17 October 2012
A Government plan designed to help people transfer their pensions to new employers could actually lead to savers losing substantial sums from their pensions, it is claimed.
A joint letter sent to the Daily Telegraph by various organisations argues that the change could result in pensions being transferred from good schemes with low fees to poorly performing schemes with higher fees.
In effect it would mean pension holders might not get the best deal on their pensions when they retire, the signatories to the letter believe.
They instead called for low-cost "aggregator schemes" to be introduced that would enable pension holders to pool their retirement savings in one place, meaning rates and fees would be transparent and potentially benefit people by as much as 25%.
The letter was signed by National Association of Pension Funds chief executive Joanne Segars, Age UK charity director general Michelle Mitchell, TUC general secretary Brendan Barber and Which? chief executive Peter Vicary-Smith.
They spoke out after the Government outlined its plans to make it easier for employees to take their pensions with them when they move into new jobs.
Copyright Press Association 2012
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