Unable to transfer my DB pension - can anyone help?

eskbanker

Linton said:

Barring all DB pension transfers would not be sensible as there are some cases such as seriously reduced life expectancy where it is clearly in the person's best interest.  One could include cases such as when the pensioner does not need the income and the pension scheme would benefit from reducing its liabilities.

So the problem is how do you implement a process where the justifiable more extreme cases are separated from those that aren't.  Either it's a government department that make the decision, or someone else.  In theory the pension trustees should be able act in a pensioner's best interests but they probably dont want the responsibility and dont have the time or training to assess the situation nor the ability to take on legal challenges.

Perhaps the government could find a private sector solution and impose sufficient constraints to ensure that the freedom is limited to those relatively few extreme cases.

Isn't that effectively what there already is, i.e. the pension transfer specialists within the (I)FA community?  The combination of legislation, regulation and provider policies has resulted in the de facto position where advisers effectively already are the ones separating the justifiable cases from those that aren't, even though this obviously wasn't how it was meant to work!

[Deleted User]

eskbanker said:

Linton said:

Barring all DB pension transfers would not be sensible as there are some cases such as seriously reduced life expectancy where it is clearly in the person's best interest.  One could include cases such as when the pensioner does not need the income and the pension scheme would benefit from reducing its liabilities.

So the problem is how do you implement a process where the justifiable more extreme cases are separated from those that aren't.  Either it's a government department that make the decision, or someone else.  In theory the pension trustees should be able act in a pensioner's best interests but they probably dont want the responsibility and dont have the time or training to assess the situation nor the ability to take on legal challenges.

Perhaps the government could find a private sector solution and impose sufficient constraints to ensure that the freedom is limited to those relatively few extreme cases.

Isn't that effectively what there already is, i.e. the pension transfer specialists within the (I)FA community?  The combination of legislation, regulation and provider policies has resulted in the de facto position where advisers effectively already are the ones separating the justifiable cases from those that aren't, even though this obviously wasn't how it was meant to work!

IFAs have been subject to many flattering and unflattering comparisons but this, as far as I know, is the first justification for them playing God with people’s pensions,

eskbanker

ZingPowZing said:

eskbanker said:

Linton said:

Barring all DB pension transfers would not be sensible as there are some cases such as seriously reduced life expectancy where it is clearly in the person's best interest.  One could include cases such as when the pensioner does not need the income and the pension scheme would benefit from reducing its liabilities.

So the problem is how do you implement a process where the justifiable more extreme cases are separated from those that aren't.  Either it's a government department that make the decision, or someone else.  In theory the pension trustees should be able act in a pensioner's best interests but they probably dont want the responsibility and dont have the time or training to assess the situation nor the ability to take on legal challenges.

Perhaps the government could find a private sector solution and impose sufficient constraints to ensure that the freedom is limited to those relatively few extreme cases.

Isn't that effectively what there already is, i.e. the pension transfer specialists within the (I)FA community?  The combination of legislation, regulation and provider policies has resulted in the de facto position where advisers effectively already are the ones separating the justifiable cases from those that aren't, even though this obviously wasn't how it was meant to work!

IFAs have been subject to many flattering and unflattering comparisons but this, as far as I know, is the first justification for them playing God with people’s pensions,

I'm not justifying anything, just highlighting that the mechanism that Linton was proposing isn't massively different from where we already are, flawed though that is....

Pablo7474

dunstonh said:

 You can still use a SSAS potentially

Having read forums and spoken with people I can’t see many being confident enough to set a SSAS up! I think the number of people looking to take DB advice is going to drop significantly! 

Marcon

Linton said:

random129 said:

Prism said:

ZingPowZing said:

We digress. The principle of pension freedom is that the final determination belongs to the client. 

Agreed but how do you force private company platforms to accept the transfers.

The FCA and the government need to step in. Banning ALL DB pension transfers, although that's not what I want, would at least make the situation clear and prevent people wasting money on advice in the expectation they will ultimately be able to transfer regardless of the advice. There is still massive amounts of misinformation out there. A better solution, if it's not possible to compel fund managers to accept insistent clients, would be to set up a government owned fund that would accept all clients who have taken the legally required advice.

Barring all DB pension transfers would not be sensible as there are some cases such as seriously reduced life expectancy where it is clearly in the person's best interest.  One could include cases such as when the pensioner does not need the income and the pension scheme would benefit from reducing its liabilities.

So the problem is how do you implement a process where the justifiable more extreme cases are separated from those that aren't.  Either it's a government department that make the decision, or someone else.  In theory the pension trustees should be able act in a pensioner's best interests but they probably dont want the responsibility and dont have the time or training to assess the situation nor the ability to take on legal challenges.

So you're suggesting that pension scheme trustees should effectively be giving financial advice by deciding whether or not a transfer should proceed...? It's a criminal offence for someone to purport to give regulated advice if they are not regulated/do not hold the necessary permissions.

Trustees already have some responsibility for checking that the scheme to which the transfer is being made is a bona fide scheme, and you don't have to look far to see the fuss which results when they (or more likely the scheme's administrators) identify a dubious destination scheme and refuse to make the transfer. Their hand will be strengthened if the latest DWP proposals (currently under consultation) are adopted, as expected. In particular, it will make it very much more difficult to transfer to a dodgy SSAS - in most cases impossible, where the so-called SSAS is nothing but a receiving vehicle for the transfer.

The problem isn't DB transfers and never has been. It is the introduction of 'flexible access' to benefits that has created the current situation. 

Linton

eskbanker said:

Linton said:

Barring all DB pension transfers would not be sensible as there are some cases such as seriously reduced life expectancy where it is clearly in the person's best interest.  One could include cases such as when the pensioner does not need the income and the pension scheme would benefit from reducing its liabilities.

So the problem is how do you implement a process where the justifiable more extreme cases are separated from those that aren't.  Either it's a government department that make the decision, or someone else.  In theory the pension trustees should be able act in a pensioner's best interests but they probably dont want the responsibility and dont have the time or training to assess the situation nor the ability to take on legal challenges.

Perhaps the government could find a private sector solution and impose sufficient constraints to ensure that the freedom is limited to those relatively few extreme cases.

Isn't that effectively what there already is, i.e. the pension transfer specialists within the (I)FA community?  The combination of legislation, regulation and provider policies has resulted in the de facto position where advisers effectively already are the ones separating the justifiable cases from those that aren't, even though this obviously wasn't how it was meant to work!

Exactly - an attempt at irony.

Linton

Marcon said:

Linton said:

random129 said:

Prism said:

ZingPowZing said:

We digress. The principle of pension freedom is that the final determination belongs to the client. 

Agreed but how do you force private company platforms to accept the transfers.

The FCA and the government need to step in. Banning ALL DB pension transfers, although that's not what I want, would at least make the situation clear and prevent people wasting money on advice in the expectation they will ultimately be able to transfer regardless of the advice. There is still massive amounts of misinformation out there. A better solution, if it's not possible to compel fund managers to accept insistent clients, would be to set up a government owned fund that would accept all clients who have taken the legally required advice.

Barring all DB pension transfers would not be sensible as there are some cases such as seriously reduced life expectancy where it is clearly in the person's best interest.  One could include cases such as when the pensioner does not need the income and the pension scheme would benefit from reducing its liabilities.

So the problem is how do you implement a process where the justifiable more extreme cases are separated from those that aren't.  Either it's a government department that make the decision, or someone else.  In theory the pension trustees should be able act in a pensioner's best interests but they probably dont want the responsibility and dont have the time or training to assess the situation nor the ability to take on legal challenges.

So you're suggesting that pension scheme trustees should effectively be giving financial advice by deciding whether or not a transfer should proceed...? It's a criminal offence for someone to purport to give regulated advice if they are not regulated/do not hold the necessary permissions.

Trustees already have some responsibility for checking that the scheme to which the transfer is being made is a bona fide scheme, and you don't have to look far to see the fuss which results when they (or more likely the scheme's administrators) identify a dubious destination scheme and refuse to make the transfer. Their hand will be strengthened if the latest DWP proposals (currently under consultation) are adopted, as expected. In particular, it will make it very much more difficult to transfer to a dodgy SSAS - in most cases impossible, where the so-called SSAS is nothing but a receiving vehicle for the transfer.

The problem isn't DB transfers and never has been. It is the introduction of 'flexible access' to benefits that has created the current situation. 

I am not suggesting that pension scheme trustees should be giving advice. I am suggesting that in theory perhaps they should have some responsibility for the decision whether to allow someone to transfer a pension given the money is held in trust for the scheme members, however that's a role they cannot actually fulfil.

2nd_time_buyer

I wonder if a solution might be to have a lower level of required advice for part transfers. For example, if it can be demonstrated that the state pension and remaining DB benefits can meet some minimum annual amount. I guess the problem at the moment is not many offer it as an option.

eskbanker

Linton said:

Exactly - an attempt at irony.

Oops - it can be difficult to spot the difference, given the 'contributions' from some on these threads!

Marcon

Linton said:

Marcon said:

Linton said:

random129 said:

Prism said:

ZingPowZing said:

We digress. The principle of pension freedom is that the final determination belongs to the client. 

Agreed but how do you force private company platforms to accept the transfers.

The FCA and the government need to step in. Banning ALL DB pension transfers, although that's not what I want, would at least make the situation clear and prevent people wasting money on advice in the expectation they will ultimately be able to transfer regardless of the advice. There is still massive amounts of misinformation out there. A better solution, if it's not possible to compel fund managers to accept insistent clients, would be to set up a government owned fund that would accept all clients who have taken the legally required advice.

Barring all DB pension transfers would not be sensible as there are some cases such as seriously reduced life expectancy where it is clearly in the person's best interest.  One could include cases such as when the pensioner does not need the income and the pension scheme would benefit from reducing its liabilities.

So the problem is how do you implement a process where the justifiable more extreme cases are separated from those that aren't.  Either it's a government department that make the decision, or someone else.  In theory the pension trustees should be able act in a pensioner's best interests but they probably dont want the responsibility and dont have the time or training to assess the situation nor the ability to take on legal challenges.

So you're suggesting that pension scheme trustees should effectively be giving financial advice by deciding whether or not a transfer should proceed...? It's a criminal offence for someone to purport to give regulated advice if they are not regulated/do not hold the necessary permissions.

Trustees already have some responsibility for checking that the scheme to which the transfer is being made is a bona fide scheme, and you don't have to look far to see the fuss which results when they (or more likely the scheme's administrators) identify a dubious destination scheme and refuse to make the transfer. Their hand will be strengthened if the latest DWP proposals (currently under consultation) are adopted, as expected. In particular, it will make it very much more difficult to transfer to a dodgy SSAS - in most cases impossible, where the so-called SSAS is nothing but a receiving vehicle for the transfer.

The problem isn't DB transfers and never has been. It is the introduction of 'flexible access' to benefits that has created the current situation. 

I am not suggesting that pension scheme trustees should be giving advice. I am suggesting that in theory perhaps they should have some responsibility for the decision whether to allow someone to transfer a pension given the money is held in trust for the scheme members, however that's a role they cannot actually fulfil.

'Responsibility for the decision' sounds remarkably close to 'advice' to me. On what possible basis could they know better than a qualified financial adviser who has done all the necessary legwork before giving advice?

Trustees are fulfilling their role 100% by holding money in trust for members and applying it in accordance with the rules of their scheme (and in the best interests of beneficiaries as opposed to other parties, not on the basis of what might or might not be 'best' for a particular member).