The Pensions Advisory Service, Pension Wise and the Money Advice service will be merged into a single public body offering debt advice, money and pensions guidance, the Treasury has confirmed.
Ministers have opted for a single advice and guidance body, dropping plans to offer a two body delivery model that would have seen the Money Advice Service (MAS) sit alongside a new streamlined pensions body that merged the Pensions Advisory Service (TPAS) and Pension Wise.
The Government says a single body would be better able to respond to the different financial guidance needs of consumers, making it easier for them to get access to the help they need to make effective financial decisions.
Economic secretary to the Treasury Simon Kirby says: “Our government wants to give ordinary people more control over the lives, and that includes their financial security. We strongly believe that creating one public guidance body is the best way of making it as easy as possible for people to access the help they need to get their financial questions answered”
Minister for pensions Richard Harrington says: “A single guidance body will be more efficient and will help consumers make the right financial decisions, and we are committed to ensuring people can access the best free and impartial financial guidance possible.
“The next steps will involve consulting on the best way to design a single body model, so legislation to create new public financial guidance bodies will not be included in the Pensions Schemes Bill.”
TISA director general David Dalton-Brown says: “We hope that by creating a single unified body the new guidance service will address some of the clear gaps in the service today, such as the need for debt advisers to warn people not to opt out of a workplace pension if it would mean them losing the employer contribution and similarly those advising pensioners should always bring the value of their house into the discussion. We see this as a positive step forward and will help consumers make the right financial decisions.”
Now: Pensions CEO Morten Nilsson says: “In many ways it makes sense to have a single guidance service as in real life people’s finances aren’t compartmentalised. But the danger of rolling all guidance into one is that it becomes a ‘Jack of all trades and a master of none’ which was part of the problem with the Money Advice Service.
“Pensions are complicated and it’s important that the specialist service offered by organisations such as The Pensions Advisory Service isn’t lost. With the freedom and choice reforms, pension savers have many more options to consider when they come up to retirement and face significant consequences if they make the wrong decision.
“This new guidance body will be paid for by a levy on the financial services industry. While we support funding of these organisations in this way, it’s important that government considers and reviews all levies it imposes to ensure they are fair and proportionate as ultimately these costs are passed onto savers.”