The Financial Conduct Authority and the Pensions Regulator have announced a joint regulatory strategy aimed at improving retirement outcomes for consumers.
This will include a wide-ranging strategy review next year, which will focus on the entire pensions journey. This will take an in-depth examination of the tools needed to enable people to make better decisions about their pensions and retirement.
The statement said the FCA and TPR would “use their powers” to drive value for money for members of pension schemes. This will include the setting and enforcement of clear standards and principles where relevant.
As part of this joint initiative the watchdogs said they have identified four key issues to address:
· People struggling to maximise their pension savings
· Money not being managed in line with savers needs
· Pensions not being well looked after
· People not being enabled to make good decisions.
Hargreaves Lansdown head of policy Tom McPhail says: “A closer working relationship between the regulators can only benefit pension savers.
“There’s a clear indication that they’re targeting personal ownership of retirement to plug the saving shortfall in the auto-enrolment regime.
“The review of what is needed to help people make considered pension decisions should bring how to successfully engage members with planning for life after work to the fore.”
He adds: “We welcome the focus on helping and guiding investors to make better decisions. Achieving this will depend on pension schemes and providers having the latitude to personalise the guidance they deliver to their customers.
He says that it is “vital” that the new single finance guidance body and the pensions industry can formulate an effective working partnership to deliver the goals identified in this new strategy.
Aegon also welcomed this ‘joined up’ pensions strategy ,and the focus on the consumer pensions journey.
The insurer’s pensions director Steven Cameron says: ““While the FCA and the Pensions Regulator have different remits, there is now so much overlap that it’s very welcome to see a joint regulatory strategy which we hope will lead to a long-term consistent approach across contract and trust based pensions.
“This will benefit members who often have both types of pension as well as ensuring efficiencies for schemes and providers through consistent regulation.
“We particularly welcome the new joint review of the consumer pensions journey which should focus on how schemes, providers, advisers and guidance services can work together to support individuals.”