The UK pensions industry accused of ‘destroying trust’ in pensions
UK pension commentators and the pensions industry in general are helping to ‘destroy trust’ in pensions, according to a scathing response by the chief executive of UK-based retirement advice company Workplace Solutions.
Simon Chrystal, CEO at Workplace Solutions said that as scrutiny intensifies on advisers involved in delivering advice on pension transfers, the industry is presented an unrealistic outcome for investors. He points to, in some cases, reports of transfer values of “sometimes 40 or more times the forecast annual pension income” that members would otherwise receive, as a serious issue for the industry to tackle.
As a result, individuals speaking to advisers start from the premise they are on the right end of a “deal”, when for many people, he says, nothing could be further from the truth.
“A reported £50bn has been transferred from company defined benefit schemes to individuals since the rules changed and greater pension freedoms were introduced by the government in 2015,” said Chrystal. “The vast majority of the people taking these pension transfers have received advice.
‘Riddeled with scandal’
“Of course, there have been some rogue advisers in the sector, unfortunately, as there are in every industry, but to listen to some so-called pension industry experts continually crowing in the media, you would think that the whole sector is riddled with scandal.
“This is simply not a true or a fair representation of the facts.”
Chrystal points that people who take professional financial advice, consider their options carefully and then decide to transfer their pensions, are routinely and slammed in the press by many in the industry as having been misled, misinformed or mis-sold.
“If these industry commentators bothered to drop the ‘we know best because we are the experts’ attitude, they might learn that the regular people we work with are not stupid, have made more good decisions than bad ones in their life, know their values and how they want to live,” he added.
“They want to organise their income in a way that allows them to do the things they did not have time to do when they were working. They understand they have to make hard choices sometimes, they have had a lifetime of such choices.”
Chrystal added that commentators that push their agenda create “constant distrust”, and he accuses such commentators as turning what should be the point in someone’s life when they reward themselves for all their hard work, into “a time of fear and anxiety.”
“With this approach, these commentators are destroying trust in pensions at a time when access to retirement advice is more important than ever,” he said.