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Getting to grips with the new guidance qualification

The Certificate in Pension Scheme Member Guidance was designed for administrators but could also be useful for paraplanners and advisers.

Getting people to understand their retirement options and the implications of the decisions they make has taken on a new significance since the guidance guarantee was announced last year.

But even before the pension reforms were unveiled, JLT Employee Benefits and the Pensions Management Institute were developing a qualification focused on the provision of guidance, with particular emphasis on communicating the various options available to pension scheme members in a jargon-free way.

This qualification, the Certificate in Pension Scheme Member Guidance, was launched last month as a pilot scheme. So far 23 people have qualified, having come from JLT, The Pensions Advisory Service and other organisations such as M&S, Royal Mail and ITV.

The qualification will be rolled out to the wider market in the summer following a second pilot scheme over the next few months. It was originally designed for experienced administrators who field regular enquiries from pension scheme members but the PMI and JLT Employee Benefits expect it to attract a wider audience, including paraplanners and advisers.They also say people dealing with the guidance guarantee, such as TPAS and the Citizens Advice Bureau, will find it useful.

“We will allow the market to develop as people come across this certificate and find uses for it. We’ve got a lot of interest from the administrator community and advisers are also asking about it and how it might be suitable for them,” says PMI chief executive Vince Linnane.

“It was developed ahead of the guidance guarantee, so it focuses on joining pensions schemes, divorce and pension benefits, not just around choices at retirement.”

Two years ago JLT Employee Benefits had noticed that trustees and administrators were reluctant to offer guidance to pension scheme members in case they were inadvertently deemed to be giving advice. JLT’s efforts to equip its own staff with the skills needed to deal with member enquiries within the boundaries of non-regulated guidance progressed into the development of a qualification that has been accredited by the Office of Qualifications and Examinations Regulation as level four.

“We saw a gap in the market that was not to step on the toes of the regulated advisers but fill the gap where advisers will not tread,” says JLT Group director Margaret Snowden.

“People facing customers should know what they are talking about and demonstrate that by talking to pension scheme members about their options, listening to members, answering their questions. We are keen we give people as much information as we can to make sensible decisions.”

JLT developed the content for the qualification, while the PMI devised the structure. It comprises one mandatory unit that includes four core elements covering essential knowledge and understanding in areas such as lifestyle factors and financial considerations that impact on pension benefit decisions. There are seven application elements covering the impact of things like divorce and death on pension scheme benefits, and the final assessment which is a telephone call simulation designed to test candidates’ communication with pension scheme members.

“The key differentiator is the assessment on communication. It’s a real scenario over the telephone. An actor plays the part of a member with a dilemma and the conversation is recorded,” says Snowden.

“What we are looking for is people to understand they are not in a position to pick up and offer product information or anything like that because that is strictly in the domain of the IFA,” says Linnane.

“It’s clear on what informed guidance is and what regulated advice is. The telephone conversation is designed to weed that out. This certificate is of most use as a prompt; to ask members if they have all the information from their pension schemes to hand, whether they have thought about the level of spending they will need in retirement, etc.”

Chartered financial planner Paul Gorman, who heads up IFA firm Beaufort Financial Planning (West Midlands) says: “I’d be surprised if there is much demand from advisory firms for this certificate as it has a focus on non-regulated guidance. I can see why TPAS and CAB would be interested as they have a deadline to meet to upskill staff so they are ready to deliver appropriate guidance from April and are probably already up against it. The core knowledge elements seem to have a good fit for this purpose.”

The Whitehall Group director Richard Mattison says: “I assume financial advisers are asking about it so they know what the competition will be doing. One of the features emerging about the guidance guarantee is that it will be delivered by people without sufficient knowledge or qualifications so many of us will be interested to know what level of knowledge the Government is expecting them to have.”

Adviser view


Martin Bamford, Managing director, Informed Choice

The Certificate in Pension Scheme Member Guidance looks really interesting. I suspect that, from a technical perspective, the content would fall below that required by most advisers, especially those who already hold advanced pension qualifications and Chartered status. However, the quality of the qualifications from the PMI has always been very high and held in high regard for pension professionals. In this fast-moving pensions landscape, the qualification would offer an excellent opportunity for bringing knowledge up to date and gaining a better understanding of the guidance system, as it relates to regulated advice.


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There are 3 comments at the moment, we would love to hear your opinion too.

  1. I think your comments are mean-sprited. If we had more diversity in the City – and I include diversity of thinking and experience in that – it would be a better place and serve our customers more effectively.

  2. it’s the lack of diversity that slows progress and allows outdated approach to continue.
    Ultimately this qualification could cause more problems that it solves as it’s not deep enough in the area of soft skills which are the best filter as they highlight areas of misconception

  3. Quietly resigned 30th January 2015 at 5:30 pm

    ‘The Certificate in Pension Scheme Member Guidance looks really interesting’.

    No it doesn’t. You need to get out more.

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