Date: 13th January 2017
In a study published last year, the Transparency Task Force revealed that pension savers were hit by more than 100 charges ( often hidden) representing a third of the total amount of their pension funds over a lifetime of savings.
In order to remedy this situation, the Financial Conduct Authority in the UK has proposed several new measures to increase the transparency of the funds management. The Regulator has, among others, proposed to force the fund managers to be clearer with their clients regarding the fees applied to their pension savings. It has also recommended simplifying the charging structures so they are easier to understand for the investors.
Transparency Task Force does not deem those proposals to be sufficient. Through a petition supported by investors groups, pension professionals, unions, academics and lawyers, Transparency Task Forces asks the MEPs to open a new inquiry regarding those pensions charges to see how they impact pension savings.
BETTER FINANCE has already called attention to the fact that pension savings are subject to high level of fees and acts to improve this situation (link to Pensions report). Investors are not informed of the final amount of their pension savings after deduction of fees, taxes and inflation. Research by BETTER FINANCE shows that in many cases returns are poor and often even negative in this case.
People’s Trust, supporting the petition launched by the Transparency Task Force, believes that reforming the charging structure and the fees level could have a massive impact on the quality of life for pensioners.
BETTER FINANCE is a founding member of the People’s Trust.