Pension complaints leap up by 27% as industry figures question whether consolidation is working
Pensions and decumulation complaints have increased by 27% in 18 months, leading some industry figures to question whether consolidation is working.
The Financial Conduct Authority (FCA) has published its complaints data for the first half of 2024, showing 93,023 pensions and decumulation complaints. This is a seven percent increase compared to the second half of 2023. There were 73,069 pensions and decumulation complaints in the second half of 2023, meaning today’s data shows a 27% leap in the last 18 months.
Ian Bell, head of pensions at consulting firm RSM UK, said: “This increasing trend should be concerning to the Pensions Regulator and the pensions industry as the reasons behind it need to be understood.
“Over the past decade, large insurers’ master trusts have taken on the pensions of thousands of customers from many organisations. But how geared up are they to handle increasing demand for draw down, and who do customers turn to when things go wrong? The increasing trend of complaints demonstrates that escalation procedures clearly aren’t working effectively.”
Bell added: “I anticipate we may see this trend of increasing complaints continuing in the FCA’s H2 2024 data, as more people have recently attempted to draw down their tax-free lump sums, anticipating potential changes to the tax treatment of pensions in the Budget. Some intervention is clearly needed to make sure that the increasing trend is addressed now.”
