Overview

The Financial Guidance and Claims Bill aims to improve consumer protection in the financial sector, particularly concerning pensions and claims management services. Key changes include mandatory guidance referrals for pension transfers, restrictions on fees charged by legal practitioners for Payment Protection Insurance (PPI) claims, and potential regulations against unsolicited marketing of financial products.

Description

This bill makes several key amendments to existing financial regulations. It introduces:

• Mandatory Pensions Guidance: Requires trustees and managers of pension schemes to refer members to pensions guidance before they transfer funds or start receiving benefits.
• PPI Claims Fee Caps: Imposes temporary restrictions on the fees legal practitioners can charge for PPI claims, preventing excessive fees. This involves establishing clear fee caps and a timeline for their implementation.
• Unsolicited Marketing Bans: Grants the Secretary of State the power to make regulations banning unsolicited direct marketing for pensions and potentially other financial products. This includes provisions for consultation and parliamentary approval.
• Enhanced Consumer Protection: Strengthens the consumer protection function of the single financial guidance body by mandating reporting of detrimental practices by regulated firms and regular assessments of the impact of unsolicited marketing.
• Extended Jurisdiction: Expands the bill's application to all parts of the UK (England, Wales, Scotland, and Northern Ireland), with specific implementation details for each region.
• Data Protection Updates: Updates references to data protection legislation to reflect current laws.

Government Spending

The bill's financial impact is not directly stated in the provided text. However, it is likely to involve costs associated with the administration of new regulations and guidance, potential compensation payouts related to PPI claims, and enforcement actions. The exact figures are not available in this document.

Groups Affected

• Pension scheme members: Required to be offered guidance before significant financial decisions regarding their pensions.
• Pension scheme trustees and managers: Required to follow new procedures for referring members to guidance.
• Legal practitioners handling PPI claims: Subject to temporary fee caps for their services.
• Consumers: Potentially better protected from unsolicited marketing and misleading financial advice.
• Financial institutions: May face increased regulatory scrutiny and potential penalties for non-compliance.
• Marketing firms: Potentially subject to new regulations limiting unsolicited marketing of financial products.

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