Govt 'absolutely prepared' to cap pension charges

do they understand?

It's a competitive market with many providers isn't it? Is he suggesting pension providers have a monopoly or is he trying to reign the odd expensive direct provider? Or is he just looking to score a few cheap votes?

Posted by: MarkG

Not the real problem

I absolutely love the thought of reduced management charges on pension plans. Great news for the consumer. But not the barrier to saving for the future that the Government thinks it is. If the Government truly wanted to encourage retirement savings then they would take the action that might result in this goal. Instead they will aim at the soft target of fund management charges rather than dealing with the main issues of complexity and the continually moving goal posts that the consumer and financial sector are constantly having to deal with. Having helped to destroy the best pensions provision in Western Europe politicians will continue to tinker at the edges and preside over further decline. It really is time for the Government to come up with the pensions equivalent of the MPC and stop their political meddling

Posted by: Nick Bamford

Can't Be Done

Simply. To cap charges is to cap service. Stakeholders could just about be profitable provided there were limited in-house funds. If we think there is a lack of good info to the public now, just think what would happen when a cap is put on to limit the activities of providers and those advising. We can't go there for these and more reasons too numerous to write here. Does the pensions minister actually know anything about pensions or about the fundamentals of trade and competition?

Posted by: Stu

Epic Economic Ignorance by Webb

Oh dear. Economics for dummies. Lesson 1. Price is a signal. So, as long as we have hard disclosure consumers will receive the signal. Lesson 2. Price controls destroy wealth and opportunity. For example the minimum wage on young people has resulted in mass unemployemnt among young people. Also the absolute failure of price controlled Stakeholder pensions. Lesson 3. The collapse of the Berlin Wall. Listen Webby, socialism/communism doesn't work. I recommend you read up on Ludwig von Mises. Marks for Webby. 0/10

Posted by: Steven Farrall

cap pension charges

The Government forget that a profit has to be made to provide a service etc(unless its paying their wages and expenses. Without profit, there are no investors. Everything in business that the government interfers with usually ends up with a negative position. In addition the FSA think they are a second line of government.

Posted by: terry

What a numpty!

This is the guy who a few months ago spouted off that his mother had hitherto had wonderful advice and service from her Bank - obviously charges weren't an issue then? Does he know nothing about pensions? Charges were capped with snakeholder, they didn't exactly fly off the shelves did they? The real problems are constant tinkering and moving of goalposts, affordability and constant pension bashing - as he is actually doing here. But I guess the real problems are a little tricky to solve, easier just to try and get some cheap votes.....

Posted by: Bill

Another sound bite

Please note the important part "…..if they hinder saving" And how would they prove or disprove that in any meaningful way? Nick has said it succinctly, but unfortunately politicians (being the lowest form of modern life) are hardly likely to listen let alone understand. Much preferring to grab headlines at any cost. Perhaps if ever they were to treat the subject with the sense it deserves (about as much hope as me winning the Lottery) they might decide to consult with those ‘at the coal face’ who know exactly what is needed to encourage savings.

Posted by: Harry Katz

Gov't posturing over pensions

What right does the government have to call into question the charges levied by pension providers. The State pension and its various 'add on bits' (such as SERPS, S2P, graduated contributions)represent the biggest rip off of all for people who work and pay their taxes. And politicians continue to posture whilst picking up their own hugely inflated, gold-plated pension (following on from a few miserable years spouting hot air)from the tax payer.

Posted by: Bill Wells

Meanwhile Rome burns

Approximately 1/3rd of the working population are in unfunded government backed schemes the costs of which are slowly crippling the country as the politicians fail to grasp the nettle. Another 1/3rd aren't in a pension of any sort and will retire into penury or be totally reliant on the state. Finally 1/3rd of the working population have attempted to do something about their retirement with little or no help from HMG. so finally the solution to our impending pension crisis is to .....put a cap on charges! I think politicians should look elsewhere first. Tackle the ballooning public sector pension debt, auto-enrol, provide proper incentives in a clear system that isn't continually tinkered with by short sighted politicians eager to raid the pensions of those careful enough to save. are charges important? Absolutely they are but I reckon they need to look elsewhere first. Like most politicians I've come to the conclusion that when it comes to pension planning (with the exception of their own) they are all myopic!

Posted by: stevo

If only it was as simple as charges....

I would have thought that lessons would have been learn't from Stakeholder pensions with regards to charges, the simple fact is that pensions are SOLD not BOUGHT and as they have become less attractive as an income driver for advisers (not to mention the vast reduction in adviser numbers which will continue to happen with RDR) then less of them will be taken out. People seem to find money to enjoy themselves as it is not very often I see empty City Center Pubs restaurants at weekends so it is probably more a case of priority and if we are not there to help guide clients then what do you expect!!

Posted by: Eric Shun

Hasn't he heard of NEST?

Does this man have a clue what the State's plans are for pensions? What does he think NEST pensions are if not price capped pensions backed by auto-enrolment? Clearly competition is alive and well for the post of Westminster Village Idiot.

Posted by: Michael Both