Pensions - Articles - Hymans Robertson on NEST transfer restrictions

 Following the results of the Work and Pensions Committee to remove the contribution and transfer restrictions on NEST, Lee Hollingworth, Head of DC, Hymans Robertson, commented:

 “The select committees recommendation to remove the contribution and transfer restrictions currently placed on NEST is entirely sensible. This is a critical time for NEST as it attempts to secure new client wins, the current rules place them at a competitive disadvantage compared to all other DC providers. There has never been a strong rationale for having the current restrictions and many employers we have been working with have discounted NEST as an option due to these limitations. The auto-enrolment pension reforms will benefit from having a successful NEST proposition serving the market.

 We feel that the call for greater transparency in respect of member charges is a bit of misnomer – in our experience the majority of DC schemes have already moved to a mono-charge basis operating as a percentage charge deducted from the members fund. Competition between providers means that there has never been a better time to re-negotiate terms. We also now have a recognised industry benchmark set by NEST at an equivalent charge of 0.5% per annum levied against the members fund.”