Committee's recommendations incorporated in Bill

• Inquiry: Pension freedom and choice
• Work and Pensions Committee

Pensions cold calling ban

The Government's New Clause 3 makes provision for a ban on pensions cold calling to be put in place by June. The proposal aligns with the Committee's recommended amendment on pension cold calls in its Protecting Pensions Against Scams report.

Pensions guidance

The Government has also tabled amendments to clause 19 of the Bill on the provision of pension guidance:

Amendment 13 requires pension schemes to ensure that an individual seeking to access pension savings is "referred to appropriate pensions guidance” and “has either received appropriate pensions guidance or has opted out of receiving such guidance". This echoes the Committee's recommendation that individuals, subject to appropriate exceptions, be required to receive or expressly refuse independent guidance before being granted access to their pension pot.

Amendments 13 and 14 remove the reference to independent financial advice, in order to ensure that clients are to be directed towards the independent guidance service. The explanatory statement to these amendments indicates the Government's intention that this guidance will be provided by the new Single Financial Guidance Body.

Amendment 15 makes clear that the FCA's rules should make provision about how individuals are to indicate that they have received guidance or expressly opted out.

Chair's comments

Rt Hon Frank Field MP said:

"The Government is now almost there, within spitting distance of what the Committee proposed. I am delighted that they will be bringing forward a ban on pensions cold calling by June, as we called for. This represents a major leap forward in the urgent fight to protect pensioners' savings against scams and sharp practice.

On pension guidance, the Government has moved much closer to the Committee's aspiration that the taking of independent expert guidance should be the default course of action when accessing a pension pot.

The Government can now give even greater reassurance by explicitly specifying on the face of the Bill, rather than in an explanatory memo, that the public guidance body will be the sole source of the “appropriate pensions guidance”. Guidance must come from independent and impartial experts, rather than from self-interested pension providers, if individuals are to make the best use of their savings.

I very much welcome this proof of the Government's commitment to listening to the Committee and other expert opinion in shaping these vital protections. I look forward to this constructive engagement continuing as the Bill proceeds through the House."

All the details of this inquiry, including the report Protecting Pensions Against Scams and the Government's response, and further correspondence between Committee Chair Frank Field and John Glen and Guy Opperman, are available on the Pension freedom and choice inquiry page. 

Further information

• About Parliament: Select committees
• Visiting Parliament: Watch committees

Image: Creative Commons