The head of pensions at Drewberry Wealth Management has criticised the “unacceptable” amount of time it takes to process a pension transfer.
Neil Adams said he has experienced cases where transferring a client pension from one DC pot to another has taken some five months.
He said: “A turn-around time of greater than a month is unacceptable. The organisations which are not particularly good at providing the initial information tend to be the ones which administer the money purchase arrangements, so the Mercers and JLTs of the world.
“We have had transfers which have taken three months or so. One of our clients has a pension administered by Xerox Benefit Administration and he wants to transfer it away and we started the process in July so that has taken a significant length of time.”
Hargreaves Lansdown has previously raised this issue, with the company’s head of retirement policy Tom McPhail calling for a 30-day time limit.
Meanwhile, the pension freedoms have led to an increase in people looking for an adviser, with SimplyBiz showing an average uptake of up to 10 additional clients for each adviser on its network.
Keeley Paddon, head of pensions technical at SimplyBiz, said: “While this is positive, if we assume this is standard across the industry, then it does not come close to covering the number of consumers who may be affected by pension freedoms.”
A survey of the network’s more than 5,000-strong membership looked at what advisers had deemed the biggest concerns for their clients facing retirement. The study suggested that many were drawing down without advice.
“Given that Pension Wise appointment figures are also low, but that the amount of cash being drawn-down from pension funds stands at £4.7bn and growing, it suggests that many consumers are taking money without taking advice,” she said.
One reason for the lack of advice could be that advisers are refusing to facilitate DB transfers.
Right to reply
A spokesman for Xerox Benefit Administration said: “Buck Consultants at Xerox endeavours to adhere at all times to legislative timeframes in accordance with theOccupational and Personal Pension Schemes Disclosure Regulations and to meet client contractual service level agreements.”
At the time of going to press JLT and Mercer had not responded to our requests to comment on this article.
