Which? has today launched a new campaign calling on Pensions Minister, Steve Webb, to do more to protect people’s retirement funds from high charges.
We believe the recently proposed cap on auto-enrolment pensions should be lowered from the proposed 0.75%, to 0.5%, and be extended to cover all new and existing workplace schemes.
This seemingly small reduction could mean a difference of £40,500 in your pension fund at retirement and a saving of around £4.8 billion just over the next 10 years.
Lower pension charges for all
Last week the Government announced plans to reform the pensions market, proposing a cap on administration fees for auto-enrolment schemes.
Which? is calling on the Government to lower the level of the proposed new cap, extend the proposals to more schemes and ban other unfair charges.
‘Hands Off My Pension’ campaign launched
To protect people’s retirement funds, Which? is launching the Hands Off My Pension campaign calling for the Government to:
- Set the proposed charge cap at 0.5%.
- Roll out the cap to cover all new and existing workplace pensions.
- Ban hikes on annual management charges when switching job.
Support the Hands Off My Pension campaign and share your views.
No room for ‘rip-off pension schemes’
Which? executive director, Richard Lloyd, said: ‘Millions of people are currently paying in to rip off pensions, but many might not realise so much of their money is being taken in fees until it’s too late.
‘While we strongly support the direction of the Government’s plans there is an urgent need for better minimum standards for all workplace pensions so people can be confident that they are being enrolled into high quality, good value schemes.
‘With consumers being squeezed by the rising cost of living, there is no room for rip-off pension schemes in the workplace.’
The call for lower charges comes as millions of people will be signed up to workplace pension schemes for the first time, under a process of auto-enrolment.
A Which? investigation earlier this year found a third (35%) of people who have opted out of auto-enrolment, or say they will opt out, do so because they do not trust the pension industry to look after their money, and one in five (22%) because they are concerned about the quality of the scheme.