Source · Select Committees · Work and Pensions Committee
Recommendation 16
16
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Pension Wise is a well-regarded but under-utilised service.
Recommendation
Pension Wise is a well-regarded but under-utilised service. The pension freedoms will be seen as a failure if savers make poor decisions without receiving the guidance they were promised when the freedoms were introduced. The Minister for Pensions and Financial Inclusion’s previous agreement that having a Pension Wise appointment should be “the norm” was welcome, but he has since distanced himself from this view. Neither the Minister nor regulators would tell us what they thought the usage levels of Pension Wise should be. It is clearly unrealistic to expect Pension Wise usage to be universal—some people will already have taken paid-for advice or had an earlier appointment for guidance—but that should not be a barrier to setting a stretching target for increasing take up. We recommend that the Government sets a goal for the Money and Pensions Service for the combined use of Pension Wise and paid-for advice when accessing pension pots for the first time. This goal should be at least 60 per cent and expressed in terms of individuals rather than pots. It could include an exemption for smaller levels of saving.
Paragraph Reference:
74
Government Response
Acknowledged
HM Government
Acknowledged
The Money and Pensions Service provides tailored guidance to individuals, based upon the information they provide. For instance, MoneyHelper Pensions (previously known as The Pensions Advisory Service), already provide specialist pensions and divorce appointments and pension rebuild appointments for people who have lost their pension savings and need to rethink their options to rebuild or maximise savings. Pension Wise provides guidance tailored towards individuals, aged 50 or above, who are considering how to access their defined contribution pensions savings. The government supports MaPS’ guidance transformation strategy, which will seek to triage members towards the guidance service most appropriate for them and increase the flexibility of Pension Wise so that it may more be more effectively tailored towards an individual’s needs.