The DWP has published ‘Better workplace pensions: Putting savers ‘interests first’. The document addresses 3 key areas:

Qualifying Pension Scheme Charge Cap

  • The charge cap has been set at 0.75% per annum of a member’s ‘fund’
  • Applies from 6 April 15
  • Applies to all qualifying workplace pension schemes
  • Applies only to the scheme’s default investment solution

 Occupational Pension Scheme Trustee Governance

Legislation requires trustees to:

  • Appoint a chair of trustees
  • Have a statement of investment principles and regularly review the default solution in line with it.
  • Ensure transactions are processed promptly and accurately
  • Assess charges including transaction charges and ensure value for money
  • Ensure trustee knowledge and understanding is maintained
  • Produce an annual Chair’s statement detailing how the above requirements have been met
  • Trustees must have the power to appoint any service provider. Current restrictions will be overridden
  • Master Trusts must have a minimum of three Trustees with a majority independent
  • Applies from 6 April 15 , with 3 months to comply

 Commission, Consultancy Charging and Active Member Discount Bans

  • Commission ban 6 April 16: No commission can be paid from qualifying pension schemes from 6 April 2016 and any commission paid in 2015/16 must be accommodated within the 0.75% charge cap.
  • Consultancy charge ban 6 Apr 15 for Group Personal Pensions and 6 April 16 for Occupational Trust Brust schemes: Consultancy charging (where advisers deduct the cost of their services from the scheme member’s policy) was banned for new qualifying schemes from May 2013. This brings all schemes set up on this basis prior to May 2013 into line.
  • Active member discount ban 6 Apr 16: Active member discount charging (where scheme members who maintain contributions receive a discount on their policy charge compared to those that stop making contributions) will be banned unless the employer covers the cost of the discount for those members not making contributions.


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