The Department for Work and Pensions has committed to banning pensions cold calls by June this year, bowing to pressure from MPs and peers to bring forward its timetable for taking action.
A new clause in the financial guidance and claims bill, tabled by the government, gives work and pensions secretary Esther McVey the power to introduce regulations against "unsolicited direct marketing relating to pensions".
If the ban has not been introduced by June, McVey would have to explain her decision to parliament.
Another amendment requires schemes to guarantee that a person looking to access their pension savings is “referred to appropriate pensions guidance” and “has either received appropriate pensions guidance or has opted out of receiving such guidance”.
A reference to independent financial advice is removed, in order to encourage clients towards using the independent guidance service. The Financial Conduct Authority’s rules should lay out how individuals can prove that they have received guidance, or alternatively opted out.
The DWP will continuously review the possibility of a cold call ban for financial products other than pensions.
Frank Field, chair of the Work and Pensions Committee, welcomed the government's additions and said the new bill was "within spitting distance" of the committee's recommendations.
"I am delighted that they will be bringing forward a ban on pensions cold-calling by June, as we called for," he said. This represents a major leap forward in the urgent fight to protect pensioners’ savings against scams and sharp practice.
He said the pushing of savers towards expert guidance rather than financial advisers could be strengthened to completely eliminate conflicts of interest.
"I very much welcome this proof of the government’s commitment to listening to the committee and other expert opinion in shaping these vital protections. I look forward to this constructive engagement continuing as the bill proceeds through the House,” he added.
