Now: Pensions comments on the pensions proposals outlined in the Queen’s speech
Morten Nilsson, CEO of NOW: Pensions said: “At the centre of all the reforms being introduced by the government is a desire to improve value for money for pension savers.
With more than eight million people set to start saving into a pension as a result of auto enrolment, ensuring that their pension delivers on its promises is a must.
The government’s top priority should therefore be to address the things we know for certain have an impact on savers’ pension pots namely the level of contributions made, the charges imposed and the design and performance of the default fund.
Get these fundamental things right, and savers will see a significant uplift in their income in retirement without the need for further complexity in scheme design.
Whilst innovations such as collective DC schemes have been successful in Denmark and the Netherlands, both of these markets are highly unionised and have had mandatory or quasi mandatory pension saving for many years.
The populations are relatively homogenous and the collective DC schemes operate on an occupational basis with people from similar professions sharing risk with one another – a much fairer approach than manual workers sharing risk with white collar workers.
The UK is a much more fragmented market and while changing legislation to allow these schemes could have merit, in many ways it feels as though we are running before we can walk.
Like it or not, UK companies have limited appetite for pension liabilities and consumers have limited interest in locking themselves up in risk sharing arrangements. As the market grows and matures, this position might alter but I think we have some distance to travel.”
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NOW: Pensions www.nowpensions.com
NOW: Pensions is an independent, multi-employer trust serving thousands of employers and hundreds of thousands of employees from a wide range of sectors.
A subsidiary of one of Europe’s largest pension funds, Danish pension scheme ATP, NOW: Pensions offers a simple and cost effective workplace pension solution direct to employers and via advisers and the payroll sector.
In April 2013, NOW: Pensions became the first master trust to attain the NAPF’s new PQM Ready Standard. The benchmark shows employers that NOW: Pensions is a well governed pension scheme with low charges and good member communications.
The NOW: Pension Trustee Directors, whose role is to safeguard the interests of members, comprises well-known industry figures with different areas of expertise:
- Jocelyn Blackwell, founding partner Dunnett Shaw
- Christopher Daykin, former Government Actuary
- John Monks, member of House of Lords and former General Secretary of ETUC and TUC
- Win Robbins, former Head of European Fixed Income at Barclays Global Investors
- Nigel Waterson, former Shadow Pensions Minister
Charges are just £1.50 per month administration charge (reduced administration charge of £0.30 – £1.00 to be applied during auto enrolment phasing for lower earners) plus a 0.3% annual product investment management charge, with no hidden charges.