PASA to produce code of conduct on switching

The organisation – which aims to improve standards in the administration industry – is setting up a sub-committee with the aim of publishing a voluntary code by January.

It will address problems that have been raised over firms charging exorbitant exit fees for clients who decide to change providers or refusing to hand data over to the incoming administrator.

PASA chairman Margaret Snowdon said: “This is a minority of firms, but we’re really fed up with how some of them are treating customers.”

Snowdon said the code would focus on how exit arrangements were defined in contracts drawn up when schemes appointed an administrator.

She added that she hoped a voluntary code of conduct would sort out the problems without the need to introduce fresh regulation.

“We want to see providers ceding business gracefully,” she said. “They have to realise it will benefit them in the long term because what goes around comes around.”

This comes as The Pensions Regulator has become increasingly concerned over the issue – warning last year that the market was not functioning properly.

And, at this year’s Professional Pensions Admin Forum, TPR case team leader Victoria Holmes said the watchdog was to launch an investigation into poor practice.

The regulator said this research was still continuing but it welcomed the PASA initiative. A spokeswoman said: “We are pleased that the industry is recognising that this is an issue that needs to be addressed.”