The government has tabled an amendment to the Pensions Bill to require pension providers to disclose all transaction costs in defined contribution workplace pensions.
This extra information will enable those running defined contribution schemes to see exactly how much they are paying for asset management services to get the best value for scheme members, who will also benefit from greater transparency.
The reform is the latest part of the government’s drive to bring greater fairness and transparency to pension costs.
Minister for Pensions Steve Webb said:
We’re taking action to ensure consumers have access to good quality pension schemes so they have the confidence to plan for their futures. For the first time, we are shining a light into the murky corners of the pensions industry to make sure savers know what is happening to their money.
A lack of transparency around the true costs of trading can prevent schemes from securing value for money for their members. We will outline further details on our proposals shortly.
The government will publish its response to the consultation on charges, along with proposals on quality and transparency in workplace pension schemes soon. This will contain further details about the implementation and timing of the measures announced today.
Read the Written Ministerial Statement on the government’s amendment (PDF)
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