Citizens Advice: Guidance guarantee not a one-off event
Gillian Guy told MPs at a Treasury committee hearing on Wednesday it would “not be satisfactory” for the government’s guarantee of free impartial guidance at the point of retirement to be “for people to just go an get some advice”.
“We don’t think guidance happens at one moment under the guidance guarantee, it has to happen much earlier and also carry on after the event so people don’t feel they have been abandoned to their choice,” she said.
“We’d want to get in as quickly as we can.”
Recognising the “massive risks at hand” which stem from the Chancellor’s opening up of the retirement market, Guy said it was imperative the guarantee was delivered by an independent organisation.
The government has already pointed to the Money Advice Service and The Pension Advisory Service as guidance deliverers.
Guy said the Citizens Advice Bureau would be also capable of doing the job, although it would need to stock up on resources first.
Earlier in August it emerged the organisation has revived its joint pro bono advice scheme with the Personal Finance Society (PFS) and plans to roll out the free service across 100 of the organisation’s branches with the “capacity to expand further”.
“There is a logistical issue that we need to get sorted very quickly as to who is going to be providing what under the guidance guarantee so that we can gear ourselves up. We ought to be piloting from next month I would say.”
She added her organisation is well versed in making clear to consumers the difference between guidance and advice.
Labour MP for Erith and Thamesmead Teresa Pearce said she was concerned consumer detriment would be even bigger if a new misselling scandal develops on the back of the pension reforms and auto enrolment, as it would “put people off the whole idea of saving and pensions”.
Guy said: “There is a real role for whoever does give this guidance guarantee to be vigilant about the products that are coming forward because they will be the eyes and ears on the ground. And we need to be putting pressure on the regulator to ensure that is taken account of.”