The Association of British Insurers (ABI) and the National Association of Pension Funds (NAPF) have written to the government urging it to make some quick decisions to ensure its financial guidance guarantee, part of the pension reforms announced in this year’s Budget, can be delivered in time to meet the April 2015 implementation deadline.
The letter warned that delivering the guidance guarantee ‘will be a significant risk’ unless decisions are taken by the government by July 2014 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 (pictured), director general of the ABI, said: “The guidance guarantee is a crucial part of the government’s pension reforms, and the industry fully supports the government’s intention to provide free, impartial guidance to savers on their options 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 has 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 of the 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 which will have ultimate responsibility for its delivery, to put this plan in place by the end of July.”