The National Association of Pension Funds has become the Pensions and Lifetime Savings Association. What will this mean for its members?

The National Association of Pension Funds (NAPF) will become the Pensions and Lifetime Savings Association (PLSA) in a landmark bid to keep in step with recent changes in the market.

“If the world is changing, we need to change too,” said Joanne Segars, chief executive of the PLSA, speaking at the organisation’s press launch.


Joanne Segars launching the Pensions and Lifetime Savings Association at the NAPF conference today

Pensions are not so much changing as in the middle of a total revolution. Auto-enrolment, freedom and choice and potential wholesale tax reform are all factors in an employee benefits revolution. Segars, in consultation with the NAPF’s members, has decided to “look beyond pensions” and reach out to new members who may fall outside the NAPF’s traditional stomping ground.

It’s an interesting and highly ambitious move at a time when, thanks to freedom and choice, retirees are free to keep their money within the traditional institutional world or use it to buy a retail product. Annuity providers will now have to fight with the likes of Saga holidays, ISAs and good, old-fashioned bricks and mortar for pensioners’ hard-earned savings.

Even during the savings phase, competition with retails products is increasing. A potential shift to a ‘tax, exempt, exempt’ system would align pensions more strongly with ISAs and could prompt employers to offer more holistic savings vehicles, of which a pension will only be a part.

Segars said: “Retirement simply doesn’t look like it used to – today people work later in life and they fund their retirement in all sorts of ways. The lines are blurring between work and retirement, between pensions and other forms of saving and between scheme and saver responsibility.”

Preserving its heartland

An important question is how the PLSA, an organisation heavily involved in lobbying on behalf of pension schemes, will be able to campaign coherently across a huge range of different members without alienating its heartland.

The organisation has confirmed that its lobbying remit will broaden. In a statement it said: “Our lobbying work, research and thought-leadership on policy and legislation have to look beyond just pensions. We’ll have to consider the role property, work and other savings play in funding retirement.”

Property is a market that the PLSA will be scrutinising closely, said Graham Vidler, the PLSA’s director of external affairs. “The equity release market is very important,” he said, pointing out that people cannot live in their house, pass it to their children and also take income from it simultaneously.

Perhaps surprisingly, the NAPF has no plans to expand its team to address the new areas it will cover. The association plans to use its research budget, build its existing team’s expertise and partner with other, non-pensions entities to drive activities, Vidler said.

The big question remains: can such a broad membership be fairly represented by one organisation? Worse, as defined contribution grows and defined benefit declines, might defined benefit schemes find themselves left behind?

Segars was keen to emphasise that the members who have been consulted thus far were happy with the course the organisation is taking. “Whenever we are developing our policies we talk to our members and get a synthesis of views,” she explained. “For any member organisation it is always about discussion and debate and making sure you reach that common position.”

Segars was speaking immediately prior to the recent turmoil at the Investment Association. Large asset managers including Schroders and M&G threatened to leave over the IA’s policy direction, leading to the resignation of its chief executive, Daniel Godfrey.

Sources close to the situation said that Godfrey’s mistake was to fail to listen to the IA’s membership, pursuing transparency on cost disclosure while failing to represent members’ other concerns, such as the direction of European regulation. Meanwhile, Godfrey’s supporters have argued that he was right to try to bring his members more closely into line with popular sentiment and that the principles on the table were hardly radical.

Whatever the rights or wrongs of the situation, Godfrey’s abrupt exit will no doubt have reminded Segars of how crucial it is for a membership organisation to keep its members on side.

The NAPF represents a powerful cohort of employers and the success of pension provision will continue to hinge on their making quality provision for scheme members.

The new PLSA’s challenge will be reconciling their interests with those of a new cohort of members with an extremely broad set of ambitions and agendas.

This is clearly a bold and ambitious step for the organisation to take. The world is changing and it is important for the PLSA to stay relevant.

Whether it will be possible for the PLSA to retain a coherent voice and keep all its members happy remains to be seen.