Pensions Minister rules out pot follows member system in current climate

Written by Talya Misiri

It is "not the right time" to implement a pot follows member system into UK pensions, Pensions Minister Guy Opperman has said.

Responding to a parliamentary written question submitted by MP for Southampton, Itchen, Royston Smith, on whether an assessment has been made of the merits of automatic transfers, Opperman said it will not be introduced in the current climate.

The Minister noted that instead, the industry focus surrounds the success of auto-enrolment and scheme managers and trustees' focus on "preparing for compliance with the authorisation and supervision regime introduced by the Pension Schemes Act 2017".

"These reforms increase the number of people saving into workplace pensions and ensure confidence in the system. Government, providers, employers and members should focus on these changes. It is therefore not the right time to implement automatic transfers," he confirmed.

Opperman highlighted that the government's current priority in 2018 is the "successful roll-out of auto-enrolment". At present over 9.4 million employees have been enrolled into a workplace pension and more than 1.1 million employers were meeting their duties as of the end of February 2018.

While pot follows member is not an option at the moment, Opperman explained that those with a DC pension are able to transfer their savings to another scheme of their choosing and "can use the Pension Tracing Service to identify pension pots they have accumulated with former employers".

Moreover, the Pensions Minister also referred to the upcoming pensions dashboard, which aims to provide all of a members' pension information in one place. " This would enable them to feel in control and take ownership of their pensions," he said.

The Department for Work and Pensions is currently working on a feasibility study on the dashboard that will be published later this spring, Opperman added.

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