Pensions - Articles - IFoA comment on pension charge cap

 Nick Salter, President Elect of the Institute and Faculty of Actuaries (IFoA) comments on the announcement by Pensions Minister Steve Webb regarding the introduction of pension charge caps:

 “Today’s announcement will be welcomed by pension savers and campaigners and a charge cap of 0.75% on default funds will undoubtedly have an impact on pension saving for many scheme members. However, low and capped charges do not guarantee good pension outcomes. In this respect contributions and investment returns will continue to have a very significant impact and the further proposals to establish Independent Governance Committees, to ensure that scheme members’ interests are properly considered, may in time be viewed as an even more important reform.

 “Looking ahead, defining what is incorporated within charges, and the charges that must be displayed by pension providers, will make comparisons of pensions much simpler and that will help employers as well as individuals looking to identify the right scheme for them.”