The FCA has published a press release on a Thematic Review that it intends to undertake to assess the advice that customers are receiving on meeting their income needs in retirement. The review will be “a piece of discovery work to explore how financial adviser firms are delivering retirement income advice and assess the quality of outcomes consumers are getting.”
The press release refers to the introduction of the government’s pension freedom reforms, which has changed the way consumers access their retirement savings. It notes that, given the wider range of retirement options available, it is vital that consumers obtain good advice at the point they first access their pension savings and, where relevant, on an ongoing basis. Previously planned work on this topic (known as ‘Assessing Suitability Review 2’) was paused to allow resource to be concentrated on the FCA’s response to the COVID-19 pandemic.
This new Thematic Review is expected to examine how the retirement income advice market is functioning. It will also focus on firms’ responses to changing consumer needs as a result of the rising cost of living. The review is to refer to the lifetime mortgages work that the FCA committed to in its 2022/23 Business Plan. The FCA intends to use the findings to help inform its future strategy for the sector. The results will also be an important indicator of how firms are implementing the Consumer Duty.
The review will begin in Q1 2023 and the FCA aims to publish a report setting out its findings in Q4 2023. Firms selected for the review can expect to be contacted early in 2023.
Press release
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