UK - The recommendations of the Thornton report to combine the Pensions Ombudsman (PO) and Financial Ombudsman Service (FOS) will benefit consumers, according to Paul Thornton, who carried out the review.
Thornton insisted the report did not recommend scrapping the PO, but said there were irrefutable economic and resource benefits in combining the services.
Consequently, he said: “Consumers should find it easier to know where to go with a pensions query.”
As a result of the review the Pension Protection Fund (PPF) and The Pensions Regulator (TPR) escaped falling victims of a merger.
This was because Thornton said the time and legislative costs involved in combining the two services would consume valuable resources needed by parliament.
Despire this, Thornton told Global Pensions that a number of streamlined practices must be implemented by the PPF and TPR, which would be monitored by the Department of Work and Pensions (DWP).
He said: “I came to the decision fairly early on and it was reassuring that to hear the near unanimous view from stakeholders to keep the bodies separate.”
PPF chief executive, Partha Dasgupta, welcomed the report's recommendations: “We feel this is the best way for us to carry out our core function of paying the correct amount of compensation to the right people at the right time.”
Following the review, Thornton also said the FSA and TPR would have to work “more visibly” together as defined contribution (DC) pension funds become more widespread.
He warned, however that "heavy handed regulation" would not encourage pension provision by UK employers.
Thornton added that the Pension Advice Service should remain in its current role despite the PO/FOS merger.
Paul Thornton, a former Watson Wyatt partner and president of the Institute of Actuaries, was appointed to carry out the review in January 2007.
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