UK. Pension fee shake-up
Proposals include introducing a threshold of £100 or below which a person cannot be charged a flat fee by their pensions provider, helping limit the erosion of small pot pensions and protect savers.
This will stop pensions worth £100 or less and invested in the default funds of schemes used for automatic enrolment being gradually whittled away by the fees, a situation commonly faced by people who change jobs frequently or take up short-term contracts.
Minister for Pensions, Guy Opperman said:
We all know what a success automatic enrolment has been in getting more people saving into private pensions – with over 10 million employees paying into a workplace pension since 2012.
But for some, particularly those who regularly take on short-term work and change jobs frequently, there is a greater chance that they will be automatically enrolled into new workplace pensions a number of times, building up a collection of small pots. It is this group we want to help by changing the way fees work.
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