The Department for Work and Pensions (DWP) has published a call for evidence on how defined contribution (DC) pension schemes are managed, with a view to setting out standards to protect members.
The government has asked the industry for evidence on the current state of pension scheme governance, default options, administration and record keeping.
The government is seeking views on:
- Ways to ensure that people running pensions schemes have the skills and knowledge to be able to act in members’ interests and for conflicts of interest to be properly managed.
- Standards for the design and selection of default options.
- How schemes administer members’ pension pots.
Steve Webb, minister for pensions, said: “When people choose to pay into a workplace pension few will have actively chosen the scheme they join.
“They trust the people managing their pension to be doing everything they can to ensure they receive a decent return when they retire.
“While we know standards in DC schemes have been improving, we want to make sure all pension providers have key quality standards in place to protect their members.”
Helen Forrest, head of policy and advocacy at the National Association of Pensions Funds (NAPF), added: “DC pensions are the future and if auto-enrolment is to succeed people need to be able to trust that [schemes] are of a good standard.
“Good governance is critical in driving good outcomes. However, there are some thorny issues to resolve before these proposals will work.
“For example, it is difficult to place trustee-style fiduciary duties into contract-based schemes without creating conflicts with the existing duties that providers face. But we are committed to working with the government to try and overcome some of these obstacles.”