Defined Benefit  

FCA to review DB transfer redress guidance

When the FCA first published its guidance back in 2017, changes included a revision of the inflation rate to reflect changes to data published by the Bank of England, and the removal of the life-styling element in the pre-retirement discount rate.

These changes meant the value of DB scheme benefits at calculation date could have increased by more than 20 per cent in some cases.

The FCA’s goal was to bring up to date the methodology used for calculating redress, which was originally created to deal with the barrage of complaints from the pension review of the 1990s.

Last month (August 6), the Financial Services Compensation Scheme provided guidance on how it calculates its compensation for DB transfers to help claimants understand the process better.

According to the Financial Times, FTAdviser’s sister publication, the FSCS reviewed its information after savers complained it was unclear and led them to miss out on thousands of pounds in redress.

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