While supporting the fundamental objective of putting the General Levy on a sustainable footing and ensuring regulatory bodies are properly resourced, the SPP has raised concerns over proposed steep increases for master trusts and personal pension providers. The representative body is calling on the Government to provide clear, evidence-based justification for these “disproportionate” rises.
Key highlights of the SPP’s consultation response include:
A lack of evidence for differential rises
The SPP questions the rationale for placing the largest levy increases on master trusts and personal pension providers without clear evidence that they generate a higher regulatory burden.
Cumulative regulatory pressure
The SPP states that additional levy costs arrive alongside an unprecedented wave of government-led reforms including Pensions Dashboards, Value for Money (VfM) assessments, small pots consolidation, decumulation, and market consolidation, which compounds financial pressures on the sector.
Call for consolidated transparency
To build industry confidence, the SPP recommends unified, consolidated reporting across all levy-funded bodies (The Pensions Regulator, The Pensions Ombudsman, and the Money and Pensions Service) to clearly demonstrate cost drivers, efficiency, and value for money.
Future-proofing beyond 2030
The SPP advocates for a future framework built on fairness, stability, and proportionality. It suggests exploring a split-charging structure (e.g., retaining per-member fees for guidance/ombudsman services while aligning regulatory costs with Assets Under Management) as the market continues to consolidate.
Madalena Cain, Deputy Chair of the SPP’s DC Committee, said: "The SPP fully supports steps to ensure our regulatory bodies are adequately funded in order to protect savers. However, any changes to the General Levy must be fair, proportionate, and transparent. Given the huge cumulative cost of ongoing government reforms, the government must ensure levies are carefully balanced with industry affordability. Moving forward, our recommendation to introduce consolidated reporting across all levy-funded bodies would greatly help to provide the transparency and accountability pension schemes - and ultimately savers – rightly deserve."
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