Liberal Democrat MPs have called for the government to legislate for universal free pension advice in an amendment to the Pension Schemes Bill.
The bill will be scrutinised by a parliamentary committee this week, and more than 240 amendments have been proposed for the committee to consider.
Many of these have been put forward by pensions minister Torsten Bell and are mostly minor administrative changes, but Liberal Democrat MP Steve Darling, a member of the Work and Pensions Committee, has put forward several significant additions for the committee to consider.
Among them is a “universal pension advice entitlement”, which would include a legal requirement for “every individual” to receive “free, impartial pension advice” at age 40 and again five years before their retirement date.
The clause says such advice could cover areas such as the type of pensions people have, available investment strategies, relevant charges, consolidation, and the options they have for taking a retirement income.
The proposed regulations, according to the clause, should also cover the qualifications needed for those providing advice, how people are notified about receiving the advice, and what responsibilities are placed on trustees, pension scheme managers, and providers.
Darling has also put forward an addition to the section of the bill that covers defined benefit surplus release rules. His addition would allow a proportion of surplus funds to be used to fund free pension advice.
Darling’s proposals, as well as 14 other amendments he has put forward, were supported by fellow Lib Dem MPs Liz Jarvis and John Milne. Milne is also a member of the Work and Pensions Select Committee.
The advice-related amendments – which the committee may choose to reject – come as the Financial Conduct Authority is working on a “targeted support” regime to allow financial services providers to give guidance to groups of customers as to what kind of products or services might be suitable for them.
A separate amendment, also tabled by Steve Darling, would see communications related to targeted support initiatives exempted from directed marketing rules – something that several trade bodies have called for.
