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Detail of outcome
This document summarises responses to the pension transfers and early exit charges consultation. It sets out the action and next steps that the government will be taking to address each of the consultation’s areas of focus: excessive early exit charges, pension transfers and the circumstances in which individuals should seek financial advice.
As announced by the Economic Secretary to the Treasury, Harriett Baldwin, the government has also tabled an amendment to the Bank of England and Financial Services Bill (new clause 7) to require the Financial Conduct Authority to make rules prohibiting early charges for those seeking to exercise their rights under the pension freedoms.
The government is seeking responses from both pension specialists and consumers on early exit penalties, the transfer process and how greater clarity can be provided on the circumstances in which individuals should seek financial advice.
In order to ensure that people can access the new pension flexibilities easily, the government is seeking responses to its consultation (from pension specialists) and an online consumer survey (from individual consumers), both of which will be considered alongside evidence gathered separately from providers by the Financial Conduct Authority and The Pensions Regulator.
This consultation will look at options to address excessive charges for early exit penalties, making the process for transferring pensions from one scheme to another quicker and smoother, and how there can be greater clarity around the circumstances in which someone should seek financial advice. The consultation will run for 12 weeks and a response will be published in due course.
The online consumer survey provides a platform for consumers to tell the government about their own experiences and views on these issues. It will run alongside the consultation for 12 weeks and will form part of the government’s response.
Consumers can use this survey to tell us about their experiences and views on early exit penalties, the pension transfer process and the circumstances in which individuals should seek financial advice.