The Government has outlined plans to remove "unjustifiable barriers" to allow people easier access to their pension pots.

In its response to the Pension Transfer and Early Exit Charges consultation, the Government said people will be able to make easier transfers and get information.

The consultation found that whilst the majority of eligible individuals are able to access their pension under the new freedoms, there are a small but significant number who have been effectively prevented from accessing the pension freedoms because of high exit charges or long transfer times.

It found that for Financial Conduct Authority(FCA)-regulated contract-based pension schemes, transfers took 16 days on average, however, TPR data showed that the mean transfer time for trust-based pensions was 39 days, with many consumer survey respondents saying that they had to wait significantly longer for individual transfers.

As part of the Government response, economic secretary to the Treasury, Harriet Baldwin said: 'It is only fair that people who have worked hard and saved their entire lives are able to access their pensions flexibly, without facing any unjustifiable barriers - that's why we're taking action to curb excessive exit charges, make transfers easier and ensure people have the information they need to make informed decisions."

The response outlines that the Government will introduce a new requirement for trust-based pension schemes to regularly report on their performance in processing transfers.

It also says The Pensions Regulator (TPR) will issue new guidance for scheme trustees to ensure transfers are processed quickly and accurately.

Pension Wise will develop new content on the transfer process, which will include information on likely timescales, what customers need to do and greater clarity on whether financial advice is required, the response says.

The move builds on the Chancellor's announcement last month that the Government would limit early exit charges for people seeking to access the freedoms.

Graham Vidler, director of external affairs, Pension and Lifetime Savings Association said the organisation welcomed the response: "We welcome the Government's response to this consultation and the commitment to publish guidance for trust based schemes on how to improve transfer times."

First published 11.02.2016

Lindsaysharman@wilmingtonplc.com