In this edition of The Briefing from Informed Choice on Wednesday 5th September 2018 – pensions dashboard update, influencers drive spending, second trillion dollar club member, dissatisfied with banks, and economic reform required.
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Pensions dashboard update
Work and pensions secretary Esther McVey has announced the long awaited pensions dashboard will be delivered by industry. Under government plans for a pensions dashboard, savers would be able to view all of their pension savings and state pension benefits in one place. After initially wanting the pensions dashboard to be delivered by an industry working group, the Department for Work and Pensions took control. Earlier rumours suggested the DWP wanted to abandon the plans altogether.
McVey said:
The pensions landscape is transforming and the dashboard offers a great opportunity to give people straightforward access to their pension info in a clear & simple format – bringing together an individual’s savings in a single place online.
It is clear there is broad support for the concept of a dashboard and its potential to empower those putting money away for their futures. By taking a leading role, and harnessing their knowledge, industry can develop a dashboard that works for pensions holders – and government will help facilitate this.
Influencers drive spending
New research shows 53% of 15-24 year olds say their bank balance would be in better shape without social media temptation. The research from Barclays suggests that each 15-24 year old is spending an average of £33.23 a month on purchases directly influenced by those they see online. Over half in this age group say their bank balances would be in better condition without social media. However, this isn’t a case of an entirely frivolous generation throwing their money on just anything. 27% said they absolutely have savings goals that they’d like to work to in the future with 52% saying social media platforms should be more positive and encouraging of young people to save money. Looking at the three in ten (30%) that have admitted to using money they had earmarked for savings and the average spent on impulse each month, there’s a collective £900m missing in young people’s savings.
Second trillion dollar club member
Amazon has become the second US business to join the $1 trillion club. Its share price has more than doubled in the past year. Amazon generates $178bn in revenue each year. The valuation comes just weeks after Apple became the first trillion dollar business in the world. Amazon and Apple now make up more than 8% of the total value of the S&P 500 index.
Dissatisfied with banks
As TSB chief executive Paul Pester resigns, a new survey of UK current account satisfaction reveals widespread concerns with the sector. Only 72% of all current account customers are happy with their bank, with millions of customers feeling at risk of cyber fraud, IT failure or having experienced poor service in the last 12 months, according to new research.
The research, commissioned by GoCompare Money, looked at customer satisfaction levels of the major current account providers. TSB customers were the most disgruntled with 16% considering switching provider. They were also the least likely to have any trust in their bank or confidence in its IT or fraud protection systems. Earlier this year, problems with a system upgrade at TSB left many customers locked out of their accounts and saw some become victims of fraud.
Georgie Frost, consumer advocate for GoCompare said:
The level of customer dissatisfaction, particularly among younger age groups must be a real concern to current account providers. Historically, people tended to open a bank account as a teenager, then stick with the same bank for life. However, in recent years technology has made current account comparisons and switching easier and the seven-day switch guarantee scheme has made the process quicker.
Following TSB’s IT disaster which left thousands of its customers locked out of their accounts, we saw a massive increase in the number of people using our current account comparison service and, judging by this research, there are many more dissatisfied customers looking to move their accounts.
Economic reform required
A new report from the Public Policy Research’s Commission on Economic Justice has concluded that the UK economy needs a series of fundamental structural reforms. These include more rights for workers, greater state investment and powers for regulators to break up monopolies. The Commission has been analysing aspects of the UK economy for the past 18 months. It argues in its final report it is necessary to ‘hard-wire’ justice into the economic system, rather than treating it as ‘an afterthought’. According to the Commission, “A fairer economy is a stronger economy.”
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