Recommendations & Conclusions
20 items
2
Recommendation
Fifty-Seventh Report - AEA Technology P…
Rejected
AEAT pension scheme members have been passed from one part of government to another, with no department taking overall responsibility for their complaints. Scheme members have raised complaints with government since 2012 covering a range of issues that involve several government organisations, including departments and regulators. The Department for Work …
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AEAT pension scheme members have been passed from one part of government to another, with no department taking overall responsibility for their complaints. Scheme members have raised complaints with government since 2012 covering a range of issues that involve several government organisations, including departments and regulators. The Department for Work & Pensions (DWP) initially responded in 2013 on behalf of government by providing a factsheet, which summarised the complaints received and the government’s position on each. Six months later, after members were dissatisfied with the response, DWP wrote to them again saying it was not responsible for the case and directing them elsewhere. DWP had to subsequently apologise for the fact that its factsheet added to the confusion over who was responsible for what. Responsibilities for pensions are spread across government, with different departments responsible for private and public sector pensions. The lack of joined-up thinking on pensions allowed the issue to fall between the cracks. Government has not commissioned any independent review into the complaints raised by AEAT members, and all of the relevant ombudsman services have said they cannot investigate the information government provided in 1996. Recommendation 2: The government should ensure that members’ complaints about the AEAT pension case can be independently reviewed, for example by a relevant ombudsman.
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Government response AI summary
The government disagrees with the recommendation, stating that complaints have already been considered by ombudsmen whose remits are statutory policy matters. It adds that the 2013 Fair Deal policy prevents similar situations from arising again.
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HM Treasury
3
Recommendation
Fifty-Seventh Report - AEA Technology P…
Deferred
The AEAT case shows that there are gaps in the routes of appeal available for people raising complaints about their pensions. It is a fundamental right that 6 AEA Technology Pension Case people have appropriate and accessible routes of appeal. Ombudsman services provide a way for people to seek independent …
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The AEAT case shows that there are gaps in the routes of appeal available for people raising complaints about their pensions. It is a fundamental right that 6 AEA Technology Pension Case people have appropriate and accessible routes of appeal. Ombudsman services provide a way for people to seek independent review of their complaints without the cost of pursuing action through the courts. In this case, ombudsman services such as the Pensions Ombudsman and the Parliamentary and Health Service Ombudsman (PHSO) ruled that they could not examine key complaints raised by AEAT pension scheme members because the complaints fall outside their statutory jurisdictions. For example, PHSO is unable to look into employment matters, including specifically those relating superannuation and pensions, due to its remit. Legislative amendments would be required to change this. Some aspects may have been within the remit of the Pensions Ombudsman but, because the case was more than 15 years old, the ombudsman would have been unable to award any remedy due to the Limitation Act 1980. Government protocols for retaining data may also often prevent relevant information being maintained for long enough to be reviewed in cases involving pensions. Pensions are long-term financial products, and problems can take many years to become apparent. Recommendations 3: The government should review ombudsman arrangements to ensure that all aspects of people’s interactions with their pensions have an adequate route of appeal. We also ask that the Public Administration and Constitutional Affairs Committee consider examining whether the current time limits on government for retaining information and ombudsmen awarding redress are fit for purpose when it comes to pensions.
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Government response AI summary
The government deflects the recommendation, stating that the request for the Public Administration and Constitutional Affairs Committee to consider time limits is a matter for that Committee. It does not address the recommendation to review ombudsman arrangements.
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HM Treasury
4
Recommendation
Fifty-Seventh Report - AEA Technology P…
Accepted
This is another case of government not giving people enough time or support to make complex financial decisions. The government has a role to help people make good financial decisions, because of the detriment that bad choices can lead to. In the case of AEAT, it should have done this …
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This is another case of government not giving people enough time or support to make complex financial decisions. The government has a role to help people make good financial decisions, because of the detriment that bad choices can lead to. In the case of AEAT, it should have done this directly. This was a complex financial decision where members needed clear information on their options and time to seek appropriate financial advice. AEAT scheme members were only given one month to decide between their pension transfer options, and the information they received was insufficient. We have seen similar issues in other areas, including in the private sector where government oversees the regulation of independent financial advice. For example, our inquiry last year into the British Steel Pension Scheme covered the significant financial harm that many scheme members suffered from transferring their pensions after receiving unsuitable advice. We concluded that the regulatory system had left members open to being taken advantage of and that, seven years after the Pension Schemes Act 2015, regulated financial advisers were still not clear on what was expected of them. DWP is developing several initiatives aimed at supporting people to engage with their pensions, such as ‘Pensions Dashboards’ and a recent call for evidence on the support and information people need when accessing their pensions. However, it is not clear when these initiatives might come to fruition and lead to tangible improvements. Recommendation 4: The government should write to us within three months to set out what more it will do to support people to make informed financial decisions, including regarding their pensions. This should include what changes it will make in light of DWP’s recent call for evidence, and an update on progress with Pensions Dashboards. AEA Technology Pension Case 7 1 AEA Technology pensions
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Government response AI summary
The government agrees to write to the Committee detailing actions to support informed financial decisions regarding pensions. It cites specific initiatives already in place, such as the Stronger Nudge to Pensions Guidance and the national rollout of the mid-life MOT, and recent regulations made on …
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HM Treasury
1
Conclusion
Fifty-Seventh Report - AEA Technology P…
Rejected
On the basis of a report by the Comptroller and Auditor General, we took evidence from the Department for Work & Pensions (DWP), the Government Actuary’s Department (GAD) and the Parliamentary and Health Service Ombudsman (PHSO) on the pensions transferred to AEA Technology (AEAT) when it was privatised.1
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On the basis of a report by the Comptroller and Auditor General, we took evidence from the Department for Work & Pensions (DWP), the Government Actuary’s Department (GAD) and the Parliamentary and Health Service Ombudsman (PHSO) on the pensions transferred to AEA Technology (AEAT) when it was privatised.1
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Government response AI summary
The government disagrees, stating that Pension Protection Fund indexation rules are set out in legislation and changing them would require a change in law, which is a policy matter.
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HM Treasury
5
Conclusion
Fifty-Seventh Report - AEA Technology P…
Accepted
When the Atomic Energy Authority Act 1995 was introduced to facilitate the privatisation of AEAT and outline the pension arrangements, it required that the pension benefits in the new AEAT scheme must be “no less favourable” than the previous scheme. Around that time, other privatisations had included government guarantees on …
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When the Atomic Energy Authority Act 1995 was introduced to facilitate the privatisation of AEAT and outline the pension arrangements, it required that the pension benefits in the new AEAT scheme must be “no less favourable” than the previous scheme. Around that time, other privatisations had included government guarantees on their pensions. Ministers also gave assurances in Parliament that pension benefits would be fully protected in the new scheme.5 We asked DWP and GAD how the AEAT pension scheme’s terms could be no less favourable if, as became clear after 2012, it did not have the protection of a government guarantee. The departments told us their understanding was that the phrase “no less favourable” used in legislation referred only to the pension 1 Comptroller & Auditor General, Pensions transferred to AEA Technology when it was privatised, Session 2022–23, HC 1169, 3 March 2023 2 ATC0023; C&AG’s Report, paras 2, 9 3 C&AG’s Report, paras 10–11, 1.5 4 C&AG’s Report, paras 12–14 5 C&AG’s Report, para 1.5, 1.10 8 AEA Technology Pension Case scheme benefits, not their security, meaning the 1995 Act did not provide for a public sector guarantee on the scheme. GAD said that it was on this basis that it will have certified that the new pension scheme met the terms of the 1995 Act.6
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Government response AI summary
The government states that its 2013 Fair Deal policy means that similar circumstances would not occur again, as pensions in future privatisations would remain in public sector schemes.
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HM Treasury
6
Conclusion
Fifty-Seventh Report - AEA Technology P…
Acknowledged
None of the information government provided to scheme members told them the government guarantee would be lost if they transferred their accrued benefits into the new pension scheme.7 We asked GAD why members were not told this, and whether the note it had provided at the time was therefore misleading. …
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None of the information government provided to scheme members told them the government guarantee would be lost if they transferred their accrued benefits into the new pension scheme.7 We asked GAD why members were not told this, and whether the note it had provided at the time was therefore misleading. GAD said it did not believe the note was misleading, and that it was intended to assist members with making decisions over their pensions rather than be financial advice which members could depend upon. GAD noted that while the information provided to members did not tell them the new scheme would not have a government guarantee, it had never indicated that the new scheme would still have one either. GAD also argued that some information provided made references to the possibility that the scheme could fail.8 However, those same references also stated that pension scheme assets are protected in law.9
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Government response AI summary
The government acknowledges the complexity of pension decisions and outlines various initiatives like the Stronger Nudge to Pensions Guidance, mid-life MOT, and Pensions Dashboards to support people in making informed decisions about their pensions, without directly addressing the conclusion about the specific loss of government …
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HM Treasury
7
Recommendation
Fifty-Seventh Report - AEA Technology P…
Accepted
GAD’s note suggested that scheme members seek independent financial advice if they were unsure of the most suitable course of action.10 We asked GAD whether it was realistic for scheme members to get independent financial advice, particularly when GAD is a well-recognised authority on public sector pensions and members were …
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GAD’s note suggested that scheme members seek independent financial advice if they were unsure of the most suitable course of action.10 We asked GAD whether it was realistic for scheme members to get independent financial advice, particularly when GAD is a well-recognised authority on public sector pensions and members were only given one month to make their decision. GAD told us that the range of individual circumstances which members may have been in would have made it impossible for the note to provide appropriate financial advice for each individual. GAD also said that the fact the note mentions that it was not financial advice should have been a sign that this was a matter to take seriously. GAD told us it did not believe the note would have been the only basis on which members made their decision.11 However, nearly 90% of scheme members transferred their benefits. Scheme members have said their decision was heavily influenced by GAD’s note, given GAD’s role as a professional body independent of the pension scheme, and the stated intention of the note to “outline the main factors to take into consideration in deciding whether or not to transfer”. Scheme members have also reported that independent financial advisors who were consulted largely deferred to GAD’s note.12
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Government response AI summary
The government agrees to support informed pension decisions by September 2023, committing to write to the Committee with specific actions and highlighting initiatives like the Stronger Nudge to Pensions Guidance and Pensions Dashboards.
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HM Treasury
8
Conclusion
Fifty-Seventh Report - AEA Technology P…
Rejected
Since the scheme entered the PPF, members have lost money in real terms each year because the compensation they receive does not include rises for inflation. PPF compensation initially provides members 100% of their pension if they had already reached the scheme’s normal pension age, or 90% for those who …
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Since the scheme entered the PPF, members have lost money in real terms each year because the compensation they receive does not include rises for inflation. PPF compensation initially provides members 100% of their pension if they had already reached the scheme’s normal pension age, or 90% for those who had not. Compensation on pensions earned after 6 April 1997 increases each year in line with inflation, up to a maximum of 2.5%. However, benefits accrued before 6 April 1997, including all benefits transferred in 1996, are not increased for inflation at all.13 Scheme members who wrote to us described the damaging effects of the loss of inflation protection on many years of pension benefits, in one case losing over 40% of their pension in real terms.14 We asked 6 Q 2 7 C&AG’s Report, para 1.10 8 Qq 15, 20, 23–26, 53 9 Q 32; C&AG’s Report, para 1.9 10 Q 33; C&AG’s Report, para 1.11 11 Qq 52, 54–55 12 Q 54; C&AG’s Report, para 1.13 13 Q 79; C&AG’s Report, para 2.6 14 ATC0001; ATC0004; ATC0016; ATC0022 AEA Technology Pension Case 9 DWP whether the mechanism used to provide restitution for Equitable Life pensioners could be used in this case. DWP was unable to comment on any comparison to Equitable Life, but responded that the PPF was the mechanism government had set up to provide compensation in cases such as AEAT’s.15 The government’s response to complaints
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Government response AI summary
The government rejects the recommendation, stating that changing the Pension Protection Fund indexation rules would require legislative change and is therefore a policy matter on which they cannot respond further.
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HM Treasury
9
Conclusion
Fifty-Seventh Report - AEA Technology P…
Rejected
From 2012 onwards, scheme members raised a series of complaints with multiple government organisations and were dissatisfied with the responses they received. In July 2013, DWP produced a factsheet summarising the complaints government had received and a response to each on behalf of the government. In February 2014, it then …
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From 2012 onwards, scheme members raised a series of complaints with multiple government organisations and were dissatisfied with the responses they received. In July 2013, DWP produced a factsheet summarising the complaints government had received and a response to each on behalf of the government. In February 2014, it then sent scheme members a further letter explaining that it was not responsible for the case.16
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Government response AI summary
The government rejects the conclusion, stating that complaints were already considered by relevant government bodies. They indicate that changing an ombudsman's remit is a policy matter, and existing 2013 Fair Deal policy prevents similar circumstances from reoccurring.
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HM Treasury
10
Conclusion
Fifty-Seventh Report - AEA Technology P…
Rejected
When we asked it why no part of government had taken responsibility for the issue, DWP described pensions policy as a complex and wide-ranging area which touches on a number of departments. DWP is responsible for private sector pensions rather than public sector pensions, which it told us are the …
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When we asked it why no part of government had taken responsibility for the issue, DWP described pensions policy as a complex and wide-ranging area which touches on a number of departments. DWP is responsible for private sector pensions rather than public sector pensions, which it told us are the responsibility of HM Treasury and the Cabinet Office.17 We asked why DWP initially responded to complaints on behalf of government, before saying it was not responsible and directing members to other parts of government such as the then Department for Business, Innovation and Skills or the Parliamentary and Health Service Ombudsman (PHSO). DWP responded that its factsheet was aimed at answering questions as well as it could by setting out government’s position on different issues. However, DWP acknowledged that the factsheet had not been clear about who was responsible for what, and that it had to subsequently apologise for the fact that the factsheet added to the confusion.18
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Government response AI summary
The government rejects the recommendation, stating that changing the ombudsman's remit is a policy matter and the 2013 Fair Deal policy prevents similar situations from reoccurring.
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HM Treasury
11
Conclusion
Fifty-Seventh Report - AEA Technology P…
Rejected
Government has not commissioned any independent review into the complaints raised by AEAT members, and all of the relevant ombudsman services have said they cannot investigate the information government provided in 1996.19 PHSO told us it is unable to investigate personnel and superannuation matters, and that this would require a …
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Government has not commissioned any independent review into the complaints raised by AEAT members, and all of the relevant ombudsman services have said they cannot investigate the information government provided in 1996.19 PHSO told us it is unable to investigate personnel and superannuation matters, and that this would require a legislative change to allow it to look into the issue properly.20 We asked DWP what the Minister of State for Pensions was referring to when he wrote in 2020 that the matter had been thoroughly investigated. DWP told us that the Minister was referring to the large amount of correspondence on the issue and two Westminster Hall debates, rather than any specific investigation or review.21
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Government response AI summary
The government rejects the recommendation, stating that changing the ombudsman's remit is a policy matter and the 2013 Fair Deal policy ensures similar circumstances will not reoccur in the future.
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HM Treasury
12
Conclusion
Fifty-Seventh Report - AEA Technology P…
Rejected
We asked how government can ensure that, if a similar thing were to happen again, pensioners making complaints would not be shunted from pillar to post in trying to make appeals and getting no advice or satisfaction. DWP told us that the government’s Fair Deal policy introduced in 2013 means …
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We asked how government can ensure that, if a similar thing were to happen again, pensioners making complaints would not be shunted from pillar to post in trying to make appeals and getting no advice or satisfaction. DWP told us that the government’s Fair Deal policy introduced in 2013 means that these specific circumstances would be unlikely to happen again, as in cases of privatisation the pensions would now be expected to remain in public sector schemes.22 PHSO said that it would be helpful if government considered ombudsman jurisdictions at the formative stages of policy, to avoid gaps such as these. It 15 Q 79 16 C&AG’s Report, para 3.2, 3.6 17 Qq 28, 32 18 Qq 56–57, 67 ; C&AG’s Report, para 3.9 19 Q 66; C&AG’s Report, para 16 20 Qq 41–43 21 Q 66 22 Qq 31, 68, 80 10 AEA Technology Pension Case also told us it had been working with government departments to produce complaints standards, with an aim to move towards consistent practice in how government handles complaints. PHSO told us that a common theme in its investigations is the need for clear communication of change by government so that people can think properly about the options available to them.23 DWP said it would be careful to ensure responsibilities are set out more clearly in any similar case in future.24 23 Q 74–74 24 Q 67 AEA Technology Pension Case 11 2 Lessons for pensions and financial advice Routes of appeal for complaints about pensions and advice
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Government response AI summary
The government rejects the recommendation, stating that changing the ombudsman's remit is a policy matter and the 2013 Fair Deal policy ensures similar circumstances will not reoccur in the future.
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HM Treasury
13
Conclusion
Fifty-Seventh Report - AEA Technology P…
Deferred
It is a fundamental right that people should have appropriate and accessible routes of appeal. Actions by government bodies are in principle subject to judicial review through the courts, but this is an expensive process.25 Ombudsman services provide a way for people to seek independent review of their complaints without …
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It is a fundamental right that people should have appropriate and accessible routes of appeal. Actions by government bodies are in principle subject to judicial review through the courts, but this is an expensive process.25 Ombudsman services provide a way for people to seek independent review of their complaints without the cost of pursuing action through the courts. They are independent statutory organisations set up to make final decisions on complaints that cannot be resolved. Where they make a decision in favour of the complainant, they can typically award or recommend redress.26
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Government response AI summary
The government agrees with the recommendation and will conduct an independent review of The Pensions Ombudsman in Autumn 2024, noting the department can request consideration of other relevant areas during this review.
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HM Treasury
14
Conclusion
Fifty-Seventh Report - AEA Technology P…
Deferred
In the case of the AEAT pension scheme, relevant ombudsman services said they were unable to properly investigate key aspects of scheme members complaints.27 Some aspects of the case could be reviewed. For example, GAD described to us how complaints about work done by individual actuaries who are members of …
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In the case of the AEAT pension scheme, relevant ombudsman services said they were unable to properly investigate key aspects of scheme members complaints.27 Some aspects of the case could be reviewed. For example, GAD described to us how complaints about work done by individual actuaries who are members of the actuarial profession can be raised through disciplinary and complaints processes of the Institute and Faculty of Actuaries and the Financial Reporting Council.28 The Pensions Ombudsman reviewed the approach taken by scheme trustees when the company went into administration in 2012, and PHSO examined DWP’s 2013 factsheet for scheme members.29 But none of these organisations has examined the information that government provided in 1996, with the ombudsman services saying it is outside their statutory jurisdictions.30
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Government response AI summary
The government agrees with the recommendation and will conduct an independent review of The Pensions Ombudsman in Autumn 2024, noting the department can request consideration of other relevant areas during this review.
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HM Treasury
15
Conclusion
Fifty-Seventh Report - AEA Technology P…
Deferred
PHSO described to us the gaps in its remit which prevent it from providing pension scheme members with a route to appeal in this case or in similar situations. PHSO explained that its jurisdiction only allows it to investigate GAD on a very specific point about insurance companies during a …
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PHSO described to us the gaps in its remit which prevent it from providing pension scheme members with a route to appeal in this case or in similar situations. PHSO explained that its jurisdiction only allows it to investigate GAD on a very specific point about insurance companies during a defined period of time, following an amendment to its legislation that allowed it to investigate the Equitable Life pensions case. Apart from this, Schedule 3 of PHSO’s legislation prevents it from looking into personnel and superannuation matters which means it cannot examine information of the type that GAD provided in 1996. An amendment would be needed to the legislation for PHSO to able to look into the AEAT case or similar issues and have powers to make recommendations to government.31
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Government response AI summary
The government agrees with the observation, stating that The Pensions Ombudsman will undergo an independent review in 2024, during which the department can request consideration of additional areas, without committing to amend PHSO's legislation.
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HM Treasury
16
Conclusion
Fifty-Seventh Report - AEA Technology P…
Deferred
The Pensions Ombudsman may also be a suitable body to investigate the administration and management of pension schemes, as it is the expert in government for investigating pensions complaints.32 However, it has no remit over the role of GAD in providing information to scheme members. The Pensions Ombudsman could in …
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The Pensions Ombudsman may also be a suitable body to investigate the administration and management of pension schemes, as it is the expert in government for investigating pensions complaints.32 However, it has no remit over the role of GAD in providing information to scheme members. The Pensions Ombudsman could in theory have examined UKAEA as the outgoing employer, but not AEAT itself as it no longer existed. However, it decided that even if it did investigate information provided by UKAEA, the Limitation Act 1980 means it would not be able to award any remedy as more 25 Qq 47–48 26 C&AG’s Report, para 3.8 27 C&AG’s Report, para 16 28 Qq 8–9 29 Qq 50, 56; C&AG’s Report, para 3.9 30 C&AG’s Report, para 3.10 31 Qq 41–45 32 Qq 9, 74 12 AEA Technology Pension Case than 15 years had passed between the original transfer of pension benefits and when the complaints were made.33 Government protocols for retaining data may also often prevent relevant information being maintained for long enough to be reviewed in cases involving pensions. Pensions are long-term financial products, and problems can take many years to become apparent.34 DWP told us that the Pensions Ombudsman is reviewed on a regular basis, and that its next review later this year may be a good opportunity to look at the role of the ombudsman.35 Government support for complex financial decisions
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Government response AI summary
The government agrees with the recommendation and will conduct an independent review of The Pensions Ombudsman in Autumn 2024, stating the department can request the reviewer considers other areas that would benefit from their consideration.
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HM Treasury
17
Conclusion
Fifty-Seventh Report - AEA Technology P…
Accepted
The AEAT case is one where government directly provided information intended to help pension scheme members decide what to do with their accrued pension benefits. Members were only given one month to make the decision, and consider that the information provided was insufficient and misleading.36 GAD acknowledged that in the …
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The AEAT case is one where government directly provided information intended to help pension scheme members decide what to do with their accrued pension benefits. Members were only given one month to make the decision, and consider that the information provided was insufficient and misleading.36 GAD acknowledged that in the present day, only giving people one month to make a financial decision of this kind would be judged to be inappropriate.37
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Government response AI summary
The government agrees with the recommendation and will inform the Committee of actions taken to support informed pension decisions. They cite recent steps like the Stronger Nudge to Pensions Guidance, national mid-life MOT delivery, and new regulations for Pensions Dashboards.
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HM Treasury
18
Conclusion
Fifty-Seventh Report - AEA Technology P…
Accepted
This committee has previously found similar issues with how government provides or oversees support for people making complex or long-term financial decisions, including through the regulation of independent financial advice. Most recently, our inquiry last year into the British Steel pension scheme found that pensions regulators had failed to provide …
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This committee has previously found similar issues with how government provides or oversees support for people making complex or long-term financial decisions, including through the regulation of independent financial advice. Most recently, our inquiry last year into the British Steel pension scheme found that pensions regulators had failed to provide adequate information and support to scheme members to make decisions within tight deadlines, leading to unsuitable financial advice that caused serious financial harm. We concluded that the regulatory system had left pension scheme members open to being manipulated and taken advantage of by unscrupulous financial advisers, and that regulated financial bodies were still not clear on what was expected of them.38
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Government response AI summary
The government agrees with the recommendation and will inform the Committee of actions taken to support informed pension decisions. They cite recent steps like the Stronger Nudge to Pensions Guidance, national mid-life MOT delivery, and new regulations for Pensions Dashboards.
Read full response →
HM Treasury
19
Conclusion
Fifty-Seventh Report - AEA Technology P…
Accepted
This committee’s 2016 report on financial services mis-selling similarly concluded that the Financial Conduct Authority was not doing enough to ensure that consumers understand the financial products they are buying. The report found that even the most knowledgeable consumers can find financial services too complex to understand, which emphasises the …
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This committee’s 2016 report on financial services mis-selling similarly concluded that the Financial Conduct Authority was not doing enough to ensure that consumers understand the financial products they are buying. The report found that even the most knowledgeable consumers can find financial services too complex to understand, which emphasises the importance of providing adequate support to consumers making financial decisions.39 While not a financial product, this committee also saw similar themes in its 2018 inquiry into the higher education market. The report found that young people taking out student loans were not properly supported to make decisions on higher education that affected their future careers, in large part due to insufficient and inconsistent careers advice.40
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Government response AI summary
The government agrees with the recommendation and will inform the Committee of actions taken to support informed pension decisions. They cite recent steps like the Stronger Nudge to Pensions Guidance, national mid-life MOT delivery, and new regulations for Pensions Dashboards.
Read full response →
HM Treasury
20
Conclusion
Fifty-Seventh Report - AEA Technology P…
Accepted
We asked DWP how government can ensure it gives clearer and more accessible financial advice in similar situations in future. DWP told us that changes to policy on privatisations and transfers of pensions meant that the specific circumstances affecting 33 Qq 50–51; C&AG’s Report, paras 3.10–3.11 34 Qq 44, 51 …
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We asked DWP how government can ensure it gives clearer and more accessible financial advice in similar situations in future. DWP told us that changes to policy on privatisations and transfers of pensions meant that the specific circumstances affecting 33 Qq 50–51; C&AG’s Report, paras 3.10–3.11 34 Qq 44, 51 35 Q 74 36 Q 66; C&AG’s Report: para 1.7 37 Q 55 38 Committee of Public Accounts, Investigation into the British Steel Pension Scheme, Fourteenth Report of Session 2022–23, HC 251, July 2022, paras 2, 5 39 Q 54; Committee of Public Accounts, Financial services mis-selling: regulation and redress, Forty-first Report of Session 2015–16, HC 847, May 2016, para 4 40 Committee of Public Accounts, The higher education market, Forty-fifth Report of Session 2017–19, HC 693, June 2018, para 2 AEA Technology Pension Case 13 AEAT pensioners would be unlikely to happen again. More generally, it told us it has worked with the Financial Conduct Authority and the Pensions Regulator to strengthen the protections around financial advice on pensions. DWP said that encouraging engagement with pensions is difficult, and government has been considering how best to nudge people to seek financial guidance or advice, such as through the introduction of a pensions dashboard. DWP wrote to us after our evidence session to explain the ways it is trying to support people to engage with their pensions. This includes new regulations that came into force in 2022 to ensure nobody can transfer their savings through pension freedoms without either receiving Pension Wise guidance or opting out of it. It also includes initiatives under development such as Pensions Dashboards and DWP’s recent call for evidence on the support and information people need when accessing their pensions. However, DWP did not indicate when these initiatives might come to fruition and lead to tangible improvements.41 41 DWP letter to Committee dated 4 April 2023 14 AEA Technology Pension Case
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Government response AI summary
The government agrees, committing to write to the Committee by September 2023 to outline actions for supporting informed pension decisions through advice, guidance, and reduced complexity, alongside ongoing initiatives like the Stronger Nudge and Pensions Dashboards.
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HM Treasury