On the go: Defined benefit transfer activity increased throughout June for the third month in a row, according to research from XPS Pensions Group.
The pension consultancy’s Transfer Activity Index showed an annualised rate of 75 out of every 10,000 members transferring their pensions, the highest level seen since July 2020. The numbers have been rising through April and May, when the rate stood at 55 members and 63 members, respectively.
However, there was a very small fall in transfer values, reflecting, XPS said, a continued period of stability in the financial markets. Data from the consultancy showed the transfer value fell to £248,000 for a typical pension scheme member in June, from £251,000 in May.
The Scams Red Flag Index fell in June but remains at a very high level, with 55 per cent of transfers (down from 61 per cent in May) showing at least one warning sign of a potential scam or the potential for poor member outcomes, stated XPS.
On July 6, the government published its response to the Work and Pensions Committee’s report on the first phase of its inquiry, 'Protecting pension savers – five years on from the pension freedoms'.
In it the government rejected the committee’s recommendation that the upcoming online safety bill should do more to tackle online advertising of fraudulent pension products.
Mark Barlow, head of member options at XPS Pensions Group, said: “We have seen fewer transfers and retirements over the past twelve months, so it’s no surprise that we are now seeing an increase in activity as lockdown restrictions are eased.”
He added: “Whilst scam warning signs remain so high, and with no immediate prospect of laws combating fraudulent online pensions adverts being strengthened, it's as important as ever that trustees and employers take steps to support and protect their members.”
