Commenting on the concluded DWP Consultation ‘Permitted charges within Defined Contribution pensions schemes’ Michael Ambery, Partner says:

“We are pleased to see that today’s Consultation, Permitted charges within DC pensions schemes, has protected small pension pots from erosion and becoming worthless. This commitment will protect those with relatively small pots having these diminished by investment charges. However, we question whether this goes far enough, and believe £100 remains a very small protection value and relatively insignificant in respect of the de minimis level. This level could have been much larger and should be reviewed for relevance to afford pension savers much greater protection. We remain concerned that the operational impact of changes to protect members leaves the administration and provider teams little time to ensure protections are in place.

“We would welcome the consideration of the consolidation of small pension pots and how processes might be put in place for the consumer to be protected, and have improved outcomes, during their entire working lifetime. We hope this will follow in due course and eagerly await further thoughts on Universal charging structure with the potential that this may lead to an explosion within the DC pension marketplace.”