Update Thursday 23 November: Since we published this story, Chancellor Philip Hammond has confirmed in his Autumn Statement that a consultation on the pension cold-calling ban will be launched before Christmas.
Chancellor Philip Hammond is expected to use the Autumn Statement, which he will deliver on Wednesday (23 November), to unveil plans to clamp-down on pension cold-callers who prey on vulnerable people. Those who flout the ban will face fines of up to £500,000.
Under the proposed new regime, all calls where a business has no existing relationship with an individual will be forbidden. This includes scammers targeting people who inadvertently 'opt in' to receiving third party communications.
While the proposed ban will only cover calls initially, it is understood the Government will explore plans to expand the ban so that it also covers emails and texts.
The Government's decision to introduce a pension cold-calling ban comes just a month after MoneySavingExpert.com founder Martin Lewis backed a petition that stated a ban "would dramatically reduce the number of people falling prey to fraudsters and losing their savings and pensions".
The petition currently has just over 7,800 signatures (it needs 10,000 to trigger an official Government response). However, the fact the Government has already decided to take action represents an early victory for those who have supported the petition.
The Government will consult on the proposals before the end of the year and the next steps will be announced at next year's Budget. For help in stopping unwelcome cold-callers, as well as junk mail, calls and texts, see our Stop Cold Callers guide.
What's the Government proposing?
Under the plans, all unsolicited pension calls from a business that you've never dealt with will be banned – regardless of whether or not you've previously 'opted in' to receiving third party communications. Enforcement action by the Information Commissioner's Office against those who breach the ban could include fines of up to £500,000.
In a statement the Treasury said: "Philip Hammond will use this week's Autumn Statement to announce the Government's intention to ban pensions cold-calling, protecting millions of vulnerable people and cutting off the main route through which cowboys trick people out of their life savings."
Meanwhile, the Chancellor will consult on a wider crackdown on pensions scams by:
- Giving more powers to firms to block suspicious transfers, preventing people's life savings being transferred into scams without any checks
- Making it harder for scammers to open fraudulent pension schemes, through stopping small self-administered schemes setting up using a dormant company as the sponsoring employer
What do pension scams look like?
Pension scams come in different forms, but they mostly tend to offer 'unique investment opportunities'. This could involve asking you to invest your pension pot in a new hotel in an exotic location or in various 'ethical' projects that promise massive returns.
Around 250 million scam calls are made every year in the UK, which equates to eight every second, according to the Treasury.
It's been calculated that almost 11 million pensioners are being targeted annually by cold-callers, with savers reporting estimated losses of almost £19 million to pensions scams between April 2015 and March 2016.