The National Association of Pension Funds (NAPF) today (Thursday) gave an initial welcome to the OFT’s final report on the DC pensions landscape but argued that it should have gone further to ensure good outcomes for pension savers.
Joanne Segars, NAPF Chief Executive, said:
“This report is very much needed and we agree with a lot of the analysis.
“The NAPF has been leading the way on promoting transparency in charging so we welcome the report’s recommendation for action. We support its proposals to tackle legacy issues such as high charges but want to be assured that the proposed audit of legacy contract-based schemes will be properly independent. We welcome the recommendation that small trust-based schemes are subject to scrutiny by the Pensions Regulator to ensure they offer value for money, as all pension schemes should be providing value for money, although we wish the OFT had gone further and recommended consolidation and the creation of super trusts.
“We are particularly concerned that the report risks letting down pension savers who need someone solely on their side, with the independence and power to act in their interests, to make sure they get the best outcomes for their retirement savings. We would have preferred a clear direction that employers have a choice – they should either be prepared to provide governance themselves or use a master trust arrangement. The proposal to have governance as part of the provider risks fudging the issue and leading to potential conflicts of interest.
“The report has set the future course with the right long term principles to secure good outcomes for pension savers. But we feel that action is urgently needed now. With automatic enrolment underway we need to get things right now, not further down the line.”
In conclusion, Ms Segars said: “As always, the devil is in the detail. We now need a period of consultation on the OFT’s recommendations and a clear plan from the Government as to how it would implement them.”
Notes to editors:
1. The NAPF is the leading voice of workplace pensions in the UK. We speak for 1,300 pension schemes with some 16 million members and assets of around £900 billion. NAPF members also include over 400 businesses providing essential services to the pensions sector.
Dee Sullivan, Head of Media and PR (interim), 020 7601 1717 or 07917 506 683,
Aimee Savage Richards, Press Officer (interim), 020 7601 1718 or 07825 171 446,