Pensions: Draw-down Charges

Lord McFall of Alcluith Excerpts

Tuesday 9th June 2015 Lords Chamber

[Lord Freud]

My Lords, noble Lords will be pleased to know that a great deal of effort has gone into making sure that this reform works. In particular, we introduced guidance in the shape of Pension Wise. We are working with the industry and monitoring what is happening. As I said, we will be prepared to go in and put caps on charges and address the issue of transparency if that is thought to be necessary.

[Lord McFall of Alcluith (Lab)]

My Lords, complexity and inertia still define the characteristics of this industry. The Government said that they would not hesitate to intervene if there is a rip-off, but rip-offs take place daily at the moment. In the absence of the Government’s will to go one step further, is there not a compelling case to ensure that the cash element is disclosed in these documents, so that people can see exactly what they are being charged on a monthly or yearly basis?

[Lord Freud]

That is one of the things that we will look at very closely. Clearly, we need to get evidence of how this particular part of the market develops. We already have transparency in the accumulation phase. If that is necessary in the decumulation phase, we will not hesitate to introduce it.