How time flies. In print and on the iPad, Monday saw the 45th edition of the relaunched Pensions Expert, and the last of the year.
We’ll be continuing to publish online before our print return in January, so if you have not already registered, make sure you sign up to our free email briefings by heading to pensions-expert.com.
It has been a ridiculously busy year for pensions, and commentators could take their pick of subjects to write on – the March Budget, cripplingly low gilt yields, auto-enrolment bringing 5m new savers into workplace pensions.
But I would like to focus on the Financial Conduct Authority’s long-awaited reports into the annuities market, which ended up with the organisation being accused by Barnett Waddingham’s Malcolm McLean of “sweeping past mis-selling under the carpet”.
Anything short of compensation would have been criticised by some consumer rights groups, but the FCA’s piecemeal action was a disappointment for anyone hoping for a solution to this broken market.
Illustration by Ben Jennings
There is a direct and obvious incentive against annuity providers encouraging people to shop around. Some of the practices uncovered by the watchdog, which have been previously reported in the personal finance media, were both unsurprising and depressing.
This was an opportunity for the powers that be to put in place real protection for consumers – to come down on those with the worst practices in the same way the regulator has raked over the banking sector. But the regulatory will, or perhaps the political will, is not yet there.
It could be that the battering taken by the annuities market after the March Budget, or the prospect of a portion of their would-be customers disappearing in April, earned providers a reprieve.
While there were some good ideas in the FCA’s work, such as giving people a better view of their various retirement pots, it is hard to imagine it will change the central problem of this market.
This publication has been reporting on calls for deeper reform to the annuities market for the entirety of this century so far, and it looks like we’ll be following it for a while yet.
Ian Smith is editor of Pensions Expert. You can follow him on Twitter @iankmsmith and the team @pensions_expert.
