The Pensions Regulator (TPR) has said its call for input with the Financial Conduct Authority (FCA) was prompted by a desire to change the system to suit the shifting landscape of pension savers in the UK.

TPR interim director of strategy and risk, Richard Edes, listed a number of examples of these changes, pointing out that life expectancy rose by 13 years for women and 10 years for men between 1951 and 2011, while the proportion of people who identify as a non-white ethnic group increased by 8 percentage points between 1991 and 2011.

Additionally, he highlighted the rising number of women in employment and the fact that defined contribution (DC) savers outnumber their defined benefit (DB) counterparts by 15 to one as further key changes.

Edes said: “For previous generations, pensions were typically for the higher-earning few or those with a more paternalistic employer. They saved largely into DB pension schemes with a guaranteed income and employers taking more of the risk.

“Today, thanks to automatic enrolment, millions more savers are putting something away for their retirements. But they are increasingly doing so through DC schemes, with savers carrying more decision-making risks – whether they know it or not.”

The regulator said this was why it had joined with the FCA in seeking views on how the consumer pensions journey can be improved and how savers make pension decisions at key points throughout their working lives.

Edes commented: “From behavioural biases meaning people struggle to make decisions now about outcomes that are many years ahead to personal milestones such as marriage or home ownership, which prompt wider thoughts on finances in later in life – the issues are often not easily solved.

“Perhaps even more difficult are the various, structural, societal issues which manifest within pensions, for example: the large gender pensions gap in the UK; that some ethnic minority groups are much less likely to be saving into an automatically enrolled pension; and how multiple shifts between employment and self-employment, for whatever reason, can cause savings journeys to be interrupted or stopped entirely.”

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