View more on these topics

Pensions Regulator switches focus from DB to DC schemes

The Pensions Regulator says it will be focusing on promoting higher standards for defined contribution pension schemes in the run up to 2012 and the introduction of personal accounts.

This marks a switch in focus from defined benefit schemes and TPR says it aims to improve the standards of pre-retirement processes and member contributions for those in DC schemes.

It also says it will enforce better practice if necessary.

TPR chief executive Tony Hobman says: “It is more important than ever in these challenging economic times for members to make the right decisions to maximise value for money at retirement.

“We know that our work on DC will enable trustees, employers, advisers and providers to improve the outcomes for DC scheme members.

“In the run-up to 2012 we are focusing on providing more education to assist employers with their pension provision and are looking at the standards in key processes for DC pensions. We are willing to enforce better practice, if we need to.”

Standard Life head of pensions policy John Lawson says: “The Pensions Regulator is demonstrating that it aims to get to grips with DC schemes, particularly trust-based schemes that are failing to ensure that members choose the right annuity at retirement and get the best deal.

“Improving member engagement is absolutely key to making DC work. Reviewing the quality of administration, investment returns and charges on a regular basis can help members maximise their retirement funds.”

Scottish Life head of pensions strategy Steve Bee says: “This new campaign from the regulator of occupational schemes has two main thrusts; first it’s aiming to ensure that all members of trust-based occupational DC pension schemes are aware of their options on retirement, particularly the option to purchase an annuity on the open market; and secondly it is looking to get employers to engage more with pension provision.

“The first point there is really welcome I think. I’ve said many times that if people saving in pension schemes get advice on their options at only one point in their lives it should be at the point of retirement. That’s the point where so many of us make the choices that will affect our income for the rest of our time on the planet. The choices made at that point in life are irrevocable; buying an annuity is a one-way ticket to the end of your life, with no refunds.”

Recommended

Proof positive

I enjoyed and endured a recent appointment in equal measure. My clients are a 65 and 60-year-old couple running short of finances to finalise the refurbishment of their home. I had been working with them for three weeks before I met with them to answer their last questions and complete paperwork.

Iain Chadwick

The Budget 2015: a brief overview

Following George Osborne’s delivery of his sixth Budget as chancellor and the last of this current parliament, we have provided a brief overview of the initiatives put forward in his statement, focusing on the topics that have an impact upon the pensions landscape, savings, personal taxation and businesses.

Newsletter

News and expert analysis straight to your inbox

Sign up

Comments

    Leave a comment