31st July 2015
The government has called on the public to give their views on pension exit fees and pension transfers.
The Treasury has published a consultation into whether it should cap exit fees that are charged when someone switches out of their pension or transfers to a new pension.
Theses fees have been a bug-bear of consumers for a number of years but the issue has come to the fore following the introduction of pension freedom that let those aged 55 and over take their pension as cash. Many retirees who want to move out of their pension to take advantage of the freedoms have found themselves facing exit charges.
The consultation aims to tackle ‘excessive or disproportionate’ charges and sets out three options: a cap on exit fees set by the Treasury, a flexible cap that would enable insurers to waive the fee for small pension pots, and a voluntary cap that would be introduced by the pension industry.
As part of the consultation an online survey has been launched for consumers and the government is asking retirees to give their views and experiences on exiting or transferring pensions.
This morning, pensions minister Ros Altmann tweeted the link to the survey, which can be found here: https://www.surveymonkey.com/r/J3XV3KX
She said: ‘We want to hear your views and experiences of the new pension freedoms. Please us our survey [and] tell us.’
The survey runs through a number of questions about whether consumers had tried to access their pension before or after pension freedom came into force on 6 April and whether they had ‘difficulty transferring your pension for a reason other than the requirement to seek independent financial advice?’.
The questionnaire also asks whether retirees ‘believe that you were charge an exit penalty when leaving your pension? If so, please include as much information as possible – including any reason given by your provider for it’.
It also asks consumers what they think an excessive fee is for exiting a pension.