Fewer than one in five (18%) retirement savers who accessed a defined contribution (DC) pension in the last four years had a telephone or face-to-face appointment with Pension Wise, the Financial Conduct Authority (FCA) has found.

Pension Wise is the core protection in place to support consumers when making complex decisions about how best to access their pensions. It was introduced in 2015 during the pension ‘freedom and choice’ reforms because the Government recognised that it is important that people have the resources available to make the best decision for their personal circumstances.

In the Financial Lives research for 2022, the FCA found that the number of people that have had a Pension Wise session has increased slightly from 2020 to 15%, despite interventions to boost take-up.

Furthermore, the report found that 13% of those accessing pensions had a telephone call with a Pension Wise specialist, with 5% having a face-to-face appointment. Just Group has suggested that the number reflects a switch to telephone appointments when face-to-face sessions were halted during the pandemic.

One in five (20%) also said that they used the Pension Wise website, with the remaining 63% saying that they did not use the service or were not aware of it.

Group communications director at Just Group, Stephen Lowe, said: “The majority of people know it exists but we’ve yet to see a take-off in terms of usage, especially of the one-on-one phone and face-to-face sessions with a trained specialist that are the most valuable parts of the service.

“Pension Wise gets rave reviews – 88% of those who used the service said it helped them decide what course of action to take. It doesn’t seem right that so many people are making irreversible decisions about how to use their pension savings, without getting some guidance.”

Despite Government signposting towards the service through providers and employers, and revised ‘wake-up’ packs to promote Pension Wise, Just Group said the FCA figures demonstrate that these interventions are not enough. A ‘stronger nudge’ requirement was introduced in July 2022, which required pension member wishing to access or transfer a pension to be offered a Pension Wide appointment.

MPs on the Work and Pensions Select Committee have recommended that the Government should go further by setting a target of 60% in the proportion of individuals using the service and trialling automatic appointments to set up a guidance session, unless the member opted out.

Lowe added: “We are still waiting to see the impact of the ‘stronger nudge’ but the results from the trial suggest the approach will prove to be too timid.

“We think most pension savers should be having an appointment, especially those who are vulnerable or do not have access to financial advice. We need to see a transformation in the proportion having a session.

“The Government keep rejecting proposals to test the impact of an automatic appointment pilot. But they and the FCA are pursuing no other meaningful activities to drive up Pension Wise usage. They’ve given up and are out of ideas as the data from the FCA illustrates.”

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