The House of Commons Work and Pensions Committee has published its first report on Pension Freedoms since the new rules were introduced in April. At the time the move was heralded because it gave people more control over their pensions, letting them decide how to invest their money rather than having very limited options such as an annuity. The new report takes a look at the current situation six months on.
The most headline-worthy statement in the report is the finding that a gap in the financial advice market has appeared. With people having more freedom with their pensions there is more pressure to ensure they have the right access to advice and guidance. However, this may be leading to accessibility issues.
When they introduced Pension Freedoms the Government launched their own service to try to give people the advice they needed. Pension Wise was designed to fill the gap in the market and ensure that people unable or unwilling to pay to speak to an advisor could still get the support they needed. The idea was promising, but not many people have actually taken it up.
The Work and Pensions Committee is urging the Government and Financial Conduct Authority to reassess the situation and create a more holistic solution than the current one. At the same time they praised the private sector for their response to the issue. A number of financial advisors have introduced innovative products to help meet the needs of consumers and bridge the gap in the market.
The report also called on the Government to publish statistics about the results of Pension Freedoms. It has been six months since the changes were introduced and there is still reticence to make the figures available to show what the response has been. The Committee recommends conducting research into the impact the move has had and the potential for the long term.
We understand the new need for clear, honest pensions advice and strive to support each and every client that visits us. Our financial advisors in Middlesbrough are dedicated to helping our clients obtain the details they need to decide how to invest their pension. We strive to offer value for money and uphold the highest standards of professionalism.