Personal Pension  

Each Pension Wise session costs £500

Each Pension Wise session costs £500

Today (17 December) the government has published statistics that reveal that each Pension Wise guidance appointment costs £496.

This figure is down by 0.8 per cent on how much it cost to deliver a Pension Wise session in October 2015 and is more than three times what advisers told Unbiased they typically charge for an hour long session.

Despite soaring regulatory costs and greater demand for advice following pension freedom the latest research from adviser search engine Unbiased showed intermediaries are still charging the same as they did in 2014.

The third annual Cost of Advice guide reveals the average fees charged by financial advisers for common advice scenarios, and confirms that fees are holding steady.

The figures, based on a survey of advisers listed on the Unbiased.co.uk database, show the median hourly rate charged by advisers is £150, unchanged from 2014, a drop of 14 per cent compared to 2013.

According to Unbiased’s analysis the average cost of an initial financial review and report has stuck at £500 for the last three years but the cost of advice on a £200 a month pension contribution has risen from £500 in 2013 and 2014 to £580 this year.

The government’s data showed in total, the amount of completed Pension Wise appointments has hit 40,600.

From the feedback responses from customers, 89 per cent said that they were satisfied with the guidance they received, an increase of 0.23 per cent on October 2015.

Since the website launched, there have been 1.94 million visits and the figure across November was up from October by 6 per cent, said the government.

The cost per website visit is 28p at present.

Figures showing the Pension Wise data will be updated monthly on the government website.

A Treasury spokesperson said: “The government committed to publishing data on the Pension Wise service and as the figures show, with over 40,000 appointments and over 2 million visits to the website since its launch, it’s clear that the service is popular and helpful.

“Pension Wise is unique in offering a free, impartial service either face to face, via telephone or through our website.

“The transaction figure relates to the running costs across all delivery partners - including the website, the marketing costs and the Pension Wise team. We expect this will decrease over time.”

Earlier this month, it was announced that Pension Wise was to be extended.

Pension Wise will be extended to cover the secondary annuity market.

In September this year, the Financial Services Consumer Panel told MPs that the scope of Pension Wise is limited and needs revisiting.

Last month former pensions minister Steve Webb told FTAdviser the money devoted to Pension Wise could have been better spent on an adviser voucher system.

Mr Webb said the free guidance service brought in to assist retirees with the new freedoms open to them from 6 April “has not got the coverage we would have hoped” and in hindsight he wondered whether the money should have instead been spent on some form of “cheap advice” via a voucher system enabling consumers to see an actual IFA.