The National Association of Pension Funds (NAPF) has launched a benchmark scheme for defined contribution pensions.
From 2009, employers who offer defined contribution (DC) pensions will be granted the Pension Quality Mark, if their scheme is up to standard.
Successful employers will then be able to use the logo on pension scheme literature and in job advertisements to advertise the value of their fund.
Addressing delegates at NAPF’s annual conference in Glasgow, chairman Chris Hitchen said: “The Pension Quality Mark is an important new development which will benefit both employers and employees. It is a simple benchmark that employers can use to demonstrate the value of their pension both to current and to potential staff.
“It will also help employees to understand more about their employer’s pension arrangements. I am confident that Pensions Quality Mark can play an important part in promoting retirement saving through the workplace.”
The scheme will be governed by an independent board of key stakeholders including representatives of employers, members, pension providers and relevant experts.
To qualify, pensions must make the grade in three core tests. Communication and governance will be tested alongside contributions, which must be at least 10%, with 6% paid by the employer.
The total 10% contributions can be achieved through fixed rate contributions as well as more complex structures such as age-related or matching contributions. If contributions are 15%, with at least 10% from the employer, then schemes can apply for a Pension Quality Mark Plus.
Approximately five million people are saving in schemes involved, which include occupational DC schemes, group personal pensions, group stakeholder pensions and, from 2012, Personal Accounts.