Government and regulators must review the issue of pension transfers “as a matter of urgency” to allow Nest to receive in and pay out transfers by 2017.
The recommendation, laid out in the ’Making automatic enrolment work’ review, follows confirmation that the restriction on the movement of benefits into and out of Nest would remain “in order to focus the scheme on its target market”. Under current proposals, the Secretary of State is required to review the policy in 2017.
The document says: “Facilitating transfers is, in our opinion, critical to the success of the reforms. Our view is that, as pension saving in defined contribution schemes becomes the norm, so should moving and consolidating pensions saving alongside changes in employment.”
It continues: “We recommend that Government undertakes a further review, in advance of the 2017 review of the restriction on transfers for Nest, to consider how transfers across the pensions industry can be made easier, so that individuals are better able to consolidate their pension savings as they changer employment over their working life.”
Legal & General pensions strategy director Adrian Boulding says: “The issue of transfers is absolutely vital. We don’t see any reason why you shouldn’t be able to pick up your pension and take it with you.”