How to win friends and influence people: Andy Haldane isn't doing a great job when it comes to pensions

Oliver Gill
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The British pensions system is a mystery to the Bank of England's chief economist (Source: Getty)

Experts labelled comments by Andy Haldane as "irresponsible" after the Bank of England chief economist said he would invest in property rather than putting money into a pension scheme.

"It is extraordinary that someone in his position should make such irresponsible comments. If everyone acted on his views it would have seriously damaging consequences both for individuals and for the economy," said Tom McPhail of Hargreaves Lansdown.

Read more: Smallest businesses face £22m of fines over auto-enrolment confusion

“It ought to be pension but it’s almost certainly property,” Haldane said to The Sunday Times when asked about what he thought was the best way to save for retirement.

Haldane made the comments over the weekend and was immediately lambasted by former pensions minister Ros Altmann who summed up his comments as "divorced from reality" and "irresponsible".

Initiatives are in place to encourage people to save now for their retirement in order to mitigate the effects of an ageing population and the financial burden this will place on the state.

One such initiative is the government's auto-enrolment policy for compulsory workplace pensions. But these can still be opted out of by employees. The concern from experts is that comments like this will deter people from saving for retirement through a pension.

"It’s probably quite easy for someone with a gold-plated final salary pension to dismiss the importance of saving in a pension for retirement.

"Andy Haldane’s pension benefits are estimated to be worth in excess of £3m, which is not bad going for someone who professes not to even know how pensions work. Perhaps we should take away his final salary pension and just give him another house instead," said McPhail.

Read more: Altmann calls for an end to "bells and whistles"

It isn't the first time in recent months that Haldane – who is also the executive director of monetary analysis, research and statistics at the Bank of England – has the role of has upset the pensions sector with his comments.

In May he admitted "not being able to make the remotest sense of pensions" while further angering the sector by saying that he didn't think that any financial advisers "had a clue" either.

"We did write to him after [his comments] last time and offered to explain to him how pensions work.

"At the very least his employers should now make this compulsory before he makes any further public comments," said McPhail.

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