Nest a turn-off

The restrictions on transferring pension pots to the National Employment Savings Trust (Nest) and contribution caps are a turn-off for many employers.

The admission was made by Laurence Churchill, its chairman of trustees, at the OPDU annual conference. He said pensions minister Steve Webb would be reviewing such restrictions to increase the scheme’s efficacy.

Despite this, Nest has seen 50 employers go live so far, with a further 50 due to go live by June.

In his speech, Churchill said Nest was also in talks with a few of the 10 large employers going live in the first auto-enrolment staging dates in October.

It is also talking to a larger number of the 120 employers that will be live by easter 2013.

Churchill revealed any such tie-ups are likely to be joint deals with pension providers to service different ranks of employee.

Nest is currently making a series of presentations to employers in conjunction with most of the big insurers.

Providers such as Standard Life are of the belief that many low-paid employees auto-enrolled for the first time may be better served by the simple, low-cost provision offered by Nest.

Churchill said these joint platforms offered better value for employers and members.

He also welcomed the competition brought to the market by Nest-like schemes such as Now Pensions and the People’s Pension from B&CE. “It is good to see competition come in – competitive tensions produce better outcomes,” he said.