The Society of Pension Professionals (SPP) have responded to the latest FCA consultation, “Supporting consumers’ pensions and investment decisions: proposals for targeted support”.
Although supportive of the concept of “Targeted Support”, the SPP’s comprehensive response highlights numerous areas where the proposals could be improved.
For example, SPP state that their members prefer the term “better position” rather than “better outcome” because it better describes what targeted support is designed to achieve, is easier to measure and reduces the potential for confusion with terminology already in place under the FCA’s Consumer Duty.
The response also states, “In some areas, the current proposals will restrict the level of support that could be made available to consumers and could therefore be detrimental to consumers. For example, in relation to decumulation and annuities.”
The SPP have also taken issue with the proposal to exclude pension pot consolidation from targeted support, explaining;
“It is not clear to the SPP why a recommendation to consolidate into or out of a particular product for the purpose of pension consolidation should be excluded from targeted support. In both the accumulation and decumulation phases, consolidation may be an integral piece of any suggestion to achieve a better outcome, the proposals to exclude targeted support in relation to consolidation also appear to be inconsistent with wider policy objectives to promote consolidation and encourage members to seek better value for money.”
The SPP submission also details some tangible barriers to targeted support e.g. around direct marketing rules and also urges the FCA to, “… make a clear differentiation between existing authorised firms seeking to add targeted support to their permission, and firms seeking new authorisation to be able to offer targeted support.”
Amanda Cooke, Chair, SPP Financial Services Regulation Committee, said:
“The SPP supports the concept of targeted support and is keen to ensure these proposals deliver for consumers. That’s why we’ve highlighted areas of concern, likely barriers to success and a range of suggested improvements.
We look forward to continuing to work with the FCA in a spirit of collaboration to make targeted support the best it can be.”
Amanda Cooke, Chair of the SPP Financial Services Regulation Committee
