Firms accused by minister
Altmann blames providers for Pension Wise flop
Since the relaxation of rules around pensions in April, the Government’s guidance service has struggled to make an impression amid claims that the public are not being served with appropriate information about their choices.
In an interview with Money Marketing, Ms Altmann accused providers of diverting customers to in-house services.
Pension Wise was meant to be the brake that stopped consumers making rash decisions with their newfound freedom.
But seven months on, low take-up of the free 45-minute appointments and the controversial redeployment of staff, has dented the guidance service, said the trade journal.
Only around one in 10 people who have accessed their pots since April took up the offer of an appointment.
Altmann admitted take-up has been muted, but she says providers are to blame for not living up to the spirit of the rules on signposting to guidance.
She said: “Providers need to step up to the plate and do better. I’ve seen wake-up letters, including from companies that I previously considered to be very good ones, and I’ve struggled to find the Pension Wise name and phone number.
“In one case I saw a three-page letter that says ‘this is the value of your pension fund, now you need to decide what to do’. It says ‘giving this letter does not constitute financial advice but you can call our helpline to talk to somebody’.
“The implication is clearly the letter isn’t financial advice but if you call up the provider’s helpline it is – it’s the way it’s phrased. Once you’ve read through the letter you’ve had the provider’s number six times. The Pension Wise number is at the end but you already think by phoning the people at the nice company you’ve had your advice, so why would you go somewhere else?
“”’m concerned the providers are driving too many people to their own in-house services.”
Providers rejected the claims. Yvonne Braun of the Association of British Insurers, said: “Providers remain committed to signposting customers to Pension Wise. The low initial take-up of the service reflects the fact that it needs much more promotion. It was not helped that it was launched in the run-up to the general election.
“Even though crucial details, such as how the guidance sessions would work and the telephone number had not been agreed six weeks prior to its launch, providers had already agreed a standardised communication for promoting the service. What is now important is Government and providers work together to ensure people make maximum use of the service.”