Pensions Minister Steve Webb recently confirmed the planned charge cap on auto enrolment pension schemes will be set at 0.75%. Over the next 10 years this cap will allegedly take £200m from the profits of the pensions industry into the pockets of savers. While the cap will not include transaction charges, this is something which will be reviewed as part of the DWP and FCA consultation.
This charges cap, originally planned to be introduced this month, was delayed until at least 2015 after protest from pension providers.
Webb said that the government was working to improve the transparency of charges, and get an “iron grip” on pension charges, adding that “it’s time to put the saver first”.
It was also announced that from April 2016 auto enrolment schemes will not be able to pay sales commission using money from people’s pension schemes, and that they will have to stop offering active member discounts, also starting in 2016.
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