Pension holders being left frustrated by archaic processes, says Which?
One in four Which? members described the process of accessing their pension pot as slower than expected.
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Your support makes all the difference.Some pension providers need to ditch antiquated methods that appear to be firmly rooted in the last century, according to Which?
The consumer group claimed that some providers are not ready for the digital age.
Long delays were a common theme from a survey of more than 2,100 of its members who had accessed one or more of their pension pots in the last two years.
One in four (25%) described the process as slower than expected.
Which? also found that just over one in six (17%) had to take the step of transferring their pot to another company in order to achieve their preferred method of access.
Our pensions survey paints a picture of archaic providers that are rooted firmly in the last century and seemingly unwilling to modernise
The consumer group said in June the Pensions Regulator had found that more than half (51%) of DC (defined contribution) schemes continue to hold at least some member records non-electronically.
It also pointed to Financial Ombudsman Service (FOS) figures, showing complaints about pensions have nearly doubled since 2014/15.
Of the 7,608 complaints received by the FOS in 2021/22, many involve administration issues, poor customer service or people being given wrong or incomplete information about a pension, Which? said.
A new consumer duty is set to come into force in July 2023 for providers regulated by the Financial Conduct Authority (FCA), requiring companies to give helpful and accessible customer support, and to make it as easy to switch or cancel products as it was to take them out in the first place.
Plans have been in the pipeline for some years to launch “pensions dashboards”, eventually enabling people to see all their pension pots in one place online.
Which? said the Government should ensure dashboards are launched without unnecessary delay and providers should prepare by getting their data and processes in order quickly.
Sam Richardson, deputy editor of Which? Money, said: “Our pensions survey paints a picture of archaic providers that are rooted firmly in the last century and seemingly unwilling to modernise.
“The introduction of pensions dashboards could solve a lot of these problems for savers, so sections of the pensions industry must stop dragging their feet and let the government launch dashboards without delay.
“The regulator should also keep a close eye on pension providers to make sure their customer service is meeting improved standards.”
Phil Brown, director of policy at B&CE, provider of the People’s Pension, said: “The pensions dashboards are a great innovation, with the capability to connect millions of people with all of their pensions and could solve the issue of lost pots.
“However, it’s vital that when the dashboards launch to the public, consumers are able to compare the value for money of various schemes.”
A spokesperson for the Association of British Insurers (ABI) said: “Pension providers are committed to ensuring that customers can access their pension pots as quickly as possible and with minimum fuss.
“This underpinned the sector’s support for the introduction of pension freedoms. It is of course important that customers have the right information and support to enable them to make the right pension choices at such a crucial point in their lives.
“The insurance industry has been at the forefront of developing the pensions dashboards programme and is currently working to deliver this once in a generation innovation. Dashboards will make pensions more accessible to the public and integrated with their financial life and needs.”
A Department for Work and Pensions spokesperson said: “Pensions dashboards will bring pensions into the digital age and revolutionise how savers of all ages access their pension information – allowing them to see what they have in their various pensions at the touch of a smartphone screen, at any time they choose.
“The building and initial testing of the digital dashboards architecture is already well under way and our message to the trustees and managers of pension schemes of all types and sizes is simple: get data-ready.”