Pension savers risk missing out on targeted support with retirement decisions because of differences in pension regulation, according to People’s Pension.
The provider supports targeted support as a Government reform designed to bridge the gap between financial information and regulated advice.
But the framework applies to FCA-regulated contract-based schemes at the moment and not trust-based schemes such as master trusts regulated by The Pensions Regulator.
According to People’s Pension, this could leave savers with different levels of support depending on the type of scheme their employer has chosen, despite facing the same retirement decisions. It adds that targeted support could help savers identify under-saving, understand retirement income options and assess the risk of their pension running out.
People’s Pension is calling on government to introduce a TPR-supervised targeted support framework for qualifying occupational schemes, giving trust-based savers equivalent support and protections while recognising trustees’ legal and fiduciary responsibilities.
People’s Pension chief commercial officer David Meliveo says: “Targeted support is a fantastic opportunity to help millions of people with their pensions who are never likely to have a traditional financial adviser.
“We cannot end up with a two-tier system where the vast majority workplace pension savers miss out on targeted support simply because their employer chose a Master Trust rather than a Group Personal Pension. People do not think about whether their pension is FCA or TPR regulated when deciding whether they are saving enough, how to generate a retirement income or how to make their money last through their later life. They just want straightforward help to make a better decision
“We want to be able to offer People’s Pension members the same kind of targeted support that contract-based providers are now developing. Government has an opportunity to create a level playing field that allows trust-based schemes to do that safely, so the type of pension someone’s employer chose does not dictate the quality of help they get.”
