Providers should curb poor decisions says Pensions Minister

Steven Cameron, Regulatory Strategy Director at Aegon, commented:

“We welcome the pension flexibilities and don’t want to see a situation whereby providers challenge people who have made up their mind on how to take their income after careful thought having used the Pension Wise service or seen an adviser."

He added:

“A careful balancing act is required as we want people to make confident, informed decisions and excessive ‘checking’ could undermine this objective. However, pension providers can potentially help as a final checkpoint to ensure people understand their decision. Rather than challenging them or asking intrusive questions, we should ensure people know what their decision entails."

“For example, if someone wants to take all their pension as cash, we might say, ‘You’ve asked to take your full fund in cash. It’s important you think about your ongoing income needs and the fact that average life expectancy for a 65 year old today is around 20 years.’ This is hopefully a constructive approach.

“There’s a lot of loose talk about ‘second lines of defence’. We need to make sure the customer isn’t left thinking we’re trying to defend against them getting access to their money.”