Automatic transfers consolidating pension savings
The automatic transfers rules are set to be applied to the largest pension schemes from October 2016, with other pension providers being placed subject to the new regime some time thereafter.
Automatic transfers will be facilitated through a system of 'matching' any old pension pots with individuals who have changed jobs.
This will make it easier for people to keep track of their pensions saving, plan better for their retirement and secure a better income in retirement.Chapter 1 explains the context for change and our work to date.Following our formal consultation, this paper sets out the background to our policy thinking and our proposals on how a system of automatic transfers would work in practice."When a worker moves to a new employer, the new scheme will need to check a 'network of interoperable registers' to see if there is a small pension savings pot which might qualify for transfer," said pensions expert Tom Barton of Pinsent Masons, the law firm behind "Pension schemes will need to populate these registers with data about workers and their pension pots.Since then we have been taking forward work on how we might design and deliver our policy and have been talking to a wide variety of people, including pension providers, third-party administrators, consumer representatives and employers. We have made good progress and this Command Paper will set out in more detail how a system of automatic transfers might work in practice.11 February 2015 This publication sets out proposals for a framework for the automatic transfer of pension pots when people change jobs.Reform of the UK’s pension system is already well under way.Last year saw the introduction of automatic enrolment, confirmation of our plans to fundamentally reform the state pension, and the publication of our strategy for reinvigorating private pensions.Savers will initially be asked to opt-in to the consolidation of their pensions pots scheme.However, once automatic transfers are "fully operational" they will be facilitated on an opt-out basis.