Government confirms delay to pension charges cap

Pensions minister Steve Webb has confirmed that the introduction of a pensions charge cap will be delayed by a year until April 2015.

The charges cap was due to be introduced in April 2014. 

A ban on active member discounts and defined contribution reforms on governance and transparency will also be delayed by a year.

In December, the Regulatory Policy Committee at the Department for Business ruled that the DWP’s impact assessment on a pension charges cap was ‘not fit for purpose’.

Webb (pictured) said: “We remain strongly minded to cap pension scheme charges in the default funds used for automatic-enrolment.

“However, we have consistently encouraged firms to start getting ready for automatic-enrolment twelve months ahead of the time the new employer duties apply to them.

“Therefore, to give those employers at least twelve months notice of the rules that will apply to them; I can confirm that any cap on charges will not be introduced before April 2015.”