The government has put plans to implement defined ambition, collective benefits, and automatic transfers on hold to be revisited at a later date.
The aim of the automatic transfers process, also known as pot follows member, is to enable members to more easily keep track of their pension savings as they move between employers and amass multiple pension pots.
Meanwhile, defined ambition seeks to offer a middle way between defined contribution and defined benefit pension schemes to provide more certainty for individuals in terms of final outcomes, while spreading risk and reducing cost volatility for employers.
The policies have been delayed in order to allow the pensions industry, employers and scheme members to adjust to existing changes in the pensions landscape, including auto-enrolment, the pension freedoms that came into effect in April 2015 and the new state pension that will come into play from April 2016.
In a statement to the House of Commons, pensions minister Baroness Ros Altmann, said: “The time is not right to ask the pensions industry to absorb the new swathe of regulation that would be needed to make such further reforms work effectively.”
Speaking at the National Association of Pension Funds (NAPF) Annual Conference and Exhibition 2015 (now the Pensions and Lifetime Savings Association) on 15 October, Altmann added: “I am conscious of the huge amount of reforms already underway and I have had to make some strategic and tactical decisions. These are decisions primarily about timing rather than policy itself.”
David Fairs, chairman of the Association of Consulting Actuaries (ACA), said: “[The delay to defined ambition] prevents insurance providers and investment managers creating new flexible products that would have been possible under this legislation.”
Chris Curry, director at the Pensions Policy Institute, added: “[Putting on hold] automatic transfers means that the problem is still going to exist of individuals who are potentially losing track of their pension pots, which may not be the most cost-effective way of them managing their retirement, so there will need to be further work done to enable people to make sure they still have access to everything that they have saved or their employers have saved on their behalf.”