Pensions minister Steve Webb says there will be no “screeching U-turns” over the Government’s pension charge cap plans but admits its original timetable may have been unrealistic.
It emerged last week the Government was likely to delay the introduction of its charge cap, originally due this April, by at least a year.
Speaking at a Headlinemoney dinner in London this week, Webb said: “I have read the odd headline about screeching U-turns and I don’t recognise this. Clearly people have spoken to us about timing and it’s worth bearing in mind we have told firms to prepare for auto-enrolment at least 12 months ahead of doing it and we have had some feedback on our suggestion that we make some changes 12 weeks ahead of doing it, which were reasonable things that we will have to reflect on.”
Webb is expected to update Parliament on 23 January on his charge cap plans.
Legal & General pensions strategy director Adrian Boulding says the Government could make it easier for employers to move scheme members from old, high charging schemes to new schemes.
He says: “To get a contract-based scheme moved across to a new lower charge scheme you need individual member signatures on each transfer. We will see some push on that and the Government may even look to rewrite the legislation to make that process easier.”
Syndaxi Chartered Financial Planners managing director Robert Reid says: “The big problems when it comes to high pension charges are in legacy schemes although any reform will inevitably be complicated.”