Over the past twenty years, we have seen a secular shift away from defined-benefit towards defined-contribution pension schemes. That places the investment risk of pensions squarely on the shoulders of the individual, rather than companies. Whatever the merits of these shifts, they underscore the importance of simple, easilyunderstood financial products for the public if they are to manage these new risks. They also underscore the importance of adequate information on these products. In 2010, the Money Advice Service was set up to help provide this information. Following a review last year, this service is in the process of being replaced. A new body is also being established to provide a single point of contact for advice on pensions, replacing the existing Pensions Advisory Service and Pensions Wise. Just yesterday, the Competition and Markets Authority (CMA) proposed that a new price comparison website be set up, funded by the banks, to better enable bank customers to pick the best deal for them. 43 They also suggested greater transparency around bank charges. If implemented, these measures would be good news for retail customers. Alongside the move to a Faster Payments service in 2008 44, these are among the two biggest improvements to bank customer service in the past decade. But here’s the rub. Both of these improvements were the result of regulatory intervention by the competition authorities, not market-led initiatives by industry. They resulted from regulatory push, not customer pull.
As one example of that, the Open University has recently made available on-line a set of three modules for helping adults better understand  38  G30 Working Group (2015). 39  New City Agenda (2014). 40  See BIS (2012). BIS central bankers’ speeches  9  financial matters and, ultimately, make better financial choices. 41 Charities like Citizens Advice are also doing fantastic work in this area. Of course, part of the reason so many members of the public find finance difficult is because it is difficult – and, sometimes at least, it is made deliberately so. There is plenty of evidence, including from the financial crisis, of financial products being made more complex than was necessary and consumers being charged a premium for buying them. 42 This damaging cycle persists because of the difficulties consumers understandably face when trying to compare these products. To give a personal example, I consider myself moderately financially literate. Yet I confess to not being able to make the remotest sense of pensions. Conversations with countless experts and independent financial advisors have confirmed for me only one thing – that they have no clue either. That is a desperately poor basis for sound financial planning. This problem is one which, if anything, is becoming more acute over time. More of the risk associated with financial decisions is these days being shouldered, not by the state or companies, but by individuals. Take pensions.