The Weekly Wrap: February 20 edition

Details-of-pot-follows-member system announced

FT: The government has announced further details of its pot-follows-member proposals, which will automatically consolidate members' pension pots of £10,000 or less into their current employer’s scheme. The policy will apply to contributions made from July 2012 onwards.

Future Fund backs Calpers’ cuts in private equity

FTfm: One of the world’s largest investors in private equity has supported US pension fund Calpers' announcement that it will reduce its private equity managers by more than two-thirds. Future Funds’ managing director said the pension fund would benefit from working with smaller numbers. “The direction Calpers is moving is consistent with how we operate: less is more,” he said.

Cost-cutting encourages scheme insourcing

FTfm: According to a recent survey, four out of five pension funds in the UK intend to cut costs by increasing in-house management of their portfolio. On average, schemes are spending 46 basis points on external management compared with 8bp on internal investment capabilities. The change in emphasis also allows schemes to reduce agency risk through increased oversight.

Hargreaves Lansdown cuts its drawdown charges

FT: The UK’s biggest fund supermarket has announced that from April 6 it will not charge new and existing customers for set-up, one-off or regular payments, or for changes to their payments. The changes to the charging model have come in response to this year’s reforms to the retirement income market.

Data reveal 200% jump in fund selection for DB transfers

FT Adviser: Figures released by Selectapension indicate a near 200 per cent increase in the numbers of advisers selecting specific funds rather than using a default option when reviewing transfers from defined benefit pension schemes. Over the same period, those choosing to use discretionary fund managers have increased by 438 per cent.

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This week's social media comment

Standard Life's Jamie Jenkins responds to this week's Any other business feature:

Good point made here; the #pension scheme demographic is changing with #autoenrolment http://t.co/a3df1omhTM (via @pensions_expert).

— Jamie Jenkins (@pensionsguy) February 17, 2015