Legal and General is to cap the charges for auto-enrolment pension schemes at 0.5%.
The charge is to cover both the annual management charge (AMC) for administration of a defined contribution (DC) pension and the charge for Legal and General’s default fund, Multi-Asset Lifestyle Portfolio.
Employers, and their employees, that select Legal and General’s auto-enrolment pension scheme and its default fund from 9 September will have a total charge that does not exceed 0.5%.
Existing employer clients will be offered the same deal.
John Pollock, chief executive officer at Legal and General Assurance Society, said: “We have long been advocates of value for money and have avoided opaque charging structures such as active member discounts.
“Ahead of the government’s forthcoming consultation on maximum charges for auto-enrolment schemes, we have made our position clear that no employees saving in a workplace pension scheme should have to pay more than half a percent a year of their retirement savings pot.”