TISA calls for Regulatory Alignment in Pension Projections to strengthen informed decision-making
Responding to the Financial Conduct Authority’s (FCA) consultation on Pensions: Adapting Our Requirements for a Changing Market (DP24/3), The Investing and Saving Alliance (TISA) is calling for greater consistency in pension projection calculations across regulatory frameworks. With digital tools and the Pensions Dashboard becoming increasingly central to consumer engagement, ensuring alignment in projected retirement outcomes is essential to maintaining consumer confidence and informed decision-making.
The evolving pension landscape has been significantly shaped by digital services, which offer new opportunities to engage consumers and enhance their understanding of long-term financial planning. Tools such as pension modellers and scenario-planning applications are playing an integral role in the decision-making process, particularly for the mass market. The proposed changes in the FCA’s discussion paper are a step in the right direction toward enhancing these digital solutions.
Commenting, Renny Biggins, Head of Retirement at TISA said:
“As the pensions industry continues to evolve, it is crucial that we provide a seamless and consistent experience for consumers across different regulatory regimes. With over 18 million active members in the Auto Enrolment framework, all individuals should have equal access to clear and reliable pension projections, regardless of whether their schemes are regulated by the FCA or The Pensions Regulator (TPR).”
The introduction of the Pensions Dashboard is highly anticipated and is expected to play a pivotal role in increasing engagement and confidence in pension saving. Consumers will soon be able to view their entitlements as projected retirement income using consistent calculations, as required by existing Financial Reporting Council (FRC) Statutory Money Purchase Illustrations (SMPI) rules. However, there remains a critical need to ensure that post-Dashboard modellers and tools follow the same core projection methodology to avoid confusion and potential misinformation.
Renny Biggins added:
“To ensure clarity and trust in pension projections, we must align core calculations across all digital tools, including Key Features illustrations, SMPIs, and modelling services and this review presents an opportunity to streamline these requirements. We also need flexibility to enable firms to innovate and develop engaging propositions that allow consumers to scenario plan, including the ability to change variables such as growth rates and view projected outcomes on a stochastic modelling basis
TISA urges policymakers, including the Department for Work and Pensions (DWP) and TPR, to collaborate with the FCA in driving alignment across pension regulations. Establishing a unified standard for pension projections will help consumers navigate their financial futures with confidence and clarity.
Read TISA’s full response here: https://www.tisa.uk.com/wp-content/uploads/2025/02/DP24-3-TISA-final.pdf