The number of deferred pension scheme members who have cashed-in their defined benefit (DB) pots has quadrupled in the last six months when compared to pre-pension freedoms levels.
According to figures from consultant Hymans Robertson, 0.25 per cent of these savers transferred their defined benefit pension in the six months up to April 2015.
In the last six months, up to January 2018, 1 per cent of deferred members exercised this option.
The proportion of individuals requesting quotes in the same period has tripled – from 1.5 per cent to 4.2 per cent, the data showed.
The firm declined to give absolute figures due to commercial confidentiality reasons.
The volume of these transfers has been soaring, as savers seek to take advantage of sky-high transfer values and to move their nest eggs into defined contribution (DC) schemes in order to access their cash.
HM Revenue & Customs data showed more than £14bn has been unlocked from defined contribution pensions since pension freedoms came into effect.
Hymans Robertson released the pension transfer figures today (19 February) in light of the Work & Pensions select committee report on British Steel Pension Scheme (BSPS) case, published last week.
The MPs concluded many steelworkers were "shamelessly bamboozled" by financial advisers, with their pensions ending up in "unsuitable funds characterised by high investment risk, high management charges and punitive exit fees".
According to Ryan Markham, head of member options at Hymans Robertson, the approach taken by the trustees of the British Steel Pension Scheme is similar to the approach many trustees and employers are still taking towards transfers, now that pension freedoms are in force.
He said: "Too many schemes are taking a passive approach to both communicating with and supporting their members with the freedoms.
"Not only does this put members at risk of poor retirement decisions and scams, it also puts trustees and employers at risk of being accused of not providing sufficient information for informed choices to be made."
Around 130,000 steelworkers had to choose to move their defined benefit pension pots to a new plan being created, BSPS II, or stay in the current fund, which would be moved to the Pension Protection Fund (PPF), by 22 December.
Of the total members, 43,000 were deferred, which meant transferring out their pension was also an option for them.
FTAdviser reported in November that several steelworkers appeared to be transferring out their pensions after being lured by cheap deals by unregulated introducer firm Celtic Wealth Management & Financial Planning, which then referred the clients to advice firm Active Wealth.
Since March and until the beginning of February, the scheme has processed 2,600 pension transfers equating to a total value of £1.1bn, according to data revealed by the scheme trustees.
Mr Markham argued that ensuring members make the right choice when making one of the biggest financial decisions of their life is a natural extension of the duties of scheme trustees.
He said: "Members staying or transferring must do so on an informed basis and with access to quality advice."