier and rewarded.
Recently, TSIP published a detailed report, ‘Saving Our Financial Future’, which sets out strategic proposals for new savings and investments policies to help rebuild consumer confidence and trust in short, medium and long term savings. TSIP highlights how fifty years ago, the UK was a nation that saved for what it wanted and led the world in levels of pension savings. Since then, there has been a seismic shift in cultural attitudes where living for today has taken priority over providing for tomorrow.
In its submission to the Chancellor, TISA recommends a number of key policies:
• The creation of a Savings Minister who is responsible for developing and implementing a coordinated savings policy across all Government departments.
• Part of the Savings Minister’s role would be to support and encourage the development of TSIP’s Digital Passport initiative, which will give consumers greater control over their savings and investments and make it easier to buy and transfer financial products.
• Introduce a Workplace ISA, to sit alongside the existing workplace pension savings schemes to provide greater choice for savers through a product that is simple and trusted.
• Pension rules should be simplified and made easier to understand. This would include scrapping the lifetime limit and replacing it with an annual allowance, introducing Automated Transfers to eliminate the proliferation of small pensions pots that auto-enrolment would otherwise bring, and to drive up auto-enrolment pension contributions to reach 15%.
• Improving access to financial guidance and education for all is critical to reversing the UK’s culture of consumption.
David Dalton-Brown, Director General of TISA said: “We were very encouraged by the changes around pension freedoms and improvements to ISAs made under the last Parliament. We think it is a healthy instinct to trust people with their own money, and to encourage them to save for the future, whether through a pension or other options, such as ISAs.
“However, there is still a long way to go and we are determined to continue to play our part in transforming society from one of consumption and debt, to a culture of prudent savings and financial planning. We believe our recommendations will build on the recent reforms and help to create a manifesto for savings for this Parliament.
“There is an opportunity for Government and the entire financial services industry to work more closely together to secure the financial wellbeing of future generations. It is the responsibility of financial service firms, with the support of government to encourage consumers to save and focus on rebuilding confidence and trust in saving and investing.
“Narrowing the savings gap is crucial to ensuring national economic growth, stability and prosperity. Saving benefits everyone and is of critical economic and social importance.”
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Issued on behalf of TISA by Newgate Communications, for further information please contact:Sara Lyons – Telephone: 020 7680 6550 / Email Sara.Lyons@newgatecomms.com
Notes for Editors
TISA is a not-for-profit membership association operating within the financial services industry. We represent the interests of over 147 member firms involved in the supply and distribution of savings and investment products and services.
TISA has a highly successful track record in working cooperatively with government, regulators, HMT, DWP and HMRC to improve the performance of the industry and the outcomes for consumers. Policy and regulation continues to be the major focus for our members with regard to corporate responsibility.
TISA and its members’ remit is evolving into a clearer focus on pro-active consultation in the regulatory world in order to influence policy and associated regulation before its creation, rather than reacting to issued policy directives. This will help to ensure a more considered policy creation from the authorities.