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Early access could see Nest double annual charge

Government proposals to allow people early access to pension pots could force Nest to double its annual management charge, according to Standard Life.

This week, Treasury financial secretary Mark Hoban issued a call for evidence on the merits of allowing savers to draw on their pension fund before they reach age 55.

The document seeks views on the impact of early access on incentives to save and whether it should be permitted in situations of specific hardship.

Standard Life head of pensions policy John Lawson says: “Pensions in America cost a lot more than they do here and one of the reasons is that they provide early access for hardship payments.

“If Nest is eventually forced to offer this, I think it could double the annual management charge, so instead of charging 0.3 per cent, it will have to charge 0.6 per cent. I think the Government has to be very careful if it is going to go down this route.”

Nest chief executive Tim Jones says: “It is too early to say what the impact on Nest might be.”

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