Stephen Lowe, group communications director at Just Retirement, comments on the DWP and Treasury consultation “Public financial guidance review: consultation on a single body”: “A single point of Government contact for people looking for help with financial decisions is a good move, it will give people confidence in the system and make it harder for would-be scammers. And the holistic approach of a single service will undoubtedly provide those approaching retirement with better overall view of their financial position and aid their decision making process. However, until guidance is made the default option for people accessing retirement savings it will not provide a sufficient safety net against poor outcomes; Pension Wise is already a good service but far too few people are using it.”
Commenting on the HMT / DWP consultation on a single financial guidance body (SFGB), Steven Cameron Pensions Director at Aegon said: The government’s decision to bring together all public financial guidance within a single body should make consumer access easier. For many individuals, ‘free’ public guidance will add value, but for others with more complex needs, it’s no replacement for regulated advice. It’s vital that the new body complements and doesn’t compete with valuable regulated advice services with effective signposting and handovers in place that work for consumers.
“There’s a recognised gap in sources of advice, guidance and information for some individuals, and actions following the Financial Advice Market Review are only now being considered. With the private sector expected to develop new innovative guidance models alongside advice with personal recommendations, we’re pleased the Government recognises the need for the new body to adapt to market developments. Adaptability will also be essential if the new body is to keep pace as financial scams are constantly evolving.
“We support those leading the new body being given a strategic role. It is imperative that the regulated advice sector is fully represented in strategic decisions to ensure these two vital services work and develop in tandem.”
Rona Train, partner, Hymans Robertson comments on a new consultation paper looking at creating a single body to provide financial guidance to savers. This would act as a replacement to Money Advice Service, The Pensions Advisory Service and Pension Wise.
“It makes sense to have one source of financial guidance. This will give individuals more clarity on where they need to go to get support. While this is a step in the right direction, we need to remember that these generic advice services are rarely going to give people the levels of support they need in the face of so much more complexity post pension freedoms.
“But people of all ages need more support, not just those approaching retirement or retiring. We’ve analysed the savings of over half a million DC savers and three quarters won’t have enough to secure an adequate income in retirement. The vast majority of workers, of all ages, need better guidance now. If we don’t make that happen we’re storing up serious problems for the future.
“People need access to better tools to help them understand their own personal circumstances. Technology has a big role to play here. The Government’s ambition for a pensions dashboard would help, but there are valid concerns over whether this will be ready by its deadline.
“In addition to having a clear view of what they have in terms of pension savings, people need to be able to appreciate the impact of contributions and withdrawals from their pension schemes – particularly in relation to when they’ll be able to retire with an income that’s adequate – and then what levers they can use to get back on track. Neither the pensions dashboard nor a guidance service can do this. Individuals need advice but can’t or won’t pay for it in most cases. To fill that advice gap we need better online tools, potentially provided through the workplace, that help people understand the impact of their decisions all through their working life to retirement in personal rather than generic terms.”
The consultation paper can be found here:
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