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<p>So far, the Government’s automatic enrolment (AE) programme has led to more than
9.4 million employees being automatically enrolled in a workplace pension, with more
than 1.1 million employers meeting their duties as of the end of February. We do not
routinely collect data on the number or size of individuals’ pension pots, but it
is clear that many of these pots will be small at this early stage. However, the proposals
announced in the 2017 Review of Automatic Enrolment will mean pension saving starting
from a younger age, which we know makes a real difference. A National Minimum Wage
earner who starts saving from 22 could build a pot of £82,000 (in today’s earnings
terms) by state pension age. Had they started saving at 18, that pot could be £92,000
(12 per cent larger). We will keep the issue of small pots under review now that the
roll-out of AE is almost complete.</p><p> </p><p>As of March 2017, 94 per cent of
eligible jobholders automatically enrolled in an occupational defined contribution
scheme were enrolled in a Master Trust. The authorisation and supervision regime introduced
by the Pension Schemes Act 2017 will ensure that members of Master Trust schemes,
who will often have small pension pots, have equivalent protection to people saving
in other types of pension schemes.</p><p> </p><p>Dormant pots can be eroded over time
by costs and charges, and the smaller the dormant pot, the greater the impact. Members
have the right to know all the costs and charges they are paying. The Government consulted
last year on regulations requiring charges and transaction costs to be given to defined
contribution occupational pension scheme members and to be published. We laid regulations
to achieve this on 26 February, and they will come into force on 6 April. The Financial
Conduct Authority plan to consult on corresponding rules for workplace personal pension
schemes in the second quarter of this year.</p><p> </p><p>Members could also benefit
from the introduction of the pensions dashboard, which should make it easier to see
all their pots in one place when they choose to do so. This would enable them to feel
in control and take ownership of their pensions. We are currently conducting a feasibility
study looking at how we can make the pensions dashboard a reality, and will publish
our findings later in the spring.</p>
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