The Association of British Insurers(ABI) and The National Association of Pension Funds (NAPF) have urged the Government to make some fundamental decisions quickly to ensure that the guidance guarantee, part of the Government’s wide ranging pension reforms announced in the Budget, can be delivered to meet the April 2015 implementation deadline.
In a joint ABI/NAPF letter sent to the Chancellor of the Exchequer, both organisations warn that delivering the guidance guarantee “will be at significant risk” unless decisions are taken by the Government by July on the following:
- Defining what areas the guidance guarantee will cover and who it will be available to.
- Which organisation's will deliver the guidance.
- Who will lead in setting up the service and establishing its standards.
- How the funding framework will work.
Otto Thoresen, ABI’s director general, comments "The guidance guarantee is a crucial part of the Government’s pension reform, and the industry fully supports the Government’s intention to provide free, impartial guidance to savers on their options as from next April. But time is not on our side. No one should under-estimate the work that needs to be done to make this a reality, which is why the Government have some urgent decisions to make. We stand ready to help shape the guidance guarantee to make sure it fits well with current retirement communications and systems and delivers value for money.”
Joanne Segars, chief executive, NAPF, added "The Budget announcement was nearly three months ago and there remains an unnerving lack of detail from the Government about how the ‘guidance guarantee’ will be delivered. It is clear the success of the Government’s reforms will lie in making sure consumers have access to good impartial guidance so they can make the right decisions about their income for retirement. Key to this will be a clear structure and plan for delivery. The consultation does not need to have been completed before the practical delivery of the guidance service can be mapped out and we are calling on the Government to work with us and the small group of stakeholders who will have ultimate responsibility for its delivery, to put this plan in place by the end of July."
Pensions Minister, Steve Webb, told the Financial Times that "the industry is absolutely right to say we need to get a move on" and added that to deliver advice by the deadline, ministers would have to rely on existing services such as the Pensions Advisory Service.
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