MPS TO SCRUTINIZE ADVISER VALUE AND IMPARTIALITY IN PENSIONS PROBE - Soul 2 Soul Mates Blog

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8/03/2018

MPS TO SCRUTINIZE ADVISER VALUE AND IMPARTIALITY IN PENSIONS PROBE


MPS TO SCRUTINIZE ADVISER VALUE AND IMPARTIALITY IN PENSIONS PROBE

The Work and Pensions Committee has launched an inquiry to find out whether financial advisers offer clients good value and an impartial service.

The probe will examine whether individuals get value for money for their pension savings and receive good value and impartial service from financial advisers.

It will also try to understand what savers are being charged and why, as well as the short- and long-term impact of costs on retirement outcomes.
More broadly the inquiry will focus on whether the pensions industry provides sufficient transparency around charges, investment strategy and performance to consumers.

The committee will also look into whether scheme members can see how their money is being invested and how their investments are performing, and if they are engaged enough to use information to make informed choices about their pension savings.

The submission deadline for feedback is 3 September 2018.

Committee Influence
The Work and Pensions Committee has previously proposed advisers should be banned from charging clients on a contingent fee basis for defined benefit (DB) transfers. It argued using a contingent model creates inherent conflicts of interest.

It also suggested the Financial Conduct Authority (FCA) should drop the proposals it made in June 2017 to remove the starting assumption that a transfer out of a DB scheme would not be in the best interest of the client. Additionally, it proposed the Financial Services register should be made easier to use.

Since these suggestions, the FCA has u-turned on its proposal to drop the starting assumption, and is in the process of creating a more consumer friendly directory to sit alongside the register, as well as improving the register itself.

In March the FCA revealed it is considering whether to implement and ban on contingent charging for pension transfer advice.

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