A pensions cold-calling ban is currently “out of scope” in the Single Financial Guidance Bill, it has been indicated.

Speaking at the House of Lords’ debate on the Single Financial Guidance Bill, Baroness Buscombe noted that while the committee intends to “bring forward a ban on pension scams”, it cannot be completely precise on its timing.

Buscombe stated that: “We cannot be entirely accurate on timing because…we have to find a legislative opportunity. As I have just said, we will introduce draft legislation early next year and that will go through a process of pre-legislative scrutiny. I hope noble Lords will accept that this is very sensible in order to get it right.

“We cannot introduce the ban on pensions cold calling in this Bill because it is out of scope.”

However, Baroness Kramer was not in agreement with this claim. She argued that the amendment “is in scope”.

Kramer highlighted: “It [the Bill] allows the banning not only of cold calling, but of a broader range of issues. The point made from the Labour Benches was that the Government always said they would have done it in this Bill had there been any mechanism for it to be in scope. It is now in scope, which is why we are debating it on the floor today. We are not debating an out-of-scope amendment.”

Looking at the potential scope of a cold-calling ban in the Bill, Kramer discussed that the “beauty” of this amendment could present the opportunity to “deal with the whole industry” rather than banning cold calls on just pensions, as the ban on mortgage cold-calling was legislated.

Also speaking in the Lords, Lord Sharkey emphasised that cold calling is an “omnipresent menace”. It was highlighted that at present, 2.6 million cold calls are made every month; an increase of 108 per cent in the last 10 months.

Lord McKenzie of Luton added: “I repeat that commitment, which would include banning all unsolicited approaches, including texts and emails…We want to ban pensions cold calling because a private pension is often an individual’s most valuable asset. Scams can cost people their life savings and leave them facing retirement with limited income and little or no opportunity to build their pension savings back up.”

Ultimately, however, a vote called for by Liberal Democrat peer Sharkey saw peers defeat the government with a vote for pensions cold-calling to be banned by 253 votes to 205.

While this was widely supported, Viscount Trenchard argued a cold calling ban of phone and text may not be a wholly positive strategy. This is because, he said, if all unsolicited approaches were made illegal, including those by letter or email, the business market would face hurdles in marketing its services to new potential customers.

In relation to the cold-calling ban, the Lords also discussed the creation of a new, currently unnamed single financial guidance body, which would regulate the ban, improve financial capability, help more people to engage with their pensions and to reduce debt problems.

Similar to Kramer’s suggestion of an all-encompassing cold-calling ban, Buscombe commented that the financial body “will not exist in a vacuum… The intention is to allow unpublished data, such as performance-related statistics and confidential insights gained into the financial guidance landscape, to be shared. This information may include personal data as long as any disclosure is in accordance with the Data Protection Act.”

The body, as stated in Amendment 2 of the Bill, will be expected to publish an annual assessment of consumer loss as a result of cold-calling, to advise the Secretary of State to establish bans on cold-calling and to give the Secretary of State the power to introduce a ban on cold calling, if recommended by the guidance body, Buscombe noted.

“The noble Baroness, Lady Kramer, said that we need protection now. If Amendment 2 were passed, there would be much more delay than if the Government were to wait,” Buscombe concluded.

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