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Strong demand for advice in Personal Accounts, according to new survey

Over 70 per cent of callers in a recent survey by the Pensions Advisory Service have said they would need advice as to whether they should opt to stay in or come out of the new system of personal accounts likely to come into effect in 2012.

An even higher per centage said if they did stay in they would need advice as to how to invest their contributions (79 per cent) and on whether they were paying enough (76 per cent).
The support for advice conflicts with comments made by Tony Blair’s first pensions minister John Denham at the NAPF annual conference this year that individual advice on the relative merits of opting out would only encourage opt-outs.
He said: “We must foster a culture where opt-outs are genuinely discouraged. It is important we do not give too much ground to people who promote advice-type issues.”

Elsewhere in the survey 78 per cent were generally in favour of the new personal accounts scheme with 74 per cent supportive of the plans for automatic entry. 42 per cent thought the Government should go further and make membership for employees compulsory.

When asked whom they would trust to run the scheme, 64 per cent said the Government with only 36 per cent in favour of insurance companies or employers.

TPAS chief executive Malcolm McLean says: “It is very significant that the majority of people we surveyed felt they needed some form of advice before committing themselves to personal accounts.”


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