Pensions are “the biggest single challenge” ahead for the finance sector, the FCA’s new chief executive says.

Andrew Bailey began his role as head of the FCA, after moving from the Prudential Regulation Authority earlier this month.

He has taken over from acting chief executive, Tracey McDermott.

Speaking at the FCA annual public meeting, he said: “Since 2012, the pension and retirement income market has undergone the most profound change in a generation.

“The UK, like other nations, is dealing with a huge challenge to ensure that our ageing population is able to make the right choices about how they save for and fund their retirement.

“This is requiring us to work closely with a range of organisations within and outside Government.

“I regard this as the biggest single challenge ahead in the provision of financial services in this country.”

He said: “The Government has introduced widespread reforms which give firms greater responsibilities to support employees in accumulating retirement funds and consumers greater flexibility in how they access their pension funds.

“In this complex landscape it is essential that we are clear about where we are focused.”

He emphasised that the focus will remain on consumer protection and said the changes made recently by the FCA look at ensuring that consumers get “relevant, timely and adequate information to help them explore the range of options for accessing pension savings and enable informed decision-making both at their intended retirement date and beyond”.

Mr Bailey also addressed the advice sector.

He said: “In simple terms the Retail Distribution Review has achieved its objective of removing opaque charging through commissions and improving the training and qualification of advisors, but had – along with a number of other significant developments – contributed to an advice gap opening up for the less well-off and those in need of single event type advice.”

FAMR and acknowledged “the recommendations and their implications are of huge significance for those who operate in the financial advice market”.

He pledged to work with stakeholders as the FCA continues this work.