Pensions minister Steve Webb (pictured) hinted that the government is to take a tough stance on pension charges in an upcoming consultation, which will respond to the Office of Fair Trade’s (OFT) paper on the defined contribution (DC) pension market.
During a speech at the National Association of Pension Funds’ (NAPF) annual conference in Manchester on 17 October, Webb said: “It’s not that we’re going to get tough on charges, but enjoy your dinner tonight.”
He said the consultation will tackle the issue of excessive charges and will ask the question: Does transparency and governance get us all the way?
Webb also outlined a range of upcoming landmarks on the pensions horizon, including:
- The publication of a new paper on defined ambition pensions, which will include feedback from conversations with employers and the industry.
- The publication of legislation on pot-follows-member pensions before Easter 2014.
He also ruled out any restructuring of the pensions regulatory regime and said that the current decumulation model will not work post auto-enrolment. “We need to think of new ways to deal with decumulation,” he added.
Webb compared his current view on the pensions landscape to two songs from Les Miserables, one of which was ‘I Dreamed A Dream’. “2013 was a turning of the tide in pensions,” he said. “It was the first year in my lifetime when there are more people in workplace pensions than not. This is my dream.
“The challenge is to take this year when the tides changed and drive it into the future. This is a once in a generation opportunity to get pensions right.”