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Protecting Small Pension Pots

Since the introduction of pension
auto-enrolment, the percentage of eligible workers enrolled in
workplace pensions has grown from 55% to 88%; with 10.6 million
employees now saving into auto-enrolment schemes. As a result, over
the ten years since its introduction the scheme has seen a rise in
pension savings of more than £28.4 billion per year.

However, employees who have either changed jobs on a regular basis or have
taken on a number of short term contracts may have built up a number
of small auto-enrolment pension pots over time. To help to protect
those pots the Government has laid legislation before Parliament
which will prevent flat fees from being taken on auto-enrolment
pension pots worth less than £100. The ban, which comes into effect
from April 2022, will apply to both active and deferred pension pots.

This is the first step in tackling the problem of multiple small pension
pots with the Government consulting with pension providers on further
measures.

If you are looking for advice on pensions, or if your situation has
changed and you may therefore need to review your existing pensions
or investments, contact Beckworth by using one of the links on our
website.