The Financial Conduct Authority’s (FCA) pension guidance consultation is too skewed to promotion Pension Wise and risks detracting from Financial Planners who may better serve customers, according to pension and investment providers.

The FCA’s proposals in its latest pension consultation aim to make sure consumers have either received or opted out of receiving Pension Wise guidance when applying to access their pension savings.

However, Aegon said the current proposals put too much emphasis on Pension Wise where they should also be signposting consumers towards taking regulated financial advice.

Steven Cameron, pensions director at Aegon, said: “We strongly believe the benefits of seeking regulated financial advice should be given at least as much prominence, with any guidance services offered by providers also signposted. This would allow consumers to make an informed choice based on their needs and the likely costs.

“Financial advice provides a much deeper support for a customer than Pension Wise guidance, including a personal recommendation. So it’s particularly controversial for the FCA to be proposing even customers who have already taken financial advice on retirement options to still be nudged to Pension Wise. In many cases, the adviser may be supporting the customer in implementing their decision to access. While customers can opt out, requiring providers to nudge to Pension Wise in these situations could be seen by customers as the provider questioning the adviser’s recommendation.”

Aegon also said that ‘in house’ guidance from providers should also be signposted where it has been designed and implemented to be impartial. Mr Cameron said he expects personalised guidance support becoming increasingly expected of provider firms under the FCA’s new consumer duty proposals and again should be signposted alongside the other support options.

Investment and platform provider Standard Life Aberdeen also expressed concerns that, if not properly delivered, the proposed drive of consumers towards Pension Wise could backfire and see less people taking advice.

Alastair Black, head of platform proposition at Standard Life Aberdeen, said: "We think there is a risk that, if this is not handled appropriately with suitable rules from the FCA on how this should be delivered, that we may see this shift in the wrong direction away from advice, resulting in poorer outcomes for many.

“Where the FCA propose telling consumers about free impartial guidance or advice they have to pay for – the fact it calls out it has to be paid for (while of course true) risks creating a bias away from advice if consumers don’t understand the value that it can give.

“Consumers should understand that with guidance via Pension Wise they’ll still have to make their own decisions. If they can pay for financial advice, they have the opportunity to discuss and agree with an expert what would be best for their individual circumstances.”