A Campaign for Citizen Outcomes, Saver Sovereignty and Human Agency
Britain is repeatedly told that what is good for the financial sector is good for the country.
More capital must be “unlocked.”
More pension money must be directed towards productive investment.
Regulation must become less burdensome.
Consumers must become more comfortable with risk.
The financial sector must become more internationally competitive.
Each proposition may contain some truth. Investment matters. Enterprise requires capital. Poor regulation can entrench incumbents and prevent useful innovation.
But a crucial question is being missed:
What happens to the person?
Does financial-sector growth make citizens more secure, capable and free?
Does increased investment produce better lives, or merely larger financial markets?
Does deregulation remove unnecessary bureaucracy, or remove the protections people rely upon when institutional power is abused?
Are pension assets national investment capital available for policymakers to mobilise—or the deferred wages of individual citizens?
These are not technical questions at the margins of economic policy.
They determine whom the financial system exists to serve.
The category error at the centre of financial policy
Governments increasingly speak as though the interests of the financial sector, the national economy and the citizen are naturally aligned.
They are not.
A larger financial sector can generate employment, tax receipts and investment while simultaneously extracting more from households through charges, interest, commissions, complexity and dependency.
Investment flows can rise without household financial security improving.
Gross domestic product can grow while people lose control over their time, money and future.
Pension funds can allocate more capital to private markets while individual savers encounter higher costs, reduced liquidity, greater complexity or risks they never knowingly chose.
The Financial Conduct Authority has, since 2023, operated under a secondary objective to facilitate the international competitiveness and growth of the UK economy. The FCA says this objective applies while it advances its primary objectives, including consumer protection and market integrity.
That formal ordering matters. Consumer protection remains a primary objective.
But political language can reverse the hierarchy.
Protection becomes a burden.
Caution becomes excessive risk aversion.
Rules become friction.
Redress becomes a cost to the industry.
Consumer reluctance becomes a cultural problem requiring people to be persuaded to accept more risk.
The financial system is then treated as the protagonist of the story. The citizen becomes an input: a consumer, investor, borrower, policyholder, pension saver or source of investable assets.
We need to reverse the lens.
The Mansion House worldview
The Mansion House programme illustrates the prevailing policy direction.
The Government has promoted reforms intended to direct substantially more pension capital into private assets and UK investment. The Mansion House Accord involved major defined contribution pension providers committing to allocate at least 10% of their main default funds to private markets by 2030, with at least 5% allocated to UK private markets. The participating schemes collectively represented around 90% of active defined contribution savers.
Government announcements describe these measures in terms such as “unlocking” investment for businesses, infrastructure and economic growth.
But pension money is not trapped government capital waiting to be released.
It belongs beneficially to people.
It represents income they earned but deferred consuming, often over an entire working life, so they could support themselves when no longer working.
Before asking what pension assets can do for the country, we should ask what the country owes to the people whose money it is.
Investment in productive British enterprises may benefit savers and society. The issue is not whether pension funds should invest in Britain.
The issue is the order of obligation.
Savers’ money may support national growth. National-growth policy must not subordinate savers to it.
Five beliefs that need challenging
The Academy of Life Planning believes the Transparency Task Force could help expose and challenge five assumptions embedded in contemporary financial policy.
1. Financial-sector growth is national growth
Financial services are economically important. But the size, revenue or profitability of the financial sector is not itself a measure of national well-being.
Some financial activity creates value by allocating capital, sharing risk, facilitating exchange and helping people plan.
Other activity extracts value through complexity, opacity, excessive intermediation, dependency and charges based on assets rather than work performed.
Both types can increase measured economic activity.
A country should therefore distinguish between:
- growth in useful financial capability;
- growth in financial intermediation;
- growth in extraction from household wealth.
More finance is not necessarily better finance.
The relevant question is not merely how much the sector contributes to GDP, but how much capability it contributes to society.
2. More investment automatically means better citizen outcomes
Investment is an input, not an outcome.
Billions can flow into infrastructure, private equity, technology or housing without ordinary citizens becoming more secure, prosperous or autonomous.
The public should be shown the complete transmission mechanism:
Investment into what, through whom, at what cost, carrying which risks, producing which benefits, for whom, and over what period?
Without that chain of accountability, “investment” becomes a morally reassuring word that conceals the distribution of risk and reward.
Capital deployment should be judged not only by the amount invested or the return generated, but by whether it expands human capability.
Does it create decent work?
Does it reduce essential costs?
Does it strengthen communities?
Does it improve resilience?
Do the citizens supplying the capital receive an appropriate share of the benefit?
Capital should serve life. Life should not be reorganised merely to serve capital.
3. Deregulation removes friction
Some regulation is duplicative, ineffective or designed around institutions rather than people. It should be improved.
But “friction” is not a neutral term.
A brake is friction.
So is a guardrail.
So is the requirement to explain a risk, record consent, disclose a charge, investigate a complaint or compensate someone who has been harmed.
For a firm, these may appear to be operational costs.
For the citizen, they may be the only obstacle standing between institutional power and irreversible loss.
The FCA has invited the industry to identify rules that could be removed or simplified where it believes they overlap with the Consumer Duty.
That may identify genuine duplication. But reform must distinguish among three very different things:
- administrative friction, which creates effort without meaningful protection;
- competitive friction, which may preserve incumbent business models;
- protective friction, which slows institutions down long enough for people to understand, reconsider or obtain redress.
The first should be reduced.
The second should be challenged.
The third should not be casually removed.
4. Consumer protection constrains competitiveness
Good consumer protection does not obstruct a healthy market. It creates the trust on which a healthy market depends.
The FCA itself has recognised that market integrity is the foundation of sustainable competitiveness and that there can be money to be made by lowering standards or looking the other way.
A financial centre should not compete by becoming the jurisdiction in which firms can transfer the greatest amount of risk to the least informed people.
It should compete by becoming the jurisdiction in which people can participate with confidence because:
- costs are visible;
- conflicts are controlled;
- products are understandable;
- promises are enforceable;
- wrongdoing produces timely redress;
- institutions cannot profit from manufactured confusion.
Protection and competitiveness are not natural enemies.
Poorly designed protection can obstruct beneficial activity. But trustworthy markets are themselves a competitive asset.
The appropriate question is:
Are we making Britain easier for good firms to operate in—or easier for powerful firms to extract from people?
5. Pension assets are national capital before they are deferred wages
The phrase “unlocking pension capital” quietly changes the perceived ownership of the money.
It makes pension assets sound like a dormant national resource under the stewardship of government and industry.
They are not.
They are citizens’ deferred wages.
That does not mean every individual must personally select every underlying investment. Collective investment, professional governance and diversified default funds are necessary and beneficial.
But stewardship does not extinguish ownership.
Every proposal to redirect pension assets should therefore begin with fiduciary purpose:
How does this improve the saver’s probability of achieving an adequate, secure and sustainable retirement after costs, risks and uncertainty?
Only after that test is satisfied should policymakers describe the wider economic benefits.
The sequence matters because language determines accountability.
Call the assets “national investment capital” and the saver becomes a funding source.
Call them “people’s deferred wages” and government and industry become custodians.
What should the Transparency Task Force campaign for?
The Transparency Task Force describes itself as a collaborative campaigning community dedicated to increasing transparency in financial services. It argues that transparency is a prerequisite for fairer, safer and more efficient markets.
Transparency should now extend beyond product disclosures and institutional conduct.
We need transparency about the assumptions governing financial policy itself.
The Academy proposes a campaign for a Citizen Outcomes Test.
Before any major financial-services, pensions or regulatory reform is adopted, government and regulators should publish a standardised assessment answering six questions.
1. The Human Agency Test
Will this proposal increase or reduce people’s capacity to:
- understand what is happening;
- make a meaningful choice;
- act without unnecessary dependency;
- leave an unsuitable arrangement;
- challenge an institution;
- obtain effective redress?
Financial capability must not be treated merely as knowledge.
A person may understand a system but remain unable to act because the system withholds meaningful alternatives.
Agency requires understanding, choice and practical power.
2. The Citizen Distribution Test
Who receives the gains?
Who carries the costs and risks?
The assessment should distinguish between effects on:
- citizens and households;
- pension savers;
- taxpayers;
- employees;
- financial institutions;
- intermediaries;
- shareholders;
- government finances.
An aggregate economic benefit should never be presented without showing its distribution.
A reform that produces £1 billion of economic activity while transferring £1.2 billion from households to intermediaries is not an obvious public success.
3. The Saver Primacy Test
Any policy affecting pension assets should demonstrate that:
- saver interests remain legally and practically primary;
- projected benefits are shown after all costs;
- liquidity and valuation risks are disclosed;
- comparisons use realistic and transparent assumptions;
- trustees and providers retain the ability to reject politically preferred investments;
- government objectives do not override fiduciary judgement.
Where the evidence is uncertain, that uncertainty should be visible.
Pension policy should not treat optimistic projections as guaranteed improvements in retirement outcomes.
4. The Protective Friction Register
Whenever a regulation is described as a burden, barrier or friction, the Government or regulator should identify:
- the original harm the rule was intended to prevent;
- whether that harm still exists;
- who benefits from removing the rule;
- who becomes more exposed;
- what alternative protection will replace it;
- how the consequences will be measured.
No protection should disappear merely because the regulated industry experiences it as inconvenient.
The burden of proof should sit with those seeking to remove the guardrail.
5. The Financial Extraction Account
National reporting should distinguish between financial services that increase citizen capability and those that extract from accumulated household wealth.
The public should be able to see, in aggregate:
- fees deducted from pensions and investments;
- interest and default charges paid by households;
- insurance claims rejected or reduced;
- compensation delayed or unpaid;
- losses associated with fraud and unsuitable products;
- the economic cost of unresolved financial harm;
- the proportion of household wealth transferred annually to financial intermediaries.
We meticulously measure the financial sector’s contribution to the economy.
We should also measure what the financial system takes out of people.
6. The Citizen Counterfactual
Every major reform should ask:
What could citizens have done with the money, time, choice or security transferred to the financial system?
A percentage charge can appear small when presented annually.
Over decades, it may absorb years of retirement income.
A delayed complaint can appear administratively manageable to an institution.
For the person, it may mean lost housing, damaged health, family breakdown or years of life consumed by a dispute.
Policy analysis should include the opportunity cost imposed on human lives, not merely the compliance cost imposed on firms.
From consumer voice to citizen power
Public consultation is not enough.
The financial sector participates in policymaking through permanent teams of lawyers, economists, lobbyists, trade associations and technical specialists.
Citizens are invited to respond to documents hundreds of pages long, using terminology created by the institutions whose conduct is under review.
That is not equal participation.
It is formal access without equivalent capacity.
The Citizen Outcomes Test should therefore be overseen by a standing body with substantial representation from:
- ordinary savers;
- consumer advocates;
- victims of financial harm;
- independent academics;
- civil-society organisations;
- practitioners without product or asset-based conflicts.
Its role would not be to prevent reform or investment.
It would ensure that institutional enthusiasm is tested against lived consequences.
Why should every citizen support this?
Because almost every citizen is involuntarily exposed to the financial system.
You may decide not to employ a financial adviser.
You cannot realistically decide not to participate in money.
Your wages pass through banks.
Your housing depends upon property and credit markets.
Your pension is invested through institutions you did not design.
Your insurance, utilities, taxes, savings and digital payments all rely upon financial infrastructure.
Even people with no investments are affected by the allocation of capital, the price of credit and the consequences of financial failure.
And when the system goes wrong, the losses rarely remain private.
Failed institutions are rescued.
Misconduct produces compensation schemes funded through charges that may be passed back to customers.
Poor pension outcomes create pressure on families and public finances.
Fraud damages health, relationships, trust and economic participation.
A financial system that diminishes human agency eventually creates costs for everyone.
This is why consumer protection is not a minority interest.
It is civic infrastructure.
The campaign in one sentence
The Transparency Task Force should ask government, regulators and the financial industry to adopt a simple principle:
No financial reform should be called successful until its effect on citizen agency, security and lived outcomes has been independently measured and publicly disclosed.
That is not anti-growth.
It is a demand to define growth properly.
We want businesses to flourish.
We want useful innovation.
We want capital to reach productive enterprises.
We want pensions to provide strong and sustainable returns.
But these are instruments, not ultimate purposes.
The purpose of an economy is not to make its institutions larger.
It is to help people build lives they have reason to value.
Finance is the means. Agency is the outcome.
The deepest problem in financial policy is not necessarily corruption, conspiracy or individual bad faith.
It is a hierarchy of attention.
Institutions are visible, organised and permanently represented.
Citizens are fragmented, busy and usually heard only after harm has occurred.
What gets measured, consulted and celebrated therefore reflects the priorities of the organised system.
Financial-sector growth is announced.
Investment flows are counted.
Regulatory burdens are catalogued.
Institutional competitiveness is measured.
But the citizen’s capacity to understand, choose and act remains largely invisible.
The Academy of Life Planning exists to change that.
Our mission is not simply to protect people from individual bad decisions.
It is to help build a society in which institutions are judged by whether they increase human capability or manufacture dependency.
The question for every financial reform should no longer be merely:
How much capital will this unlock?
It should be:
How much human agency will this release?
Academy of Life Planning 