The Pensions Ombudsman will take into account temporary guidance on delaying defined benefit transfers when dealing with complaints about delays caused by coronavirus.
The Pensions Regulator today (April 3) updated its guidance in relation to the impact of coronavirus to alert advisers and schemes that the Pensions Ombudsman has confirmed it will take into account the latest guidance if it receives complaints about delays.
The Ombudsman stated: “Given the additional pressures we are all facing, we will be flexible in our approach to existing pension complaints, whenever possible.
“We will continue to take into account the latest guidance from The Pensions Regulator to allow for the possible effects that the current crisis is having on our stakeholders and customers.”
Last week the regulator published guidance allowing DB schemes to delay member requests to transfer out by up to three months.
This was to give trustees more time to calculate cash equivalent transfer values (CETVs) as due to falling markets caused by the coronavirus pandemic, it is now more difficult for them to determine the underlying value of pension funds.
The Pensions Ombudsman is currently only dealing with existing complaints and will only process new complaints when it returns to its full service.
Any post or emails will have to be re-submitted at a later date but the Ombudsman is looking to extend its three-year limit on bringing complaints.
The Ombudsman stated: “We would like to reassure you that, wherever possible, we will be using our discretion to expand our time limit of three years for those new applicants affected by this period of restricted service.”
The TPR has also updated its guidance to warn pension trustees to be vigilant and ensure members are not rushed into financial decisions or are at risk from pension scams.
Due to instability of their employer or the financial markets, savers may look to transfer their pension which means they could be targeted more easily by scammers attempting to lure them to ‘safe havens’.
The TPR has told trustees that if a saver asks about transferring their pension they should urge them to exercise extreme caution and visit ScamSmart which has specific guidance relating to Covid-19.
Trustees should also signpost their members to the Money and Pensions Service – particularly those approaching retirement and whose pensions may have been affected by the current economic conditions.
However David Fairs, executive director of regulatory policy, analysis and advice at TPR, told Steven Taylor, partner at LCP, that schemes were reporting a range of experiences regarding transfers, with some schemes seeing low levels of interest in transferring but others experiencing a high level of requests for quotes.
In a blog post published this week (April 1), Mr Fairs said: “We are calling on scheme trustees to ensure they follow the right process if asked to make a transfer, ensuring people take the right advice from an FCA-regulated adviser.