Low Awareness of Government's Stakeholder Pension Initiative

Poll Indicates Employers, Banks and Building Societies Will Be Preferred Providers of New Pension Services

A new poll released today by Accenture reveals public awareness of the government's nationwide stakeholder pension initiative to be extremely low - just weeks before its launch.

Accenture (formerly known as Andersen Consulting) asked MORI to conduct the survey and it shows that not only is recognition of the stakeholder pension initiative weak, but that public familiarity with the initiative has actually declined over the past two years.

Results of the survey indicate that only 30 percent of the population has heard about stakeholder pensions, despite the current advertising campaign. This represents a three percent decline in awareness, compared with the results of a similar survey conducted in June 1999. Stakeholder pensions are simple, low-cost pensions designed to encourage people to save more for retirement and are being launched in April.

Once the concept was explained to survey respondents, some 70 percent of the people MORI questioned emerged as potential buyers. The survey showed that employers, banks, building societies and insurers were all rated highly as providers of stakeholder pensions. But groups once expected to be key providers in the stakeholder era, like affinity groups, supermarkets and trade unions, have limited popularity.

Stakeholder pensions represent an opportunity for pension providers, who are expecting to attract new customers as a result of the initiative. However, providers are also having to look for ways to substantially reduce their cost base, in order to maintain profitability. This is because a key aspect of stakeholder pensions is that they force firms to cut their total annual charges to a maximum of one percent of funds invested.

"We believe that stakeholder pensions can be 'win-win' for both providers and the public," said Dee Lehane, a partner in Accenture's Financial Services practice based in London. "The key challenge for stakeholder providers is to work out how to change their business model so that they can both attract new customers and reduce their distribution and servicing costs sufficiently to remain profitable."

Although stakeholder pensions were designed to make pensions more attractive to groups that had not previously invested in pensions, the MORI survey suggests that the main beneficiaries of the stakeholder pensions initiative will be the wealthy and those already saving.

Technical details

Source: MORI Omnibus survey of 1000 adults across Britain. Questions asked of 681 adults who say they were not retired. Fieldwork conducted 25th Jan to 30th Jan 2001. Previous survey published June 1999.

About Accenture

Accenture, formerly known as Andersen Consulting, is a $10 billion global management and technology consulting organisation. The firm is reinventing itself to become the market maker, architect and builder of the new economy, bringing innovations to improve the way the world works and lives.

More than 70,000 people in 46 countries deliver a wide range of specialised capabilities and solutions to clients across all industries. Under its strategy, the firm is building a network of businesses to meet the full range of client needs -- consulting, technology, outsourcing, alliances and venture capital. Accenture's home page address is http://www.accenture.com

Renamed. Redefined. Reborn.

On January 1, 2001 Andersen Consulting's name was changed to Accenture. Since August 7, 2000 Accenture has not been associated with Andersen Worldwide or Arthur Andersen.

SUMMARY OF RESPONSES

Q1 Have you heard of 'stakeholder' pensions?

Q2 Are they an attractive idea?

Q3 If you were to invest in one which type of scheme would you prefer?

Q4 How would rate the following as providers (10 very positive, 1 very negative)