Pension Wise is delivering double the number of appointments to savers in some areas of the UK but overall take up still remains ‘worryingly’ low, data has revealed.
A Freedom of Information request submitted by Just Group has revealed that in 2019-20 defined contribution pension savers were about twice as likely to take a session in Scotland, the West Midlands and Yorkshire & Humber than they were in Northern Ireland, London or the North East.
According to the data, the number of phone and face to face appointments were highest in Scotland at 11,515, while in Northern Ireland only 1,803 were taken.
Meanwhile Greater London saw 7,465 appointments, compared to 9,897 in the West Midlands.
Just said the figures provide more evidence of the low number of savers using this service, which is there to stop individuals from making poor financial decisions and being targeted by scammers.
Stephen Lowe, group communications director at Just Group, estimated that in the area of highest usage, fewer than one in 33 DC pension savers eligible for a free guidance appointment take it up each year.
In some areas it is more likely to be one in 100.
Mr Lowe said: “The government has affirmed its desire to see use of Pension Wise become ‘the norm’ for everyone who is thinking of accessing their DC pensions.
“These new figures illustrate there is still a long way to go and use of Pension Wise is still very much the exception than the norm.”
He said the ‘softly-softly’ efforts to safeguard DC savers’ outcomes are in sharp contrast to those in the defined benefit transfer market where most scheme members must take regulated financial advice and the government has recently taken action by banning contingent charging.
Mr Lowe added: “For every DB transfer there are about 13 DC pensions accessed for the first time by people who need to understand their options and make informed choices about how to use their retirement funds.
“While DB pots may be larger, DC savings are still valuable to individuals and may make the difference between struggling for income on the State Pension and achieving an acceptable standard of living in retirement.”
It has previously been suggested Pension Wise could start to offer an advice service to ensure that members are not being targeted by scammers and receive an adequate level of advice.
The Association of Member Nominated Trustees suggested this advice service could help those looking to transfer out of their defined benefit pensions, even if the value is less than £30,000.
If the service finds that the member needs more comprehensive help, they would then be passed on to an adviser for full financial advice, the AMNT proposed.
But advisers warned this could cause further confusion as to where the line is drawn between advice and guidance.
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