Personal Pension  

Pension Wise dodges oversight from City regulator

Pension Wise dodges oversight from City regulator

The Treasury has confirmed that complaints about the Pension Wise service will go to the Parliamentary and Health Service Ombudsman rather than a financial regulator.

According to the Treasury, the PHSO, which normally handles complaints relating to government departments and the NHS, will be expected to look into any complaints customers may have about the pension guidance.

The new Pension Wise guidance service will come into force in April for people aged 55 or over who want to access their savings.

Article continues after advert

However, many details about how the complaints system will function appear to be undecided. When asked if customers could claim compensation if financial loss could be proved and what the ultimate sanction would be for guidance providers, the Treasury said this had not been decided yet.

Nor did the Treasury respond when asked how many complaints it was forecasting.

A Treasury spokesman said: “The government is developing a robust complaints handling process that is in line with FCA standards.

“This complaints process will be up and running in good time for April 2015 and will be continually monitored by the FCA.

“If a consumer’s complaint cannot be resolved by the guidance service, they will be able to escalate it to an independent adjudicator, which will be appointed in due course.

“Individuals will also have ultimate recourse to the PHSO.”

Meanwhile, Tony King, the Pensions Ombudsman, has spent 18 years in a number of administration, trusteeship and consulting roles in the pension industry.

Dame Julie Mellor, the PHSO, was corporate human resources director for British Gas and has 20 years’ experience of human resources for the Greater London Council, Shell and TSB.

The Treasury spokesman went on to say that the guidance would not make recommendations on providers or products and it would be up to consumers to make their own financial decisions.

Most complaints relating to financial services currently go to either the Financial Ombudsman or the Pensions Ombudsman.

Philip Stevenson, director of Cheshire-based Ark Financial Planning, said: “When the chancellor stood up in parliament months ago and said everyone would get free guidance, that was just politicising, and the implications and practicalities of it are turning into a nightmare.

“They seem to be making it up on the hoof, and I am not quite sure there is a considered, rational thought process involved in this.”

This article has been changed since publication on 23 January