Tom McPhail, Head of Pensions Research: 'The FSCP is right to identify that the market doesn't work for investors at retirement.

Everyone has unique needs so the solution has to revolve around making it much, much easier for them to find the retirement income solution which meets their particular needs. At the moment the system is so impenetrable it is hardly surprising that over half of retiring investors don't even shop around for the best deal.'

Five point action plan to improve the retirement market
Launch a task force, comprising Treasury, FCA, DWP officials and representatives from the pensions industry. Make shopping around the default at retirement – rather than offering the open market option as an afterthought, it should be the default solution for all retiring pension investors. Reform the Trivial Commutation rules to make it easier for savers with small pension pots to get their money back. Introduce a requirement for all auto-enrolment schemes to have a shopping around process built into their minimum standards. Launch a directory of shopping around brokers with minimum standards (PICA will launch one on 13 January 2014).

What can consumers do?
Consider the shape of your annuity as well as the rate- for instance whether to include a spouse’s pension or inflation-linking. Provide full details of health problems- they could get you a better rate. Wealthier investors should consider drawdown as well as annuities, it is possible to hedge your bets and have both. Consider consolidating pensions to make them easier to keep track of in the run up to retirement.