In my last Pensions Expert column, I wrote about the challenge for the new Pensions Minister in balancing short-term political expediency with truly progressive pensions policy.

If we are to achieve long-term sustainable retirement provision, policy needs to be aligned with long-term objectives rather than short-term vote-winning.

There have been calls from some quarters for the new Pensions Minister, Ros Altmann, to consolidate the changes made under Steve Webb and his predecessors and resist radical reform. Yet affordability of pensions is one of the UK’s biggest challenges.



Let's ask the tough question – who will pay for future provision?

According to a 2013 European demographic research report by Amlan Roy at Credit Suisse, health and pension expenditures are projected to grow close to 20 per cent of GDP.

This is unsustainable.

The government not only has to support a larger group of retirees – baby-boomers entering retirement – but it also has to support them for a longer amount of time. This has both immediate and long-lasting consequences on health care, long-term care and the pensions expenditures of governments.

We all want a certain and comfortable retirement, but the majority of us do not want to adapt to disciplined saving.

Why not?

Are we unsure about what we want, or do we lack the culture and collective mindset to overcome our need for short-term gratification? This is a collective problem for individuals, companies and government; it should be in our mutual interest to solve it. Only a few nations embrace the ‘save today to finance a better tomorrow’ culture. These include Norway and Singapore: nations that exemplify long-term financial planning and thinking.



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This post first appeared in Pensions Expert on 3rd June 2015 and is reproduced with kind permission.


Author: Robert Gardner

Robert is Co-Founder and Non Executive Director at Redington Ltd. He started his career at Deutsche Bank before joining Merrill Lynch in 2003, working as Director in their Insurance and Pensions Solutions Group. In 2008, Robert also co-founded Mallowstreet, the online pensions community which continues to grow with presence and support from the industry. Robert is passionate about the impact of social media on business believing that education, collaboration and contributions are the best way to tackle pension challenges. In January 2019, Robert joined St. James's Place Wealth Management as Director of Investments.