Government moves a step closer to collective defined contribution

The pensions minister backed a motion by Janice Turner, chair of the Association of Member Nominated Trustees, at last weekend’s Liberal Democrat spring conference in Gateshead, which called for “radical redesign” of DC schemes.

Turner, also a prominent Lib Dem, said the move – carried almost unanimously by party members, including Webb – was a vote in support of CDC.

The proposal would see members of schemes pool their money, rather than be divided into individual pots by each member. It is currently illegal.

Turner said she is “beginning to lose count of the number of people who are choosing not to save for a pension at all because they have lost confidence in this system”.

Her motion also noted “with concern” the “proliferation of a multitude of local government pension schemes (LGPS) with their costly duplication of administration costs, fees and charges, and inadequate regulations to ensure member-nominated representatives on all LGPS boards”.

This suggests the minister also favours moves for pooled provision-tendering among LGPS funds, and possibly a rationalisation of the funds themselves.