Pensions Advice

Baroness Drake Excerpts

Wednesday 23rd July 2014 Lords Chamber

[Lord Newby]

My Lords, being married to a vicar, I could not possibly say that vicars are not always good sources of advice. The key challenge raised by the Question is that for many people pensions are a subject of complete bemusement. This reform, which I believe is very welcome, will give people much more choice over how they spend their money in retirement. However, they will be able to spend it wisely only if they are given proper guidance, and that is what the Government are committed to ensuring.

[Baroness Drake (Lab)]

My Lords, guidance to help people make choices about how to spend their pension funds is of course to be welcomed, but given that the Government expect the industry to respond to greater choice by providing new retirement income products, how will they ensure that these new products meet the interests of savers in terms of quality standards, transparency and level of charges, so avoiding new manifestations of consumer detriment occurring yet again in the pensions and investment industry?

[Lord Newby]

My Lords, this is why we have set up a new framework for regulation and why we established the Financial Conduct Authority. We have given the authority much greater powers than the FSA had to deal explicitly with these problems. We have to be sure that the new products which are coming forward meet the standards that the noble Baroness wishes to see. The FCA is tasked with that job and is absolutely determined to avoid the problems of mis-selling that we have seen in the past.