The Pensions Advisory Service estimates 25 per cent of retirees will take up pensions guidance next year, rising to 75 per cent in future years.
Speaking at a Pension Schemes Bill committee today, TPAS chief executive Michelle Cracknell said she expects 100,000 people to take up guidance next year.
The estimates jar with the Legal & General pilot, in conjunction with TPAS and LEBC, which saw only 2.5 per cent take-up from 9,000 people in April and May this year.
Cracknell called on the FCA and providers to do more to ensure savers are directed to guidance with a number of checks and active prompts.
She hit out at the amount of information received by retirees, saying it often left them overwhelmed and more likely to put off decisions or make none at all.
Cracknell said: “Our ambition is very high and that 75 per cent of people will take up the guidance. However, we don’t think that will be from day one. The calls we are receiving at the moment are people with a small defined contribution pension provision and pension elsewhere.
“It suggests there will be less interest in taking the guidance because it’s a smaller decision for individuals. Initially, our estimate is 25 per cent and then we will need to work hard to drive it up, especially as DC becomes a bigger element in people’s pension provision.”
Cracknell also fleshed out how guidance will work in practice, with an average at-retirement phone call currently taking 25 minutes and a guidance call next year taking 45 minutes including preparation.
She also revealed TPAS is recruiting 16 staff with more to come and dismissed suggestions there were not enough quality people.
TPAS will pay an average of £30,000 a year for staff with 10 years of pension knowledge and aptitude to speak to the public. They will also undergo a two-month training programme of written and verbal communication.
Speaking to Money Marketing before today’s session, Moneysavingexpert.com founder Martin Lewis says: “I am worried where Citizens Advice and TPAS will recruit people from. With pension reforms there is a lot of need for qualified pension staff. There is no problem with CAB or TPAS doing it but I am worried whether there are enough qualified people available.”