Pensions advice promised by George Osborne is a “political banana skin”by Henry Tapper / September 17, 2014 / Leave a comment
Visit the rickety offices of The Pension Advisory Service (TPAS) in Victoria and you’re in for a big surprise.
With only a smidgeon over £3m a year in funding from the Department for Work and Pensions, Michelle Cracknell and her team of 40 full time staff took 80,000 helpline enquiries last year. Together with 400 unpaid but highly qualified volunteers it managed over 2,000 cases brought to them by members of the public bemused and disgruntled by Britain’s complicated pension system.
TPAS, since Cracknell’s arrival as Chief Executive, is working. On the day I visited, every call handler was busy either on a landline or on one of the dedicated terminals talking screen-to-screen via web chat or dealing with the wall of online enquiries.
The people TPAS helps are often those individuals that financial advisors cannot or do not reach. TPAS sees spikes in demand whenever Martin Lewis, the founder of MoneySavingExpert.com, mentions their service and Cracknell points to high user satisfaction surveys as proof of running a highly professional helpline. Cracknell and her team have seen increases in volumes of customers due to the new media attention that has been put on pensions. She says that “this is what we dreamed of, people wanting to talk about pensions.”
But Cracknell admits she’s still playing “lower league football.” From April 2015, she hopes that TPAS will be promoted to the Premier League as it takes on the challenge of up to 300,000 new callers, all of whom will want to discuss what to do with their pension savings. This is down to a promise made by George Osborne in this year’s Budget. Having changed the tax rules so that people no longer needed to buy annuities, the new pension freedoms that have emerged are baffling to a pension buying public. The Office for Fair Trading has expressed concerns over the ability of customers to make good decisions in their choice of pension.
Osborne, anticipating the issue, simultaneously announced the launch of a universal right for those reaching retirement to receive guidance, delivered either over the phone or in a face-to-face meeting.