Last ditch call for reform of financial advice

Royal London is calling on policymakers to introduce urgent reforms to the financial market before the April 2015 changes take effect, to ensure consumers do not buy detrimental products.

With just 62 days remaining, the Government’s reforms risk massive consumer detriment unless steps are taken to secure much greater access to financial advice, the provider has warned. It argues much greater access to advice is critical for consumers to make informed decisions about their retirement provision.

The Pension Schemes Bill is entering the Report Stage in the House of Lords today.

Royal London CEO Phil Loney says: ”As the Pension Schemes Bill nears the end of its Parliamentary process, the Government is running out of time to implement critical reforms to strengthen its proposals. Pensions minister Steve Webb and the Financial Conduct Authority have previously indicated their support for introducing a more affordable advice model, but as the clock ticks down toward implementation, we have yet to see any real action. Yesterday’s announcement by FCA that they will give customers “Additional Protection” by requiring pension providers to give some clear and direct warnings about the consequences of their actions is welcome but it doesn’t do anything to increase the supply of affordable advice.

“We are calling on peers to take steps to strengthen the Bill and clearly point out the importance of impartial advice. Otherwise significant numbers of consumers will end up making complex decisions without access to the financial advice they need to make the right choices with their pensions. The risk of consumer detriment is huge. The Government has just 62 days left. We urge them to act now, make these critical changes and protect consumers.”