By David Piltz
To assist members to understand their options, from April 2015 when the new pensions flexibilities are applied to defined-contribution arrangements, the government is implementing a free and impartial guidance guarantee service. The government has just announced that the ‘go to market’ name for the guidance guarantee is ‘Pension Wise’. Pension Wise will initially be provided by the Pensions Advisory Service (TPAS) via the telephone, and various UK branches of the Citizens Advice Bureau (CAB) will provide face-to-face guidance.
It is clearly extremely important that those exercising the new flexibilities from next April make the right choices about what to do with their pension benefits. If large numbers of retirees make decisions that with hindsight turn out to have been poor, this will seriously affect the credibility of the government reforms. To ensure this does not happen, Pension Wise needs to become a strong, recognised and trusted brand whose services are generally taken up by those who are retiring and have to make life-changing decisions. Key to all this is ensuring right from the start that those delivering the guidance both in TPAS and the CAB have enough experience and knowledge about pensions to properly give that guidance. The quality of the conversations that take place both over the telephone and face to face is going to have a big impact on what members decide to do with their benefits. It is particularly important that call handlers are well trained with adequate scripts and the ability to revert to plainer language in appropriate circumstances.
Where then are these givers of guidance to come from? They are likely to be already working in the pensions industry and therefore to be on a reasonable salary, so it’s not going to be easy to recruit the number of advisers needed with the right pensions knowledge. TPAS is currently advertising for assistant technical specialists in London to join its guidance guarantee team, while the CAB is advertising for pension guidance guarantee caseworkers at various locations across England and Wales. This latter job advert says: ‘You’ll provide a specialist, high-quality pensions guidance service to people with complex pension scenarios, providing them with accurate and personalised information and guidance on the choices they face. You’ll help people understand the implications of their financial decisions, ensure they’re aware of the dangers of fraud and scammers and play a key part in our overall cause — to make society fairer.’
It is obvious from the wording of the advert that it will be a tough job to provide the impartial guidance guarantee service. For TPAS and the CAB, the recruitment and retention of the right staff to deliver this cornerstone of the government reforms is itself the first challenge Pension Wise faces. Moreover, the clock is ticking towards the April deadline and time is not on their side.
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