More than 1,000 firms have altered or cancelled their defined benefit (DB) pension transfer permissions in the last two years, a freedom of information (FOI) request submitted by Professional Adviser has revealed.
PA’s request for information to the FCA revealed in 2019 a total of 411 firms added a limitation to their permissions so they could no longer advise on DB pension transfers.
A total 710 firms with permission to conduct pension transfers altered their permissions during 2019. Away from those who added a limitation on their permissions to prevent them carrying out DB transfers, 166 cancelled their regulatory authorisation and 133 withdrew their pension transfer permissions altogether.
Last year marked a dramatic increase in permission variation from 2018, when 316 firms changed their pension transfer permissions, with 207 cancelling or withdrawing their permissions and 109 making variations to their permissions.
Speaking at a Treasury Committee hearing earlier this month, then-FCA chief executive Andrew Bailey said just 370 firms had left the pension transfer market in the last two years. PA’s figures, however, suggest 1,026 have in some way cancelled or varied their pension transfer permissions in 2018 and 2019. This infers approximately a third of those that had pension transfer permissions when the FCA sent around its marketwide survey in 2018 have left the pension transfer market.
FCA intervention
PA’s FOI also revealed that, in 2019, a total of 28 firms varied their permissions or added requirements to their permissions as a result of FCA interventions following its market-wide data request.
Additionally, last year the financial watchdog contacted various firms that expressed they had not used their permissions. Of those, 306 agreed to remove or vary those permissions following that interaction.