Pension advisers accused of overcharging employers

Consultants advising employer pension scheme trustees are charging too much for their services, a consultant says.

Consultant Hamish Wilson told delegates at IFAonline's sister title Professional Pensions show that advisers charging trustees £10,000 per meeting are eroding employers' engagement with pensions.

Over-regulation and being seen to “do the right thing” has overshadowed the only important thing to trustees, which is the employer covenant, according to Wilson.

Wilson, who runs his own corporate pensions consultancy firm Hamish Wilson, said: "Why are we adding to the complexity and cost? We are focusing on second order issues when we should be paying particular attention to the primary issue - the covenant."

Wilson added trustees could easily save money and time by not getting such detailed reports, which he said were not necessary all of the time.

"Employers are really fed up. Setting up these schemes was a voluntary thing. Scant attention has been paid to the word 'willingness'," he added.

Wilson said defined contribution (DC) pensions are actually more expensive to run than defined benefit (DB) but employers have been so dissuaded from DB there is no turning back.

He said trustees should demand "proportionate responses to their problems" from their advisers, in order to lower costs and make sponsors more willing to keeping schemes open across the board.