The Government is under increasing pressure to include a new Pensions Bill as part of the Queen’s Speech later this week.
Work and Pensions Committee chair Frank Field wrote to chancellor George Osborne in early May to press the case for better regulation of the market, and in particular, the master trusts which provide multiple employers with occupational pensions schemes.
In particular, Field raised concerns that requirements around the establishment of master trusts are sufficiently lax that a collapse could put the retirement savings of large numbers of workers at risk.
Since then, the Work and Pensions Committee has re-stated its case through its report into automatic enrolment, which called for a bill with specific provisions for minimum financial and governance standards.
Former pensions minister Steve Webb, now director of policy at Royal London, today said he believes such a Bill is in contention for the Queen’s Speech on Wednesday.
Webb yesterday accused the government of being too “hands-off” with in pushing for a pensions dashboard, and has now argued that a Bill focused on master trusts risks being too narrow, and ignores the chance to force pensions providers to supply data to a pensions dashboard, or bring the self-employed into automatic-enrolment.
“Whilst the government’s plans to legislate to protect savers in small Master Trust arrangements are welcome, this Bill could be a missed opportunity if it does not address some of the more fundamental issues of inadequate pension saving,” Webb says.
Hargreaves Lansdown’s head of retirement policy Tom McPhail added: “Looking after individuals’ retirement savings is a responsibility which demands robust safeguards and controls. The process of setting up and running some types of pension scheme, such as Master Trusts is very light, with relatively little scrutiny of the individuals involved or the financial resources standing behind them. Recent high profile final salary scheme problems illustrate that the governance of workplace pensions generally is in need of review.
“This would be an opportune moment to raise the bar on workplace pension standards generally and to reassure the public that their retirement savings are in safe hands.”
A Department for Work and Pensions spokesman declined to comment.
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