Pensions Advisory Service gets guidance guarantee job

A levy on regulated financial services firms will pay for the Government's pledge of free, impartial retirement guidance, the Treasury confirmed this morning. Independent organisations such as the Pensions Advisory Service and the Money Advice Service look set to be tasked with providing the guidance after being named this morning in a Treasury statement.The Government is today rubber stamping plans first announced in the Budget to revolutionise pensions.Ahead of a more detailed formal announcement later today it said the guaranteed guidance on pensions choices will be provided by independent organisations rather than pensions schemes or providers.{desktop}{/desktop}{mobile}{/mobile}As a consultation on the Budget changes closed, the Treasury said in a statement:"The government wants to ensure that guidance is trusted by consumers, and the vast majority, including most of the financial services industry who responded, said that consumers would not trust guidance given by a person or organisation with a vested interest in selling a financial product or service."It will bring together a range of delivery partners, including the Pensions Advisory Service and the Money Advice Service, which already provide guidance and support to consumers."Guidance will be offered through a broad range of channels, including web-based, phone-based as well as face-to-face, and to remain free to the consumer will be funded by a levy on regulated financial services firms."The government's response to the consultation today also confirmed that:• More people will be able to benefit from the new pensions flexibilities as the government will continue to allow individuals to transfer from private sector defined benefit schemes to defined contribution pension schemes – subject to two important new safeguards• A new override will be introduced so that pensions schemes are able to offer individuals flexible access to their savings and the pensions tax rules will be amended to allow providers to develop new retirement income products that are tailored to the needs of individual consumersPeople with private sector defined benefit savings will continue to be able to transfer to defined contribution schemes (excluding pensions that are already in payment), alongside two new safeguards to protect both pension schemes and the individuals transferring out.Two new safeguards are being introduced to protect both individuals and pension schemes in relation to defined benefit to defined contribution transfers: a new requirement for an individual to take advice from an impartial financial adviser regulated by the FCA before a transfer can be accepted; and, new guidance for trustees on the use of their existing powers to delay transfer payments and take account of scheme funding levels when deciding on transfer values.Chancellor of the Exchequer, George Osborne, said: "I'm pleased that the responses we had to our proposals on making pensions more flexible have been overwhelmingly positive."We're making sure that people have the right support to make their own choice about how best to finance their retirement and I'm pleased to confirm that everyone with defined contribution pension savings reaching pension age will get free and impartial guidance on their range of available choices at retirement."The Financial Conduct Authority has also today published a paper which consults on the elements of the guidance guarantee for which the FCA will be responsible: setting and monitoring the standards with which guidance providers will have to comply, making and enforcing rules on how contract-based schemes signpost to the guidance services, and adjusting the FCA's existing conduct rules to support the introduction of the guidance guarantee and in response to the new flexibilities.

Pensions Advisory Service gets guidance guarantee job

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