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Industry demands Govt intervenes over Pension Wise funds row

Pension Wise jenga

Providers, advisers and politicians are calling on the Government to investigate how a Citizens Advice delivery centre was able to use Pension Wise-funded staff for non-pensions work.

Earlier today, Money Marketing revealed how the Derbyshire Districts branch redeployed staff funded by a £35m a year levy on financial services firms and advisers.

Citizens Advice says it is an “isolated incident” that has now been rectified.

A senior source at a major provider says: “It’s outrageous. They clearly don’t have proper controls in place. We are pored over by the FCA over our controls and processes to ensure we treat customers fairly. This is clearly an organisation that is very loosely run.

“This should not have come out through a whistleblower, the Government should pick this up – they should be immediately alerted that money is being spent on the wrong things. That’s worrying.”

Apfa director general Chris Hannant says: “The funds that have been raised for the purposes of Pension Wise should only be spent on Pension Wise. If take-up is low and Citizens Advice doesn’t want to terminate staff contracts, then it needs to pay for those salaries itself. I would then expect there to be a rebate to levy paying firms in the following year.

“Citizens Advice needs to have a clear audit trail to demonstrate that funds raised to pay for Pension Wise are being used solely for that purpose. If there is no clear audit trail, a full investigation is needed because we are talking about criminal theft and misappropriation of funds.”

Treasury committee member Mark Garnier MP says: “This is exactly the sort of thing that we need to be worried about and be asking questions about.

“Is there a fundamental problem here? Clearly this highlights, if anyone was in any doubt why the government needs to review pension wise and the services around it on an ongoing basis.

“As a more general point I think there is a problem with debt and the more clever people we have helping with that the better, but that doesn’t mean that the investment community should pay for it.”

Syndaxi Chartered Financial Planners managing director Robert Reid says: “Advisers didn’t sign up to pay for Pension Wise in the first place and we certainly didn’t sign up to pay for Citizens Advice.

“The money was for a specific purpose and Citizens Advice cannot simply do what they want with it. We now need an independent investigation and anyone who is involved needs to be held to account.”

Plan Money director Peter Chadborn says: “This is another example of how easy it is to spend other people’s money. It is very frustrating for anyone running a small business to be funding another organisation which does not have to be accountable for how those funds are deployed.

“Even if it is an isolated incident, it should never have happened in the first place. Any spare money should be refunded to levy paying firms or used to meet the objectives of Pension Wise, for instance by funding additional advertising.”

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Comments

There are 11 comments at the moment, we would love to hear your opinion too.

  1. Our clients end up paying, they need to know who stole their money.

  2. Chris Hannant: “If take-up is low and Citizens Advice doesn’t want to terminate staff contracts, then it needs to pay for those salaries itself. I would then expect there to be a rebate to levy paying firms in the following year”.

    Ha ha ha – a REBATE? To financial services firms? Dream on kiddo.

    There’s as much chance of that as there was of the FSA handing back the money that it admitted it had overcharged firms a few years back.

    Regulated firms are seen as an inexhaustable well that can be tapped into whenever the legislators are a bit short of the readies.

    Bad news about the NHS funding crisis – expect to be tapped up for a few extra quid to plug that gap too chaps.

  3. Rt Hon Sir Arthur Streeb-Greebling 10th October 2015 at 1:34 am

    I don’t understand. Is there a world shortage of p45’s?

    • Dear Mr Cook, glad to see you are alive and well, I heard you died in 1995, can’t trust the press can you? But in case you are just hiding behind another’s created persona, step out and show who you are, or are you THAT asahmed of your crass attempt at humour?

  4. Andy Robertson-Fox 10th October 2015 at 8:18 am

    Of course had the number of staff available to deal with Pension Wise enquiries been insufficient to cope with demand I wonder who would have been the first to blame the government and CAB. Put things into perspective, how much was involved in this isolated case? How much would it have cost to discharge any (possibly only temporary) surplus staff, how would that balance against a possible need to train new staff if the demand increases, do you engage staff in a valuable use of time or leave them to play games on the computers………

  5. The problem is (Andy Robertson-Fox) is that its not an isolated case, its rife and is happening up and down the country.

    Also Pension Wise Guidance Specialists at CAB signed up to do a job delivering face 2 face guidance on the new pension freedoms, NOT to to deal with debt, benefit, housing, employment issues etc etc etc. And some, rightly so, are not comfortable with or want to do such work but are being forced too.

    • Andy Robertson-Fox 12th October 2015 at 9:22 am

      You have evidence to prove this because apart from yourself and a couple of other comments I have seen it is not what is being reported…so, how many offices, how many staff are involved, what is the cost of the “loss”?

  6. I expect CAB/Pension Wise is no different to any other, whom work on a budget collected via/from an exterior source………… use it (in full or more) or lose it !

    in the case of CAB, I believe, they have been under funded for years, so now having the resource, to be able to deploy them (staff) else where (in quite times) is a luxury that has not been affordable in previous years ……….. I suppose I will have a leaning to support something that is, at least, trying to help, rather than, bleed me dry !

  7. This is very serious and an inquiry should immediately be held, led by a respected figure in the quangarity sector who has extensive experience in the field of financial management in complex multi-layered organisations. I nominate Dame Camilla Batmandjhelidh.

  8. So this enquiry, who will be chosen to lead it , how much will they and their team cost? Plus a committee of MPs, more expense. More I would imagine than was spent by CAB in the first place. Probably with no measurable result at the end except perhaps someone being given a golden handshake to leave.
    However it is probably worth the cost for the regulation to make sure lessons are learnt and it doesn’t happen again blah blah blah

  9. I want my £10 back and I am willing to pay £millions in legal and consultancy fees to get it!

    *tongue firmly in cheek*

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