Convoluted pension statements are set to be a thing of the past, according to the Department for Work and Pensions (DWP).
This week, pensions minister Guy Opperman has unveiled plans for simple, annual pension statements.
The DWP proposals will require pension schemes to provide the two-page statements and structure them in such a way that draws members’ attention to the following key pieces of information:
The initial focus will be on defined contribution schemes used for automatic enrolment, with a view to later improving consistency across all schemes.
Opperman said: "For too long pensions have been shrouded in complexity and technical jargon, limiting people’s understanding of their savings and hampering their retirement planning.
“Simple statements will usher in a new standard for how schemes communicate with their members – vastly improving people’s understanding and engagement with their pensions.”
Former pensions minister Ros Altmann is pleased with the decision to introduce simpler statements, but said they should be promoted and explained in a national public information campaign.