Private Pensions

Part of Orders of the Day — Opposition Day – in the House of Commons at 6:35 pm on 30 March 1994.

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Photo of John Butterfill John Butterfill , Bournemouth West 6:35, 30 March 1994

I agree entirely with my hon. Friend. He and I have taken a long and consistent interest in the issues. It is long overdue that the major companies—particularly those with direct sales forces—ensured that they were adequately trained.

It is a reflection of the inadequacy of the training that the KPMG report—I have here also an analysis of the report from the Association of Consulting Actuaries—shows, interestingly, that pension schemes sold by independent financial advisers—IFAs—tended to be much better advised than those directly sold by the insurance companies. One might expect that that should be the case for all sorts of reasons. An independent adviser would be more likely—indeed, would be required—to look around the market at a variety of products before coming down in favour of one on behalf of the client, whereas those who are tied can offer only the product of their own company.

That factor is also probably due to the fact that many of those recruited had very little experience of the nature of occupational pension schemes. At least the IFAs knew something about them. The new recruits may have been car salesmen yesterday—