Department for Work and Pensions
Printable version

Radical shake-up of advice to pension schemes will benefit savers and boost £1.6 trillion pension assets

A radical reshaping of financial advice services used by pension schemes for long-term investment strategies will benefit millions of savers and boost the nation’s £1.6 trillion retirement assets, under plans unveiled by the government yesterday (12 March).

Opening up the market for financial advice services used by pension schemes will help trustees get better value for money, boost members’ retirement funds and reduce employers’ shortfalls, according to ministers.

A Competition and Markets Authority (CMA) probe into investment strategy advice accessed by pension schemes found trustees were often denied clear information which would help them when weighing up options – hitting retirement incomes.

Now the government is acting to:

  • improve competition in financial advice services used by trustees of both defined contribution (used by the majority of pension savers) and defined benefit pension schemes
  • ensure better disclosure of fees and performance
  • encourage closer trustee engagement when buying such services
  • enable more effective monitoring of compliance by The Pensions Regulator

Guy Opperman, Minister for Pensions and Financial Inclusion – welcoming the CMA’s findings – yesterday said:

Changes we are proposing will have a positive impact on millions of people’s pension pots.

The market sometimes restricts trustees’ ability to find the best value for money, meaning that defined benefit schemes are less affordable and more difficult to fund while defined contribution schemes face higher costs and reduced returns for members.

We want trustees to be better equipped and engaged when accessing services which have a huge influence on decisions affecting how much their members will have to live on in retirement.

The Department for Work and Pensions plans to consult on proposals later this year.

Read the investment consultants market investigation response.

Contact Press Office

Media enquiries for this press release – 020 3267 5120

Press Office

Caxton House 
Tothill Street
London
SW1H 9NA

London Press Office (national media and London area enquiries only – not questions about personal claims) 020 3267 5144

Out-of-hours (journalists only) 07623 928 975

England and Wales (local media enquiries) 029 20 586 then 097 or 098 or 099

Scotland (local media enquiries) 0131 310 1122

Follow DWP on:

 

Channel website: https://www.gov.uk/government/organisations/department-for-work-pensions

Original article link: https://www.gov.uk/government/news/radical-shake-up-of-advice-to-pension-schemes-will-benefit-savers-and-boost-1-6-trillion-pension-assets

Share this article

Latest News from
Department for Work and Pensions

White Paper : The Scale of the Visual Hacking Risk, Implications and Prevention