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Govt urged to lift Pension Wise restrictions

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Savers should be able to access more than one free session of face-to-face pension guidance from Pension Wise, Citizens Advice has told MPs.

In its written evidence submission to the Work and Pensions select committee, filed ahead of today’s oral evidence sessions, Citizens Advice says restrictions on appointments should be lifted.

Citizens Advice chief executive Gillian Guy says: “We know people are getting what they need from a Pension Wise session but there is an opportunity to provide further support, whether that’s another appointment later in life or, for example, extra help around the implications for someone’s pension if they are divorced.”

The service, which provides retirement guidance alongside The Pensions Advisory Service, argues that while it supports the extension of Pension Wise to 50-54 year olds announced in the Budget, many could benefit from guidance throughout the accumulation phase.

Equally, it says some users would like a second session to finalise their plans, while others may still want guidance after they start withdrawing savings.

It says: “We suggest the service should be made available to these people, perhaps linked to periodic prompts from providers to encourage them to take stock of their position.

“This will help guard against the risk that people run out of funds too early, or remain invested in assets wit ha risk profile that no longer matches their appetite.”

In addition, Citizens Advice says Pension Wise could offer a more personalised service, allowing it to incorporate support for customers with other financial questions.

It further argues that Pension Wise should provide simple tools to allow savers to produce their own plans for use of their DC pot.

These could allow savers to allocate different sums to different options to get broad indications of how long their money might last in comparison to life expectancy, Citizens Advice says.

It adds: “If this can be achieved, and referrals onto regulated advice can be improved, this will go a long way to helping more consumers get the personalised guidance and advice they need to make the best choices about their pensions”

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Comments

There are 17 comments at the moment, we would love to hear your opinion too.

  1. And who will pay for this? Oh yes the adviser community you want to put out of business.

    Muppets.

  2. Samantha Nicholls 7th September 2015 at 12:49 pm

    To be honest there is capacity in the Pension wise to do this now

  3. Do what you like, refer people don’t refer people, just pay for it from OPM not mine!

  4. Is that One Mr Kelly late of the Ullathorne Grammar School, the Pru, AD & latterly of Positive solutions?

  5. Surely they are stepping into the regulated areas advising on risks and suitability.

    Meanwhile somebody else is paying for it all – our clients. Maybe I should apply to the treasury to help pay my clients fees.

  6. Should we be asking what (if any) qualifications do the pension wise and citizen advice staff have to give face to face advice.

    After all I thought it was written into the FCA Handbook that to give financial advice in the area of pensions on a face to face premises you have to hold at least a diploma level 4 in financial services.

    When is the regulator going to enforce its own rules and use the correct language when describing these services as they are information only services and not advice services.

    It is important that we do have this type of service but it should be correctly labelled with a decent referral system in place.

  7. It’s a sort of “make up your own rules as you go” Peter , whereas we professional advisers have to toe the line at all times these people can do anything they want and we will pay for it.
    Farcical situation, thanks George.

  8. Predictable responses “we have to pay for it, our clients pay for it” etc. Take a look at what the actual cost is to a regulated firm – examples: turnover £200,000 – £10 yes ten pounds per year, turnover £2M – about £360 per year. Absolutely extortianate and an obvious business buster for some it would seem!

    • Well it won’t be £10 a year when the govt. loans stop and the service is expanded. Further, the fact that they can dip in and take ANY amount of money is a prerequisite for them to take what they need, so wise up and get the bigger picture in all of this Graham!

      • Steve, with set up costs out of the way hopefully year 2 costs will reduce. Even if they stay the same and the advisory sector picked up the WHOLE tab, the £10 would rise to a heady £65 to £70 per year, by which time you would have received referrals (as I supect you may be now) and written business on clients better informed and pro rather than anti the advisory sector. PW guidance specialists do in fact educate clients to the benefits of regulated advice so I would say your £10 is pretty good value!

        • ‘Hopefully year 2 costs will reduce’ – This is standard Government argument to everything! The same was said about the Dartford Tunnel many many years ago – once we have recouped the costs of building it will be free – and now it is more expensive than ever!!

          principles dont pay the rent, but the principle still remains why should the financial services sector pay for government projects? The facts are most people dont want to pay for advice and want it to be free. The masses of referrals we are getting – well as soon as fees are discussed the phone goes quiet and we dont get our £10 a year back (next year £20, the year after £30!). I have no doubt PW workers explain the benefits of using an adviser, but as soon as the banks get back into this field (and they will) they wont be using ‘paid for’ advisers they will use the ‘free’ bank adviser and our £10 wont have been well spent!

          • Maybe people want advice for free is because the costs were never explained well enough pre the RDR. Commission was a fee in disguise, maybe if it had been explained that it was coming out of the client’s pocket the situation woukld be different now. Still that is looking back, and won’t solve the current issue. Clients leaving PW interviews should understand the value of regulated advice/advisers and be expecting to pay a fair fee for their services.

  9. Remember;
    All government bureaucracies grow until they fail, taxes rise until the taxed refuse to pay/fail and politicians spend/borrow to maintain power until thrown out of office.
    And:
    As all politicians know from day one when robbing Peter to pay Paul you can always count on the support of Paul (see the tyranny of the majority).

  10. So Pensionwise mission creep begins.

  11. Graham firstly turnover doesn’t equal profit. Secondly it isn’t the cost but the principle of the matter; why should the adviser community, and their clients, pay for this service and more importantly when claims are made against the FSCS who will pick up the tab?

  12. Sean, thank you for that lesson (hmm). Hard to argue principle over such a trivial amount, rather join in the action against FSCS levies and fines not being offset etc. Also where are these “complaints” going to come from and for what reasons? I would look to my own house (IFA sector) before I started throwing stones!

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