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Yes minister - Consumer champion Ros Altmann named pensions minister

Posted on 15 May 2015 by Chris Torney

Perhaps the most eyebrow-raising appointment in David Cameron’s new cabinet this week was that of Dr Ros Altmann as pensions minister.

Dr Altmann, who is to be made a baroness in order to sit in the House of Lords, had the role of “business champion for older people” in the coalition government, and was expected to be made consumer protection minister if the Tories took power in the general election.

However, the decision to put her in charge of the country’s pension system at a time of great upheaval makes sense given her background as a pensions adviser and campaigner for consumer protection.

Dr Altmann’s appointment has overall been welcomed by consumer groups and the pensions industry alike. But her views in the past have generally been more closely aligned with the interests of the former than the latter.

The first many people had heard of her was around a decade ago when she fought tirelessly and selflessly to get justice for thousands of people who had lost most or all of their retirement savings when their employers went bust. Dr Altmann played an important role in getting the Pension Protection Fund (PPF) set up as well as in forcing the Labour government to offer compensation to those whose losses predated the PPF.

More recently she has worked to highlight the importance of keeping people in work later in life and to tackle the obstacles that older workers face.

So what can we expect from the new pensions minister in terms of policies?

Given the changes that have been introduced recently or which are due in the next few months, she can be forgiven for keeping any fresh tinkering in the system to a minimum.

In her first official statement this week, Dr Altman confirmed this approach, saying:

“I will take forward work to bring in the new State pension, help millions more to be enrolled into good quality workplace pension schemes, and safeguard new freedom and choice as to how people access their savings.”

Next April will see the introduction of the new flat-rate State pension system, while the government will be carefully monitoring the impact of April’s changes to the way people are allowed to take their retirement income.

These changes are taking place against the backdrop of the auto-enrolment pension scheme, in which millions of workers will be put into company pension plans unless they opt out.

If Dr Altmann can ensure that each of these three policy strands runs smoothly, she will be doing an excellent job.

But what else might we expect?

She has been a strong critic of the opaque and often high charges attached to many pension funds, so providers could see new rules introduced to enforce greater transparency.

Dr Altman has voiced support for George Osborne’s recent plan to allow existing pensioners to cash in their annuities – this is currently under consultation although many firms are opposed to the idea.

And the new minister is also more likely to investigate the possible past mis-selling of annuities, which again is unlikely to thrill providers.

Overall, Dr Altmann looks set to carry on the good work of her predecessor, LibDem Steve Webb. But it will be intriguing to see to what extent her consumer-champion approach can endure when it clashes with the interests of Britain’s powerful pensions industry.

Category: Industry news
Tags: pensions

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