A consultation on a cold-calling ban will be published “imminently”, the government has said as it laid out plans for the policy.
Regulations for the ban will likely be introduced in the autumn, it added, with these then taking effective as quickly as possible afterwards.
The long sought for ban will likely target all communications relating to pensions where the person contacted does not have a prior relation to the company contacting, whether via phone, email or text message.
The ban is required under the Financial Guidance and Claims Act 2018, with regulations due to be published by June this year. However, the government missed this deadline and was then required to issue a ministerial statement to parliament explaining the reasons why.
In this statement to the House of Commons, made on 12 July, economic secretary to the Treasury John Glen said the delay was due to the government wanting to ensure the detail was right.
“Pensions cold calling is an important and complex issue,” he said. “Pensions scams can have devastating consequences and cold calling is the most common method used to initiate pension scams, so the government has taken the time to ensure the ban works for consumers.
“The government will imminently publish a consultation seeking views on a set of draft regulations to ban pensions cold calling. Once we have considered all responses to the consultation, in the autumn we intend to lay regulations under the affirmative procedure and, subject to parliamentary approval, bring the regulations into force as soon as possible thereafter.”
‘Good day to bury bad news’
The affirmative procedure requires both the House of Commons and House of Lords to approve the regulation before it can be enforced.
The statement comes as City of London Police figures revealed £51m had been lost to investment fraud in the first three months of this financial year, some of which includes pension scams. This was significantly higher than the £30m and £24m amounts reported in the first three months of 2017/18 and 2016/17 respectively, according to analysis of the figures by AJ Bell.
Royal London director of policy Sir Steve Webb said the government had “chosen a good day to bury bad news” in admitting the delay, noting it had opted for the day both the Brexit white paper was published and Donald Trump’s visit to the UK began.
“Nobody doubts that if this issue was a real priority for the government, a ban would already be in place right now,” he said. “The repeated delays mean yet more innocent people will be scammed out of their life savings by crooks who ring them up out of the blue with persuasive offers and pressure sales techniques.
“It is understandable that the government is embarrassed by this delay, but now they need to pull out all the stops to get this legislation through and in force.”