Secondary pensions provider pulls out

Deputy Peter Roffey, the president of Employment & Social Security, made the announcement to the Assembly.

He said he was disappointed, but he tried to look on the bright side.

‘What this does mean is that there is now an opportunity for a locally-based pension provider to play a crucial role in the introduction of secondary pensions in the Bailiwick. The project board has reviewed its plans for the implementation of Your Island Pension and has held discussions with local industry participants, from which we have determined that there is significant interest in providing the scheme.

'We’ve been really encouraged by those discussions and expect to launch an invitation to tender to select a new provider very soon, within the next couple of weeks.

'Although this could be seen as a hiccup, I hope members will welcome this work being kept local and therefore actively supporting Guernsey’s pension industry.'

Smart Pension Ltd told ESS that it was withdrawing because of ‘changes to the commercial landscape’.

ESS wants to deliver a revolution in the local pensions so that older people can have another route to income on top of the old age pension after retirement and reducing dependency on the welfare state.

In 2019 a survey revealed that more than 25,000 workers in Guernsey did not have an occupational or personal pension scheme, and were instead relying on the States pension for their old age.

This year the States pension is pegged at £228.37 for someone who has paid all their contributions, or just under £12,000 per year.

That amount is generally regarded as insufficient to lead an enjoyable and fulfilling retired life, especially for people in rented accommodation, and ESS often finds itself in a situation where it has to support people who have not set aside enough for later life.

It is anticipated that the procurement exercise for a new preferred provider will be completed in the first quarter of 2022. Then ESS will seek approval from the States to proceed with the new provider.

Deputy Roffey said he remained optimistic that the targeted implementation date of January 2023 was achievable.

‘However, we will keep this under review as things progress to ensure employers have sufficient time to put in place the necessary arrangements to comply.’