Financial analyst the Research Department says anticipation of Stakeholder pensions is galvanising the pension industry into reducing charges.
Group Personal Pension providers have started introducing schemes within Stakeholder's 1 per cent maximum annual charge.
TRD says this will greatly increase fund values in the early years of a fund's set-up.
TRD dot com Director Mark Hayes-Newington says: “Well-known companies such as NPI, Scottish Amicable, Scottish Mutual, Friends Provident and Royal and SunAlliance have already repriced their GPP policies downwards. However, there remains considerable variations between pension providers, with some apparently oblivious to the changes that are taking place around them”.