'The pensions industry is in danger of breaching its capacity to cope'

It has been an unprecedented three years in the pensions world – with a roller-coaster of changes – but ultimately I believe that a fairer, more transparent world is being created for our customers.

Since I joined Scottish Widows in late 2011, we have dealt with the implementation of the Retail Distribution Review, the roll-out of automatic enrolment, government caps on pension charges and the changes announced to annuities in the 2014 Budget. All of which give savers greater transparency, flexibility and choice.

In the absence of any breathing space, we have concerns that the industry is in danger of reaching – and in fact breaching – its capacity to cope. Many of our own processes have struggled in the wake of the ongoing changes and as a result our service levels are in some areas falling short of the high standards our customers expect of us.

I fully appreciate the impact that our service issues have had, and are having, on our customers and we are working hard and investing significant resources to ensure that we fix this as quickly as possible. Scottish Widows is investing tens of millions of pounds over the coming months and years to make us better placed to deal with this new world.

This involves new customer service staff, upgrading IT systems and investing in training programmes. We are working with financial advisers, employers and the payroll industry, where we are also seeing capacity challenges.

The most recent Budget changes will enable consumers not only to have greater flexibility with their savings but also to have an ongoing dialogue with their adviser. In the future, retirement won’t be a one-off conversation.

So to deliver real benefit to consumers, these changes must be allowed to bed in before any further change is considered, so that we can ensure we have robust approaches in place to help our customers with their financial decisions.

Toby Strauss is chief executive of Scottish Widows

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