Ms Vahey said there was a need for an independent commission, as called for by the Association of British Insurers, but doubted it would happen because the space was “so convoluted” and the government was trying to keep control of the money spent.
Ms McAlpine agreed cost was likely a major factor.
She said it appeared the government and regulator were aware of the challenges but unable to find a solution due to the cost implications for the Exchequer of any promise of a tax incentive.
Aegon’s pensions director, Steven Cameron, meanwhile said the regulator had set itself the wrong priorities in focusing on products such as stakeholder pensions (SHP) in its review.
He said: “The government has said before they were looking to expand the scope of auto-enrolment to the self employed. [This means there will be an] even smaller market for SHPs. I’m not sure reviewing the value for money of SHPs would be at the top of my priorities right now.”
The FCA said it remained in regular contact with the DWP and government to understand how separate work streams informed each other.
The regulator also said it had considered the Taylor review and the auto-enrolment review when developing its latest discussion paper.
The DWP has been approached for comment.
carmen.reichman@ft.com
