The most important factor for building the public’s trust with the pensions industry is better communication, research from Trafalgar House has found.

Its Trust and Confidence Index surveyed people on their level of trust in pensions, and how this was influenced positively or negatively by factors such as friends and family, personal experience and the media.

The most recent survey found that there was an increase in the public trust score for the fourth year running, up to 5.26 out of 10.

The proportion of people citing clear communication as the most important factor for building trust and pensions rose by 41 per cent year-on-year to 16.5 per cent.

Face-to-face interactions remained important for many respondents, achieving the highest score for trusted interactions, although, outside of financial advice, face-to-face communication with pension providers was relatively rare, Trafalgar House noted.

While overall trust had increased, the proportion of members saying their experience was either ‘very positive’ or ‘fairly positive’ fell from 54.1 per cent to 46.3 per cent over the year, the first time it has fallen below the 50 per cent mark.

Clarity of information was found to be the most important factor for people in how they rate their interaction, with 41.4 per cent of those whose interaction was positive citing this as the main reason.

On the other hand, 30.5 per cent also cited clarity for their negative experience.

While online communications compared “reasonably well” to more traditional hard-copy communications, they have overtaken post as the area of communication with the highest level of mistrust (12.4 per cent).

Trafalgar House found that while the impact of people’s personal experience had remained “static” since 2022, there was an increase in the positive influence of friends and family (3.2 per cent), as well as the transparency shown by the industry (3.9 per cent).

However, it said that the “most concerning figure” was the continuing negative influence of media coverage, which, although it has dropped by 5 per cent, still has the highest negative impact at 35.4 per cent.

“The notion of interaction and communication when it comes to pensions is a grey area,” commented Trafalgar House technical & communications manager, Karla Bradstock.

“For some, interacting with their pension simply means opening and reading their annual benefit statement, while for others it could mean changing investment strategies or planning their retirement. Whatever the purpose, it’s essential that they have a positive experience to maintain trust and engagement.

“Technology is also becoming more prevalent with more than one in five (22.3 per cent) saying the availability of an app or website is the most important factor for them – up from 21.4 per cent.

“But with technology also comes mistrust, as we have seen. This could be due to the rise in media coverage on scamming. This awareness isn’t a bad thing, but as an industry this is something we need to address – that members can trust their online interaction is safe and secure and we are empowering them to spot the signs of scammers.”

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