A third of advisers would like to see the size of the advice allowance increased, whereas about a fifth want it to be scrapped altogether, FTAdviser has found.
A poll by FTAdviser, carried out last week (June 16), found of 66 respondents 22 would like to see the allowance increased (33 per cent), while 19 (29 per cent) would prefer to see it integrated with adviser charging.
Adviser charging is permitted by the Financial Conduct Authority as a way for paying for advice from pensions and other savings products.
The rules operate slightly differently to the pensions advice allowance. For example, there is no limit on each transaction as long as it is to pay for a personal recommendation given by the adviser on the product that it is being paid from.
The advice allowance on the other hand, which came into being in April 2017 following a recommendation in the Financial Advice Market Review, allows pension scheme members to withdraw £500 a year tax-free, up to three times in their life, to pay for financial advice.
However, uptake has been low with few providers offering this service to clients.
FTAdviser found that 11 per cent of respondents believed providers should be forced to offer the allowance and 9 per cent said it needed to be better promoted.
This compared to 18 per cent who said the allowance should be scrapped altogether.
It comes after MPs were told last week (June 16) that increasing the allowance would not be beneficial to most savers due to supply issues with advisers.
Appearing in front of the Work and Pensions Committee, Chris Brooks, head of policy at AgeUK, said the advice allowance was more beneficial to people who have higher value pension pots and who are more likely to consider paying for advice and are aware of financial advisers.
But Renny Biggins, head of retirement at The Investing and Saving Alliance (Tisa), said he was not against a review of the advice allowance as it had “not been given a fair chance” because a lot of people do not even know it exists.
In a hearing in January, pension minister Guy Opperman said the government should be looking into whether the allowance was “sufficient” to improve retirement outcomes.
Opperman noted there was “no question” the advice allowance had helped consumers, but said the amount available was “too low to be getting an efficacious outcome for the individual”.
amy.austin@ft.com
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