Unum welcomes House of Lord’s call for more financial capability training at work
5th April 2017
- Unum backs report from the House of Lords Committee on Financial Exclusion calling for the new public financial guidance body to focus upon financial capability
- The report states that employers benefit from investing in the financial capability of their staff. Unum supports the report’s recommendation that the government make financial training at work more widely available
- Unum supports the report’s conclusion that the government must take more leadership and a more coordinated approach to build financial capability in the UK
Employee benefits provider, Unum, has backed a report from the House of Lords Select Committee on Financial Exclusion1. The report makes a number of recommendations to improve financial inclusion in the UK.
It comes as the government is preparing to overhaul the public bodies that advise people on how to manage their money. The government is expected to announce plans shortly to replace the taxpayer funded Money Advice Service, Pensions Advisory Service and Pension Wise with a single body. A consultation on the plans closed in December last year2.
The Money Advice Service launched a ten year financial capability strategy for the UK in 20153. It found 27 million working people did not have a sufficient savings buffer to allow them to cope with a significant income shock.
Quoting evidence from Unum3, the Lords report expresses concerns that the “slimmed down nature of a new body might lead to a focus on resolving debt issues rather than preventing them through improvements in financial capability”. The Select Committee recommends that “the new guidance body that replaces the Money Advice Service should continue to focus upon, and fund, evaluation of financial capability programmes”.
Citing evidence from multiple sources showing the negative impact money worries have on employees’ productivity and health, the report concludes that “supporting the ongoing financial capability of employees will, in the long-term, be of benefit to employers”. The Select Committee calls on the government and employers to work together to make financial training more widely available to working people.
Such training, the report recommends, must be part of a commitment from the government to “give greater leadership and central coordination to initiatives that seek to address financial exclusion”.
These recommendations are all in line with the evidence Unum gave to the inquiry. Reflecting on the Select Committee’s recommendations, John Letizia, Head of Public Affairs and Corporate Social Responsibility at Unum said:
“I look forward to the government’s response to this sensible and urgent report from the House of Lords. Despite years of hotchpotch initiatives from different government departments, levels of financial capability and exclusion are still worryingly low.
“If the government is serious about tackling this problem, the Select Committee is absolutely right that it must take the lead and implement a strategic, coordinated approach. As part of that, it must ensure that whatever body replaces the Money Advice Service concentrates on building financial capability, especially among working people.
“Those of us in insurance and employee benefits also have much to do. We can ensure more employers understand how to look after their staff and help them access the right financial products. At Unum, we are making it easier for customers to understand and buy our products.
We have also teamed up with SmarterInvestment to make it easier for employees to save and invest money and plan their financial future at work.
“But we will go further to lead the way and I look forward to announcing a new project on financial capability soon”.
- House of Lords Select Committee on Financial Exclusion, Tackling financial exclusion: A country that works foreveryone? Published on 25 March 2017. Available from: https://www.publications.parliament.uk/pa/ld201617/ldselect/ldfinexcl/132/132.pdf
- Available from: https://www.gov.uk/government/consultations/public-financial-guidance-review-consultation-on-a-single-body
- Available from: http://data.parliament.uk/writtenevidence/committeeevidence.svc/evidencedocument/financial-exclusion-committee/financial-exclusion/written/38031.html