INDUSTRY INSIGHT
What we like about the Social Market Foundation’s New Report
May 2021
Hi Readers. I hope you’re all as well as can be, keeping safe and perhaps even starting to venture out and re-discover other human beings.
It’s been a significant week for me. My first Covid vaccination has boosted hope of escaping the perma-March 2020 world of home-everything; my first haircut of 2021 means that my colleagues will perhaps stop suggesting that I adopt a man bun or pigtails and in a few days’ time my daughter will turn 1 year old which I assume means that she’ll magically ‘level up’ and be able to do all those things that are “not suitable for under 12 months”.
For the wider employee share plans world the most significant development was the launch of the Social Market Foundation’s report (A stake in success: Employee share ownership and the post-COVID economy - Social Market Foundation (smf.co.uk)) commissioned by our friends at ProShare (www.proshare.org).
I must congratulate Scott Corfe for an excellent report. For me there are three aspects that stand out:
1. Scope: this report is BROAD. Because of the effort required to obtain even modest tweaks to legislation we as an industry tend to be quite focused on specific items of change such as the 6 – 12 month payment holiday change in Sharesave or the proposed SIP tax relief change from 5 years to 3 years. As you can see from the extensive End Notes the authors of this report have dug deep and produced recommendations covering tax treatment, accounting treatment, employee shareholder voice, company take up, accessibility for low earners and much more.
2. Topicality: the Covid crisis has brought into focus the extent of financial vulnerability in Britain and the need to “build back better”. This report highlights just how much potential employee share plans have to play in tackling those issues, providing new analysis “Employee shareholders in the lowest income quartile (“the poorest 25%”) have median net financial wealth £10,900 greater than those that are not employee shareholders.” and re-emphasising old “on average, the effect of tax-advantaged employee share plans is significant and increases company productivity by 2.5% in the long-run, rising to 4.1% in the case of Save as You Earn plans.”
3. Profile: the actual share plan provider industry is a specialist niche and it can be hard to get mainstream visibility. This report has been covered in mainstream publications like The Guardian and The Times and the panel for ProShare’s launch event shows that this isn’t just reaching share plan nerds like me.
I’d like to drill down further into specific findings but for now I’d really encourage you to go read the report for yourself, go on, it’s easy, just click right here: A-stake-in-success-May-21.pdf (smf.co.uk)
Please note that whilst Yorkshire Building Society employees were interviewed as part of the research behind this report and research previously conducted on behalf of Yorkshire Building Society is cited in the report, Yorkshire Building Society had no part in the production or editing of the report itself. Yorkshire Building Society is not responsible for the content of the report and content of the report does not necessarily represent the views of Yorkshire Building Society. It is being shared in the interests of stimulating industry awareness and discussion.
COVID 19 Day in the Life of a Share Plan Consultant
August 2020
How are your teams coping with lockdown? Do we really know what their lives are like in this enforced stay at home office? We thought you may be interested in a view of this Brave New World we all live in from our Share Plan Consultant Hayley Forrest Hayley Forrest.
Shock to the system! - Hayley
Having the choice to work from home is always a nicety, everyone is out so you get some peace and quiet plus you always seem to have a productive day with the added benefit of being able to pop a wash on and whizz the hoover round when you need a break from your laptop!
I think when the initial “lockdown” was announced the feeling of doing that every day sounded quite appealing, until I took a sense check and realised, I would have my husband also working from home plus my one year old!!! The thought of doing this full time soon didn’t sound as appealing.
We quickly changed the conservatory into a make shift office, and instead of facing my work colleagues on a daily basis I was either facing my husband Danny or son Frankie who was now able to climb up on the chair and pretend he was on the phone whilst whacking the keys on the computer!
Being on a conference call is also a challenge in itself, trying to concentrate on what people are saying whilst blocking out the constant “mummy, mummy, mummy”, along with our cat deciding one day that he would bring in a live bird… (I think he thought I needed a present to cheer me up). The poor bird was then flapping around my head needing help to get away from the killer cat, thankfully I was only on a call with my team so I could get away with a few explicit words!
We soon learnt that the only way to manage both our workloads was to take shifts, one working in the morning and one in the afternoon so that the other person could look after Frankie, who is now at an age where he needs that constant attention/playtime. Unfortunately for Danny I have taken over quite a bit and we seem to constantly bicker over whose work is more important (obviously its mine!) Working on an evening helps me catch up although the last 10 weeks I think I have felt more exhausted than ever, if I am not working I am looking after Frankie and if I am not doing that I am cooking, cleaning all the usual chores that still need doing. I hope it’s not just my house that never seems to look tidy anymore!
All this said I know that there are many more people out there in the same situation, some of which are my clients, so together we can all appreciate that this is just short term pain but totally worth it as we are able to keep safe and well.
Hopefully it won’t be too long until normal business can resume and we can go back to some normality, never again will I moan about having to get up and GO to work!
Sharing trends and offering wellbeing support
April 2020
It’s clear to see the impact coronavirus is having on everyday life and finances across the UK, so we want to reassure you that we’re here to help, not only our clients but also the relationship we have built over the years within the share plan/workplace savings arena. We wanted to share an update on what has been a very unusual and turbulent few weeks including some of the trends we are seeing and initiatives we have been working on.
Share Plans trends (as at 16th April)
Wellbeing and financial resilience
For those of you who have attended our regional events and Financial Wellbeing Masterclasses you will know we are passionate about living our purpose which is to provide real help with real life. Through all the insight and research we collate with Salary Finance, the Universities of Leeds and Durham we know that employers play a huge part in the financial wellbeing of their employees.
With this in mind, we are making a wellbeing portal available for you to share with your employees and your clients. It will give your people access to helpful information and guidance on a range of financial, mental and physical wellbeing topics, as well as the latest investment market update.
The information on mental and physical wellbeing is provided by Rightsteps, a leading health and employee wellbeing specialist. The financial content is provided by Secondsight, multi award winning employee benefits advisers.
To make this easily accessible for all, the wellbeing portal will be available until 30/08/2020 at no cost to you.
For more information please contact Darren Smith
Financial behaviour and decision making
A survey of Sharesave participants in conjunction with Leeds and Durham University Business Schools
14 June 2019
YBS Share Plans recently completed a major research study looking into Sharesave participation in conjunction with Professor Andrew Pendleton (Durham University Business School) and Professor Andrew Robinson (Leeds University Business School).
The research was designed to find out more about the financial behaviour and decision making of Sharesave participants, exploring influences on employee contributions, any links to broader patterns of savings and debt and impacts on financial wellbeing.
Our report is a summary of the key findings using the responses of approximately 2,700 employees from 177 different companies (across all sectors). If you'd like to know more, get in touch at business_development@ybs.co.uk.
Financial behaviour and decision making
A survey of Sharesave participants in conjunction with Leeds and Durham University Business Schools
14 June 2019
YBS Share Plans recently completed a major research study looking into Sharesave participation in conjunction with Professor Andrew Pendleton (Durham University Business School) and Professor Andrew Robinson (Leeds University Business School).
The research was designed to find out more about the financial behaviour and decision making of Sharesave participants, exploring influences on employee contributions, any links to broader patterns of savings and debt and impacts on financial wellbeing.
Our report is a summary of the key findings using the responses of approximately 2,700 employees from 177 different companies (across all sectors). If you'd like to know more, get in touch at business_development@ybs.co.uk.
Yorkshire Building Society is working with Salary Finance to provide employee benefits
18 January 2018
Employers can now offer an initiative to try and help improve the financial wellbeing of their employees thanks to a new relationship between Salary Finance and Yorkshire Building Society.
Providing a new way for employees to build up a rainy day fund or save for the future, the product aims to help the 16.8m working-age Brits identified by the Money Advice Service who have less than £100 in savings[1].
The Salary Finance/Yorkshire Building Society initiative aims to help make it easier for people to start a savings habit. Employees choose a regular amount of money to save and deposits are taken directly from their salary. This allows savings to be kept separate from day-to-day spending. However, money can still be accessed and withdrawn at any time, without loss of interest, if it’s needed.
The Salary Finance Internet Saver account:
- Currently pays 0.75% gross per annum AER variable
- Interest paid monthly or annually
- Can be opened with a minimum of £1
- Has a maximum balance of £1 million
- Allows withdrawals between £10 and £250 per day, or up to five withdrawals per day within these limits from any LINK cash machine
- Allows as many withdrawals online as you like
Baroness Ros Altmann, Consumer Champion and former Pensions Minister, said: “The UK is facing a savings crisis. In 2017 the ONS announced the UK savings ratio was at its lowest since 1963. The erosion of a savings habit is creating financial fragility across the UK workforce. This increases the risks of unexpected costs putting people in financial difficulty.
“Salary Finance and Yorkshire Building Society are launching an initiative that can enable employers to play a role in addressing these issues. In doing so employers can improve the financial confidence and resilience of workers across the UK.”
Mike Regnier, Yorkshire Building Society Chief Executive, said: “Starting, and keeping up, a regular savings habit is a big driver of financial wellbeing, especially for those that don’t have any form of meaningful savings already.
“Saving a small amount directly out of salary on a regular basis is a simple way to achieve this, as money is moved into savings before it reaches a bank account and could get caught up in everyday spending.
“As a mutual organisation, we’re really proud to be working with Salary Finance to offer this way to save and to help employers provide support for their employees’ financial wellbeing. And because we’re a mutual, these employees will also become members of our society.”
Asesh Sarkar, Chief Executive of Salary Finance, said: “At Salary Finance, we understand the crucial role finances play in our health and happiness. Since launching we have proved that finance can be delivered in a socially progressive way.
“Our relationship with Yorkshire Building Society expands our ability to help UK employees work towards a more financially secure future. This new savings product creates a great opportunity for employers to have a significant positive impact in the lives of their employees by increasing their financial confidence. We are excited to make this product available to employees that already have access to Salary Finance.”
Allied Healthcare, one of the UK’s biggest home care providers, will be the first company to offer the product.
James Drewry, Reward Manager at Allied Healthcare, said: “As part of our wider rewards strategy, we feel that it is incredibly important to support our colleagues with their financial wellbeing. Having already implemented a highly successful loans product with Salary Finance, we are hugely excited about this new addition to their offering.
“Colleagues have made it clear through survey feedback and written requests that they wanted more support with saving for long or short term financial goals. Combining an effortless depositing process with the flexibility to access funds at any time gives our employees the option to save money without removing their control of it. It’s the perfect solution.”
Saga plc, another Salary Finance client, will also be launching the savings product. Karen Caddick, Group HR Director at Saga, said: “We care passionately about the wellbeing of our colleagues and recognise the impact that financial stress can have at home and work. We have been very pleased with the way Salary Finance has helped our colleagues to get out of debt faster and at lower cost, and are now delighted to be launching their savings product. We will also be introducing a matched savings scheme, where we will add to employee savings, to encourage a savings habit and increase financial resilience.”
Yorkshire Building Society has a pedigree as a workplace savings provider – its YBS Share Plans business was established in 1980 and administers save as you earn and share incentive schemes for more than 240 companies.
[1] Statistics taken from Millions at risk with savings of £100 or less, Money Advice Service, Andy Webb, https://www.moneyadviceservice.org.uk/blog/millions-at-risk-with-savings-of-100-or-less as at 30 January 2018.
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