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Protecting pension savers – five years on from the Pension Freedoms: Accessing pension savings

Status: Closed Opened: 23 Feb 2021 Closed: 21 Oct 2022 24 recommendations 9 conclusions 1 report

This inquiry is looking at how savers are prepared and protected to move from saving for retirement to using their pension savings. This is the second of our three-part inquiry, looking at decisions make about accessing their pensions. We concluded taking evidence on our first part, pension scams, in January 2021. We are interested in: … Show more

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Reports

1 report
Title HC No. Published Items Response
Fifth report - Protecting pension savers—five years on from… HC 237 18 Jan 2022 33 Responded

Recommendations & Conclusions

7 items
3 Conclusion Fifth report - Protecting pension saver… Deferred

The Minister for Pensions told us that the Department for Work and Pensions is trying...

The Minister for Pensions told us that the Department for Work and Pensions is trying to make pensions simpler. We support this principle. But simplicity alone is not enough to improve outcomes for savers. The Government and regulators will either need to increase saver engagement—encouraging and enabling savers to make … Read more

Government response AI summary
The government is deferring the response to MaPS and the FCA.
Read full response →
Department for Work and Pensions
6 Recommendation Fifth report - Protecting pension saver… Deferred

Many more people than currently do, however, would benefit from making greater use of the...

Many more people than currently do, however, would benefit from making greater use of the pension freedoms by choosing a mix of annuities, lump sums and drawdown Protecting pension savers—five years on from the Pension Freedomss Accessing pension savings 61 rather than a single product. For example, a person may … Read more

Government response AI summary
The government states that the FCA will be responding to the recommendation separately.
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Department for Work and Pensions
8 Recommendation Fifth report - Protecting pension saver… Deferred

We recommend that the Money and Pensions Service and the Financial Conduct Authority should develop...

We recommend that the Money and Pensions Service and the Financial Conduct Authority should develop proposals to increase the number of people choosing a mix of retirement products—including cash, drawdown and deferred annuities—to meet their changing needs at different stages of later life. Read more

Government response AI summary
The DWP intends to issue a call for evidence in May 2022 to inform whether policy interventions are necessary to support savers in occupational pension schemes, before considering introducing default retirement pathways.
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Department for Work and Pensions
9 Conclusion Fifth report - Protecting pension saver… Deferred

The Pension Schemes Act 2021 enabled collective defined contribution (CDC) schemes, which provide retirement incomes...

The Pension Schemes Act 2021 enabled collective defined contribution (CDC) schemes, which provide retirement incomes from a collective fund. The income from the fund received by members varies depending on how the fund performs. There is demand for the further development of CDC schemes in future and it is therefore … Read more

Government response AI summary
The FCA will be responding to this recommendation separately.
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Department for Work and Pensions
12 Recommendation Fifth report - Protecting pension saver… Deferred

For CDC schemes to provide a realistic alternative to annuities, people with defined contribution pension...

For CDC schemes to provide a realistic alternative to annuities, people with defined contribution pension pots need the option to be able to transfer to decumulation- only CDC schemes. In future these may be available through master-trusts regulated by the Pensions Regulator. We recommend that the Financial Conduct Authority consider … Read more

Government response AI summary
The government will consider the recommendation in more detail, noting a Pensions Policy Institute DC data project and ongoing consultation on Pensions Dashboards Regulations, but does not commit to any specific action at this time.
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Department for Work and Pensions
15 Recommendation Fifth report - Protecting pension saver… Deferred

There is a charge cap for savers who default to a scheme through auto-enrolment.

There is a charge cap for savers who default to a scheme through auto-enrolment. We recommend that there should be a similar charge cap for non-advised savers choosing a decumulation product through investment pathways. The Financial Conduct Authority should report on this as part of its upcoming review on investment … Read more

Government response AI summary
The government states that the FCA will be responding to this recommendation separately.
Read full response →
Department for Work and Pensions
19 Recommendation Fifth report - Protecting pension saver… Deferred

Advice is a personalised recommendation that can only be provided by a regulated firm at...

Advice is a personalised recommendation that can only be provided by a regulated firm at a cost. Few people seem to be willing to pay for financial advice for the decisions they make about their pension savings—even though doing so could significantly improve their financial situation. More people would benefit … Read more

Government response AI summary
The government defers action on reporting annually on progress to increase the uptake of pensions advice, stating that transactions should not be enabled on dashboards initially and future enhancements to dashboards functionality should be decided after the initial offer has been tested with users.
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Department for Work and Pensions

Oral evidence sessions

5 sessions
Date Witnesses
8 Nov 2021 Anna Harvey · HM Treasury, Guy Opperman · Department for Work and Pensions, John Glen · HM Treasury, Pete Searle · Department for Work and Pensions View ↗
25 Oct 2021 Angela Gough · Royal Mail, David Pitt-Watson · Cambridge University, Simon Eagle · Institute and Faculty of Actuaries, The Baroness Altmann CBE View ↗
22 Sep 2021 Alex Connolly · Money and Pensions Service, Carolyn Jones · Money and Pensions Service, Chris Curry · Money and Pensions Service, David Fairs · The Pensions Regulator, Sarah Pritchard · The Financial Conduct Authority View ↗
21 Jul 2021 Colin Clarke · Legal and General, Laura Myers · Lane, Clark & Peacock, Matthew Arends · Aon, Peter Glancy · Scottish Widows, Philip Brown · B&CE, the People’s Pension, Rachel Vahey · AJ Bell, Stephen Lowe · Just Group View ↗
16 Jun 2021 Chris Brooks · Age UK, Dr Julia Mundy · Financial Services Consumer Panel, Joe Dabrowski · Pension and Lifetime Savings Association, Laurie Edmans · Financial Inclusion Commission, Paul McBride · The Society of Pension Professionals, Renny Biggins · The Investing and Saving Alliance, Tess Page · Association of Consulting Actuaries, Yvonne Braun · ABI View ↗

Who gave evidence

28 witnesses
WitnessOrganisationSessions
Alex Connolly · Chief Operating Officer Money and Pensions Service 1
Angela Gough · Head of Corporate Pensions Royal Mail 1
Anna Harvey · Deputy Director (Payments and Fintech) HM Treasury 1
Carolyn Jones · Head of Money and Pensions Guidance Policy and St… Money and Pensions Service 1
Chris Brooks · Head of Policy Age UK 1
Chris Curry · Pension Dashboard Programme Team Money and Pensions Service 1
Colin Clarke · Head of Regulatory Change (Product Development), … Legal and General 1
David Fairs · Executive Director of Regulatory Policy, Analysis… The Pensions Regulator 1
David Pitt-Watson · Leader Tomorrow’s Investor Programme, Royal Socie… Cambridge University 1
Dr Julia Mundy · Member Financial Services Consumer Panel 1
Guy Opperman · Minister for Pensions and Financial Inclusion Department for Work and Pensions 1
Joe Dabrowski · Deputy Director Pension and Lifetime Savings Association 1
John Glen · Minister of State (Economic Secretary) HM Treasury 1
Laura Myers · Partner and Head of DC Lane, Clark & Peacock 1
Laurie Edmans · Commissioner Financial Inclusion Commission 1
Matthew Arends · Head of UK Retirement Policy Aon 1
Paul McBride · COO of HSBC Retirement Services Limited (HRSL) The Society of Pension Professionals 1
Pete Searle · Director, Private Pensions and Arm’s-Length Bodies Department for Work and Pensions 1
Peter Glancy · Head of Pensions Policy Scottish Widows 1
Philip Brown · Director of Policy B&CE, the People’s Pension 1
Rachel Vahey · Senior Technical Consultant AJ Bell 1
Renny Biggins · Head of Retirement The Investing and Saving Alliance 1
Sarah Pritchard · Executive Director – Markets The Financial Conduct Authority 1
Simon Eagle · Senior Director, pensions actuary and GB Head of … Institute and Faculty of Actuaries 1
Stephen Lowe · Group Communications Director Just Group 1
Tess Page · Chair of DC Committee Association of Consulting Actuaries 1
The Baroness Altmann CBE — 1
Yvonne Braun · Director of Policy, Long-Term Savings, Health and… ABI 1

Correspondence

3 letters
DateDirectionTitle
6 Jul 2022 — Correspondence from Money and Pension Service about the Committee’s Report on a…
2 Dec 2021 To cttee Letter from the Chair to the Minister for Pensions and the Economic Secretary t…
24 Nov 2021 — Correspondence with FCA and TPR following up on the 22 September evidence sessi…