Have your say: auto enrolment pension charge caps
Earlier this month the government announced three possible options for capping charges on auto enrolment pensions. This consultation has received support from consumer and trade organisations but the government is now opening it up to the general public to make sure “those who pay into pensions get their chance to put forward their views”.
The options for auto enrolment pension charge caps include:
- A higher charge cap of 1% of funds under management
- A Low charge cap of 0.75% of funds under management
- A two-tier “comply or explain” cap – this is a standard cap of 0.75% of funds under management for all qualifying auto enrolment schemes, with a higher cap of 1% available to employers who can report to The Pensions Regulator and explain why the scheme charges more than 0.75%
Pensions Minister Steve Webb commented on the consultation, saying: “We need to make sure that people can be confident that their hard earned savings are not being whittled away by unreasonably high charges. Our proposals for capping charges and increasing transparency are aimed at making the system fairer.
It is in everybody’s interest that we get this right so I am asking people to get involved in our consultation.”
By 2018 auto enrolment will have affected up to 11 million people by enrolling them into a workplace pension. If you want to have your say on the proposed changes, you can respond to the consultation by Thursday 28th November.
One of the first steps you should take in preparing for auto enrolment is educating yourself on the change, and the steps you need to take to make sure you are ready. If you still haven’t taken this first step, why not download our free introductory guide?