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Govt comes clean on Pension Wise performance

Pension Wise jenga

Pension Wise guidance appointments are costing almost £500 each, Government data reveals.

The figure comes to light after policymakers bowed to pressure from politicians and the industry to boost transparency around the industry-funded guidance service.

The Government has faced criticism from across the sector for failing to produce data on Pension Wise, which is paid for via an industry levy. This was set at £39.1m in 2015/16, with advisers contributing £4.7m in the first year.

Earlier this year, the influential Work and Pensions committee called on the Government to produce quarterly statistics on the service.

In response, the Treasury has made more granular information on the performance of Pension Wise available via its ‘Performance Platform’. It will be updated monthly and can be accessed here.

The data reveals there have been just over 40,000 face-to-face and telephone appointments since the service was launched, costing an average of £496 each.

Customer satisfaction currently stands at 89 per cent, while there have been almost two million visits to the Pension Wise website since April.

In addition, the Government is procuring external research for Pension Wise to find out what users do following an appointment, and how much it improves their understanding. However, this will not be published until 2017.

The committee also recommended that information on how many people had accessed Pension Wise having been signposted by their existing provider should be tracked. The Government says it will publish this data from March 2016.

Elsewhere, the Treasury confirms that users of Pension Wise will be allowed to access more than one appointment as part of an expansion of the service. It does not say whether savers will be able to have an unlimited number of appointments.

The news comes after Citizens Advice, which is delivering the face-to-face element of pension guidance, came under fire for using Pension Wise staff for non-pension related work.

Data subsequently uncovered by Money Marketing revealed a disparity between the actions of those who take guidance through Citizens Advice and those who receive over-the-phone guidance from The Pensions Advisory Service.

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Comments

There are 8 comments at the moment, we would love to hear your opinion too.

  1. £500 for an unqualified (and not particularly experienced) individual to provide a 30 minute guidance appointment? That’s ridiculous. If this was being run as a commercial enterprise how much do you think you could charge someone to acccess such a service? £100 would sound like a pretty hefty fee and I doubt the satifaction rating would be anywhere near 89% if they were paying for it.

  2. What a waste. If all those enquiries were sent out to the already existing pool of expertise i.e. IFA’s, instead of Citizens advice & Pension Wise, many of us could have not just given guidance, but actual advice, & actioned a solution, & all that for a budget not far exceeding the cost of a call to these quango’s.

  3. At an AVERAGE cost of £500 per APPOINTMENT, this is an outrageously expensive service. I often have 3 or 4 appointments with a retiring client, will provide a written report with advice, from a qualified IFA, and the client has the protection of FOS/FSCS. My service includes provider and investment selection, and assistance with documentation – probably the same as most IFAs. Surely, it would have been far better to issue retirees with a voucher for say £1,000, which the client would need to sign confirming satisfaction, before the IFA could redeem the voucher. If the IFA wanted to charge more, then that would be the responsibility of the client. Better outcomes for everyone – apart from the Pension Wise staff, and the bureaucrats behind it.

  4. £500 eh? That’s useful as a benchmark for my own charges ~ as an adviser, not a guider ~ going forward. And Pensions Wise doesn’t have to pay any levies to the FCA, FOS, FSCS, MAS or even, I expect, any PII premiums. That must be why it’s able to provide such a cracking service at such a modest cost.

  5. £1000 per hour is a great outcome for no regulated advice and no assistance with implementation. Like the above I would usually have 3-4 appointments with retiring clients which probably adds up to 6-8 hours so £8000 a case looks like a reasonable pricing benchmark! (and the customer is getting more out of it)

  6. Just a thought. Would we be accused of overcharging at these hourly rates??

  7. So now we know the cost.

    However, we will not know the effectiveness until 2017.

    Roll on traded annuities.

  8. But surely £19.8 million (40,000 x £496) of public money is well spent and ‘invested’ in the exercise?! (tongue firmly in cheek!…) as someone else has alluded to, users of the service are bound to register a high satisfaction level for anything along these lines that’s not costing them anything directly and personally!..

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