Select committee: Work and Pensions Committee
Recommendation 13
Fifth report - Protecting pension savers—five years on from the Pension Freedoms: Accessing pension savings
Published 18 Jan 2022
Paragraph 61
Addressed to Department for Work and Pensions
Work and Pensions Committee Protecting pension savers – five years on from the Pension Freedoms: Accessing pension savings All items in this report Report on parliament.uk ↗ Inquiry on parliament.uk ↗
Recommendation (the committee's words)
Measures are in place for contract-based schemes to offer investment pathways, but equivalent measures are some way off for trust-based schemes and their final form may differ. This is not an isolated case of different measures being in place for contract-based and trust-based schemes without a clear rationale. We are disappointed that yet again the two pension regulators dealing with savers in near identical positions have failed to coordinate their work resulting in unnecessary risk for members of trust-based schemes and the pension landscape being more confusing than necessary. We recommend that all consultations covering pension 62 Protecting pension savers—five years on from the Pension Freedomss Accessing pension savings regulation should be run jointly by the Pensions Regulator and the Financial Conduct Authority unless there is a clear and published reason for a different approach.
From: Work and Pensions Committee, Fifth report - Protecting pension savers—five years on from the Pension Freedoms: Accessing pension savings (HC 237), paragraph 61, 18 January 2022
Government response
The government responded to the whole report on 27 April 2022 (deadline 18 March 2022).
Summary written by Accountability Index from the government's response. It is not the government's own words.The government "notes" the Committee's report, commits to a call for evidence in May 2022 on occupational scheme decumulation, and declines several recommendations, including automatic Pension Wise bookings, a usage goal and annual reporting.
- On Pension Wise, the government "disagree[s] with the proposal to automatically book Pension Wise appointments", citing risks of inappropriate guidance and disengagement; it does "not support setting a goal" for combined use of Pension Wise and paid-for advice.
- It commits to a Stronger Nudge, in force from 1 June 2022, requiring schemes to offer to book a Pension Wise appointment for members accessing defined contribution benefits.
- On trust-based schemes, it says it would "not be appropriate" to introduce investment pathways-style requirements until more is known, and DWP intends to issue a call for evidence in May 2022.
- It believes an annual assessment of pension freedoms and annual reporting on pensions advice "is not necessary" at this time, but will "keep this recommendation under review".