The National Association of Pension Funds (NAPF) commented on a letter that the Association of British Insurers (ABI) sent to the Financial Services Authority and the Pensions Regulator today.
The letter called for an action plan to make pension charges and costs clearer and more transparent for employees.
Darren Philp, Director of Policy, NAPF, said:
“Fears about charges are putting people off pensions, and the industry must address that by being more upfront about its fees. Communication needs to become simpler and more transparent across the pensions landscape. Savers must not be overloaded with unfathomable small print.
“New rules could see up to 8m people automatically enrolled into a pension, many for the first time. If they’re to stick with that pension then they must be able to gauge whether they’re getting a good deal.
“We have been concerned about charges for a long time, which is why last year we kick-started work on an industry code to give better information to employers. When auto-enrolment starts, that code will help businesses pick the right pension for their staff.
“This call to improve transparency for employees is a welcome next step and could help build on the charges work already being done by the industry. It’s vital that all groups are involved – consumers and employees must not be left out, particularly as this work is aimed at them.
“The current regulatory system causes confusion, and having two regulators for workplace pensions does not help. Ultimately the goal is a clear and stable environment that delivers the best pensions possible.”
Notes to editors:
1. The NAPF and an industry working group are set to publish a Code of Practice on defined contribution pension charges for employers this autumn.
2. The NAPF is the leading voice of workplace pensions in the UK. We speak for 1,200 pension schemes with some 15 million members and assets of around £800 billion. NAPF members also include over 400 businesses providing essential services to the pensions sector.
Paul Platt, Head of Media and PR, NAPF, 020 7601 1717 or 07917 506 683, [email protected]
Christian Zarro, Press Officer, NAPF, 020 7601 1718 or 07825 171 446, [email protected]