Australia and UK to shape retirement landscape
Monday, 14 March 2016 12:39pm

A global pension expert believes both Australia and the UK will play a major role in driving future ingenuity and innovation for retirement markets across the world.

On the eve of attending the Conference of Major Superannuation Funds (CMSF) in Adelaide, J.P. Morgan managing director and global pensions executive Benjie Fraser said the way the two regions cover and think about their pension systems paints an interesting picture.

London-based Fraser said pension innovation in the UK currently seeks ideas from Australia's defined contribution system but that is going to turn around.

He said the UK will hand down its 2016 budget during CMSF and the global pension industry will be watching closely. This is especially because the UK created "pension freedoms", removing compulsory annuities from its system.

Fraser added people in the UK will still have to accumulate and decumulate, but what will be watched closely is the restrictions and access to the system. He said the UK does not want to create something too complex for people not to make any retirement decisions at all.

The pensions expert said something Australian bank technologists did well was create a solution to view and manage a person's net wealth in the one platform.

"I would see UK banks investing time and resources in building the same technology and try and learn from the Australian banks," Fraser said.

"I think it's a fascinating area, having got people that access. The industry needs to make sure they don't turn a beautiful runway in to something where a plane can't take off because the weather system is too complex."

He added the UK is also seeing a need to advance to the Australian mentality where providers think like the consumer. The UK's financial guidance website Pension Wise is a good step.

"It's very early days but it would be interesting how Australia would view Pension Wise," Fraser said.

Fraser will be presenting at CMSF on retirement governance. He will present during one of the ME Learning Lab sessions.

"It's interesting for me that the Australian market, along with some of the Scandinavian funds have led the way with ESG. But do we need something that sits on top of ESG that is a code that will help trustees frame how they look at being responsible investors, and work with underlying managers?" Fraser said.

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