My Pension Expert’s latest research has shed light on the challenges faced by retirement planners in the UK when transferring their pension funds between providers.
The 2023 Retirement Fairness Index, based on data from over 3,950 pension transfers during the 2022/23 financial year, revealed significant delays in the process, with consumers waiting an average of 29 days for ceding companies to complete the transfers.
The analysis conducted by the independent retirement advisor measured the time from the submission of the application to the pension provider until My Pension Expert received confirmation of the fund transfer. These delays from ceding companies, the existing pension scheme providers, can have stressful and financially detrimental consequences for consumers.
While waiting for funds to move between providers, some may miss out on potential higher returns, while others, who rely solely on their pension for income, could face financial vulnerability during the pending transfer period.
Transfer times vary
The research highlighted considerable variations in transfer times among different pension providers. Prudential emerged as one of the fastest ceding companies, with an average transfer time of 18 days per transfer, followed by Clerical Medical (22 days), Reassure (22 days), Sun Life Financial of Canada (23 days), Standard Life (23 days), and Scottish Widows (24 days).
On the other end of the spectrum, XPS Administration took the longest, averaging 120 days for transfers, followed by DHL Pension Department (65 days), Willis Towers Watson (62 days), Nest (60 days), The People’s Pension (59 days), and Scottish Friendly (58 days).
Lily Megson, Policy Director at My Pension Expert, expressed concern over the prolonged transfer times and stressed the need for collaboration between the Government and the pension sector to address the issue. Megson stated, “Our data, spanning almost 4,000 pension transfers, clearly demonstrates that retirement planners in the UK are having to wait far too long for their hard-earned savings and investments to be transferred from ceding companies to a new provider. It is a significant issue and one that the Government and pension sector must work together to address.”
Pension transfers can take weeks
While acknowledging that some time is necessary for security checks and due diligence, Megson emphasised that the industry must challenge the accepted notion that pension transfers can take weeks, if not months, to complete. She called for increased transparency throughout the process to build and maintain trust in the pensions sector. “Transparency is key,” she said. “Retirement planners need to be able to see how much money they have in their pension pots, how those pots are performing, and, when transferring between providers, exactly how this process is proceeding. My Pension Expert is committed to tackling this issue, providing greater speed and transparency for pension customers across the country.”
My Pension Expert is actively engaging with the Government and industry bodies to promote transparency and work towards reducing ceding delays. By advocating for faster and more efficient pension fund transfers, My Pension Expert aims to improve the overall retirement planning experience for customers nationwide.
Amelia Brand is the Editor for HRreview, and host of the HR in Review podcast series. With a Master’s degree in Legal and Political Theory, her particular interests within HR include employment law, DE&I, and wellbeing within the workplace. Prior to working with HRreview, Amelia was Sub-Editor of a magazine, and Editor of the Environmental Justice Project at University College London, writing and overseeing articles into UCL’s weekly newsletter. Her previous academic work has focused on philosophy, politics and law, with a special focus on how artificial intelligence will feature in the future.
