Pensions - Articles - DWP consults on draft laws to remove restrictions on NEST


 The government intends to remove the annual contribution limit and transfer restrictions on pension schemes held with the National Employment Savings Trust (NEST).

 The move will help the staff of more than 8,900 employers which currently administer their pension schemes through NEST to save more for their retirement than the current £4,600 a year cap allows.

 Under the plans, these workers will also gain the same transfer rights as members of other schemes, helping them to consolidate their savings if they wish.

 The consultation, which runs until 29 October 2014, invites views from legal advisers, pensions industry professionals, trustees and scheme managers on the draft Statutory Instruments that will remove the restrictions.

 Having secured the support of the European Commission for the changes, following a year of negotiation, the government intends to lay legislation before Parliament in the new year.

 Minister for Pensions Steve Webb said:

 "NEST has been a force for good in pensions, helping to ensure the successful introduction of the government’s automatic enrolment policy and bringing millions more people into pension saving.

 While these constraints were essential as we got auto-enrolment up and running, their removal will ensure that in future people saving with NEST get the same rights as members in other schemes and can make the most of their savings.

 Removing the contribution limit will help people save more, while lifting the ban on transfers will help people to build up worthwhile pension pots in one place and get better value for their savings."

 NEST was set up by the government to support automatic enrolment by providing a quality, low-cost pension scheme, primarily for smaller employers, in a market which at the time was deemed unprofitable by many private sector providers.

 The restrictions were originally imposed to ensure NEST focused on its target market. They were cited by the European Commission as reinforcing how government sought to minimise any competitive advantage that could be gained by NEST through its state aid.

 But reflecting changes in the market since then and the disadvantage caused to NEST savers by these 2 constraints, last year the government announced its intention to lift them from 2017. In September, the European Commission confirmed it would not oppose the move.

Back to Index


Similar News to this Story

94 percent view State Pension as an entitlement not benefit
Majority of adults aged 66+ say that Triple Lock is affordable and fair to older generations. Around one in seven rely on the State Pension to provide
Fair play off the pitch
Male players in the English Premier League earn an average of more than £3 million per year, while their female counterparts average around £47,000. T
Why Bitcoin matters to Pension Schemes
Back in November 2024, Cartwright Pension Trusts announced its role in facilitating the first-ever UK DB pension trust investment in Bitcoin. With the

Site Search

Exact   Any  

Latest Actuarial Jobs

Actuarial Login

Email
Password
 Jobseeker    Client
Reminder Logon

APA Sponsors

Actuarial Jobs & News Feeds

Jobs RSS News RSS

WikiActuary

Be the first to contribute to our definitive actuarial reference forum. Built by actuaries for actuaries.