Reaction to the FCA’s Retirement Outcomes Review final rules and guidance
The final policy statement relating to the Retirement Outcomes Review was released on 30 July detailing the final set of FCA remedies, aimed at providing primarily non-advised consumers with some additional protections when entering the decumulation phase. To read the full document please click here.
We broadly welcome the proposals and believe they will provide consumers with a level of guidance and support when considering a decumulation investment strategy.
We are pleased to see that some of the recommendations included within our response have been considered and included in the final set of rules. In particular, we do not believe the number of solutions for each Investment Pathway objective should be restricted to a single solution and we welcome the change in the policy statement, which gives providers the option to design multiple solutions under the umbrella of the main objective enabling a pathway to be presented which is more aligned to a consumer’s personal circumstances.
Additionally, we do not think a consumer needs to be presented with the Investment Pathway options for a second time. This complicates the process, is unlikely to be effective and extends the timeline which is likely to create negative consumer perceptions. We are therefore pleased to see this additional step in the process now removed.
The implementation timescales, however, do look challenging considering the work involved and we would have preferred to have seen this moved back until April 2021, rather than keep the proposed August 2020 date.
It will be interesting to see the impact these new rules will have following implementation and will stay closely aligned to the outcomes from the review the FCA intend to make one year from implementation.
This, of course, forms just one aspect of the various changes that are in motion within the Retirement landscape at present. Our forthcoming inaugural Annual Retirement Conference in winter 2020 will be covering a number of topical areas with expert speakers sharing their insights. Further details will follow in the near future.
Retirement Policy Manager
Date: 7 August 2019