TISA says the next Government has an opportunity to significantly improve the financial wellbeing of UK consumers
TISA, the investments and savings membership organisation which represents over 170 leading financial service firms, has published its manifesto of policies and reforms it believes the next Government should consider if levels of consumer saving and investing are to be increased.
TISA members believe that the next Government has an opportunity to significantly improve the financial wellbeing of UK consumers. The proposals are focused on encouraging sustainable saving and on reducing the reliance on state provisions, especially for those retiring.
In the face of Brexit and geo-global political changes, TISA is working to ensure that the UK savings and investments industry thrives and is encouraging the next Government to:
• Create a robust and sustainable society founded on consumers having financial resilience and wellbeing
• Reduce dependency on the state and the burden on taxpayers, as citizens become more secure, better informed, and more financially confident
• Boost the economy through increased savings invested in infrastructure and job creation
• Transform the lives of those who are just about managing.
Tony Stenning, Deputy Chairman of TISA says:
“The next Government has a chance to address the woeful savings gap afflicting a large proportion of the UK. Whilst many people know that they should be saving and investing, it is simply not an option for some as their priority is to live day-to-day. Therefore, policy-makers and industry must continue to work together to develop ways to rebuild confidence and trust in saving and investing. Essentially, we need to create a culture where it is as easy to save as it is to get into debt.
“Unless action is taken now, we will reach a tipping point in 2035 when those entering retirement will be increasingly less well-off than earlier generations. Those who will be most affected are people aged 35 or younger as they face rising housing costs, less generous pensions and are saving less. If nothing changes we could be destined to benefit from longer, healthier lives, yet suffer financial hardship in old age.”
Following substantial research, the three areas where TISA believes long-term reforms are needed are Pensions, Financial Guidance and Technology.
Pensions
• Change the tax relief system to a single rate, matching contributions for Defined Contribution schemes with Government putting in £1 for every £2 of individual contribution
• Increase Auto-Enrolment contributions to 12per cent (whilst still minimising opt-outs) and include those individuals not currently eligible (for example, people at younger or older ages, those on lower incomes and those with multiple jobs)
• Develop a pension solution for the self-employed, such as enhanced state contributions
Financial Guidance
• Change the rules for financial guidance to enable financial services to provide millions more consumers with support in making financial decisions
• Establish a Single Public Financial Guidance Body that significantly enhances the results achieved by MAS, TPAS and PensionWise by creating a working partnership with the industry to deliver a demonstrable improvement to consumer outcomes
Technology
• Develop a Digital ID that helps consumers engage with their personal finances, and meets the requirements of firms needing to comply with AML and KYC requirements. TISA has successfully tested a Digital ID prototype that meets all regulatory requirements and is designed to work collaboratively with the Government’s Verify initiative. The pilot is planned for completion this year.
David Dalton-Brown, Director General of TISA concludes:
“Our recommended proposals are designed to create long-term benefits to the consumer. With the development of TISA’s strategic capability, policy development resource and technical support service, we can ensure that we are best placed to meet our objective to improve the financial wellbeing of UK consumers by aligning the interests of people, the financial services industry and the UK economy.”
“This year we have made significant additions to the TISA team with the appointment of Andrew Churchill as Digital Innovation Director and in other critical policy development areas. This is helping us to campaign on issues ranging from the inclusion of financial education on the primary school curriculum via the KickStart Money initiative, to raising the qualifying age for LISA savings to age 50 in order to help the growing number of older self-employed to save towards their retirement.
“We are also really excited about the development of a Digital ID which will help consumers to engage with their personal finances in an easy, accessible and efficient way. We believe that it has the potential to deliver major consumer and economic benefits by driving the development of UK’s FinTech economy. TISA will continue to work with its member firms, the Government and consumers to generate initiatives which support and foster saving and investment in the UK and globally.”
Ends
For further information please contact:
Alistair Kellie – Telephone: 0207 680 6558 / Email Alistair.Kellie@newgatecomms.com
Sara Neidle – Telephone: 020 7680 6550 / Email Sara.Neidle@newgatecomms.com
Jessica Hodson Walker – Telephone: 020 7680 6538 / EmailJessica.HodsonWalker@newgatecomms.com
Email: TISA@newgatecomms.com
Notes for Editors
TISA is a unique, consumer focused membership organisation. Our aim is to improve the financial wellbeing of UK consumers by aligning the interests of people, the financial services industry and the UK economy. We achieve this by delivering innovative, evidence based proposals to government, policy makers and regulators.
TISA’s growing membership comprises over 160 firms involved in the supply and distribution of savings and investment products and services. These members represent all sectors of the financial services industry, including asset managers, insurance companies, fund managers, distributors, building societies, investment managers, third party administrators, FinTech, consultants and advisers, software providers, financial advisers, pension providers, banks and stockbrokers.
Current themes of TISA policy work include:
• Brexit: developing proposals for government that will enable the savings and investments sector to prosper on a global scale
• Digitalisation: a digital identity for consumers of financial services, innovation, standards and data responsibilities
• ISA’s: LISA, simplification of the regime
• Retirement saving: the Auto Enrolment review, self-employed and pension tax relief
• Housing: the use of property to supplement retirement income
• Guidance: developing a framework and services to make guidance more widely available
• Education: supporting the education of young people to make them aware of the impact of finance on their life.
TISA also provides support on a range of operational and technical issues targeted at improving infrastructure and processes, standards of good practice and the interpretation and implementation of new rules and regulations. TISA has a successful track record in working cooperatively with government, regulators, HMT, DWP and HMRC to improve industry effectiveness by reducing cost and risk and to enhance customer outcomes. This work currently includes: MiFID II, CASS, the UK Fund Settlement initiative and Payments Strategy Forum. TISA Exchange (TeX) is providing a model for transfers and re-registrations.