Source · Select Committees · Work and Pensions Committee
Recommendation 14
14
Paragraph: 62
The Department for Work and Pensions and the Pensions Regulator are developing proposals for equivalent...
Recommendation
The Department for Work and Pensions and the Pensions Regulator are developing proposals for equivalent measures to investment pathways for trust-based schemes. We recommend that investment pathways should have the same form for contract- based and trust-based schemes.
Paragraph Reference:
62
Government Response
Acknowledged
HM Government
Acknowledged
The government believes that individuals should be trusted with their own hard-earned savings and have a choice about how to access their pension income. The government introduced the Pensions Advice Allowance (PAA) in 2017 in response to the Financial Advice Market Review published in 2016. HM Treasury and the FCA continue work to monitor the take-up and effectiveness of the Pension Advice Allowance in the context of wider work to address the outstanding policy challenges in the UK’s financial advice market. Amending the level of PAA would depend on the changes that were being made. The regulations which established the PAA are part of the 2017 amendments to the Registered Pensions Schemes (authorised payments) regulations 2009 which sets out the conditions Government and Financial Conduct Authority Responses to the Committee’s Fifth Report 13 for the PAA payment including that the payment does not exceed £500. Therefore, if we were to make any changes it would likely require amending this legislation through a statutory instrument. We continue to monitor the uptake of the PAA to understand the success of the scheme. The government is keeping the level of PAA under review and continues to assess how well it is working, including considering any next steps following the evaluation of the Financial Advice Market Review in 2020 led by the Financial Conduct Authority (FCA).