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Monday, 12 March 2012

Latest on charges as auto enrolment looms for UK employers

From: Professional Pensions Magazine

The Pensions Management Institute has thrown its weight behind efforts to make charges more transparent before the introduction of auto-enrolment.

The National Association of Pension Funds has been pushing for "clear and transparent" charges and is set to launch an industry-wide code of conduct this spring.

PMI chief executive Vince Linnane gave his backing to the NAPF code of conduct and warned that hidden charges could do "irreparable damage" to the reputation of pensions.

He said: "Security and transparency are going to be key to a successful and engaged introduction of auto-enrolment and it is imperative that members are positive about the policy from the start.

"Hidden charges and barriers could do irreparable damage to the image of auto-enrolment before it has even taken off."

Linnane said public confidence in the pensions system was vital for auto-enrolment to be a success.

He added: "The responsibility of the industry to encourage member participation also extends to boosting the level of retirement savings for these members.

"Taking money through hidden set-up and running costs, that are not explained fully to the member when they set up the policy, ultimately defeats the purpose of auto-enrolment as a tool to encourage sufficient funding for members' futures."

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