The Pensions Regulator's strengthened guidance on transfer incentives is permeated by a "presumption of guilt", industry figures have said.
The watchdog's latest guidance said trustees should start from the presumption such exercises were not in members' interests and should therefore approach any exercise "cautiously and actively".
Despite this, Hewitt Associates said it was "disappointed" with the move.
Pension consultant Alan Howard said he did not agree with the regulator's view that only a minority of members are likely to benefit from accepting a transfer incentive.
And he said the regulator's comments on possible legal action faced by employers and trustees who engage in these exercises may unnecessarily discourage companies from carrying them out - even if they completely comply with the letter and spirit of the guidance.
Howard said: "As long as the member has access to the full facts, and suitable technical support, it should not be presumed that a member is incapable of taking an informed decision about his future benefits."
He added many members will prefer the flexibility of their own pension pot as provided by an enhanced transfer value exercise - especially after the government's proposal to change the inflation index used to increase pensions from the retail prices index to the consumer prices index (PP Online, 8 July).
Independent Trustee Services director Peter Askins said: "It is guidance, not regulation. Our concern as trustees is the assumption that you start from a position of it is always in the company's interest and rarely in the member's interest.
"The key change in this new guidance is that trustees should be actively engaged in the process whereas the legal advice has always been that as trustees we shouldn't be involved because it's a matter for the employer. If the regulator wants to take a stance against cash-equivalent transfer enhancements that's fine, but rather than using trustees as the way of regulating the process I would have thought, with the amount of influence the regulator has, it would be simpler for him to persuade the government to change the regulations."
In December last year, the regulator said trustees should start from the presumption that such exercises and transfers are not in member interests (PP Online 10 December, 2009).
