The government’s consultation on the regulatory charge imposed on pension schemes was due to close today (September 8) with proposed changes set to be rolled out in April 2027.

In its response to the Department for Work and Pensions, Tisa has called for stronger evidence to justify proposed changes to pension levies.

It said while it supports the principle of having different levy rates for different scheme categories, it was concerned about the proposed “significant increases” for master trusts and personal pension schemes.

DWP is proposing a 9 per cent annual increase for master trusts and personal pensions, 6.2 per cent for defined contribution schemes and 5 per cent for defined benefit schemes.

Renny Biggins, head of policy for products and long-term savings at Tisa, said: “Significant increases need clear evidence behind them, particularly for master trusts and personal pension, to maintain industry confidence that what they are paying is proportionate and delivers value.

“The industry is already managing a huge amount of regulatory change, while continuing to invest in better products and services to improve outcomes for pension savers.

“As additional regulatory costs risk diverting investment away, it needs to be clearly justified and introduced with sufficient time to allow firms to plan.”

Pensions UK has also called on the government to carry out a full review of the general levy framework before introducing the increase on costs faced by pension schemes.

In its response to the consultation, it said it recognises the need to address the general levy deficit but claimed the current framework had not kept pace with changes in the pensions market.

It claimed higher levy costs could affect member outcomes and business planning and said a review should be launched to consider what the levy funds and how costs are allocated across different types of schemes.

Julian Mund, chief executive of Pensions UK, said: “Without greater transparency and a clear evidence base, there is a risk that further increases to the general levy could place disproportionate costs on some schemes and savers, distort value for money assessments and cut across the government’s own objectives on consolidation and better retirement outcomes.”

Mund went on to say the government should not make significant changes to the system before a review into what the levy funds.

He added: “The government should now commit to a full review of the levy framework, with clear principles for how costs are allocated in future.

“In the meantime, a cap on individual levy liabilities would be a pragmatic way to manage the most significant impacts while still allowing progress to be made on reducing the deficit.”

Read more @ftadviser