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LTC lord warns on danger of misselling debacle

The pension misselling scandal will be repeated unless the Government introduces regulation of long-term care products, warns Labour Lord David Lipsey.

Lipsey, a member of the royal commission on LTC, was speaking at a Labour conference fringe meeting discussing who should pay for LTC costs.

He says, because of the complex nature of LTC products and the low level of understanding among both the public and advisers, the potential exists for another big misselling scandal unless the Government acts soon.

Financial Secretary to the Treasury Stephen Timms said there is no need to rush in with the “heavy hand of full regulation” to an industry that is still small. He says the industry is unlikely to grow to mass-market size so the Government can afford to take its time about the decision to regulate.

Lipsey says: “The pension misselling scandal will be repeated in spades as people prey on the fears of consumers who will not have the assistance of the state to safeguard their interests. The Government must bring in regulation of LTC products, and ensure those who are selling them know what they are selling.”

Timms says: “We are looking to consult on the need for regulation. I think we are right to be cautious about rushing into regulation.”

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