Pension experts and campaigners have criticised Financial Conduct Authoritys proposals on the guidance guarantee service, saying more time and tighter regulation is needed than currently proposed.
The FCA published its Retirement reforms and the guidance guarantee consultation in July, taking forward the government's pledge for free and impartial retirement advice. The deadline for submissions was yesterday.
But, the Low Incomes Tax Reform Group, which has campaigned on improving the tax and benefits experience of poor earners, including pensioners, said in its response that the 'watered down pensions guidance service was insufficiently robust'.
The LITRG is calling on the FCA to ensure that the pensions guidance service is strong, 'with much tighter regulation than currently proposed, and that individuals providing a face-to-face service are adequately trained'.
LITRG chair Anthony Thomas said: 'We are very concerned that the short timescale for implementing these changes means that there will be a lack of adequate and fully trained staff to provide this service. Furthermore, consumers may assume that the guidance is actually advice and so not adequately explore their options.
'While it appears that web-based guidance may be freely available, some consumers are digitally excluded and, given the importance of the decision to be taken, many are likely to seek face-to-face appointments. It is not yet clear which organisations are to provide this face-to-face service, but ensuring adequate geographical converge is essential.'
Meanwhile, Kevin LeGrand, head of pensions policy at Buck Consultants, said he was concerned about the 'viability of the current plans' for the guidance guarantee and the proposed timetable for its deployment.
He said: 'In setting the deadline for completion of the guidance guarantee system, account also needs to be taken of the time it will take the pensions industry to produce the necessary documents and systems that will be needed to implement part of the requirement.
'It is vital that such a high-profile service, inseparable from the new DC retirement regime, is deemed a success by its customers from day one.'
LeGrand said if the details could not be settled before the end of 2014, he suggested that a temporary solution should be set up that requires at least one provider to be in place to provide guidance.
At Hargreaves Lansdown, head of pensions research Tom McPhail said that the consultation paper 'raised a number of critical issues around the customer journey' into retirement from 2015 and onwards.
'For too long it has been too easy for investors to be led into buying uncompetitive or inappropriate retirement income solutions. This is a critical area of investor protection and one where right now politics and regulation are not necessarily pulling in the same direction.'
The FCA document is intended to be read in conjunction with the government's formal response to its March consultation on pensions reforms, Freedom and choice in pensions.
