Chief among the changes is a charge cap of 0.75% from April 2015, the banning of commission from April 2016, an end to active member discounts from April 2016 and a new approach to scheme governance.
You can download a copy of the DWP command paper from their website
At Aviva, we made the decision to implement a number of these measures early, so that employees can start benefitting from them sooner. You can read full details of what we plan to do in our ‘Changes to our workplace pensions’ guide, but in summary we’re making the following changes to existing workplace pensions:
31 October 2014
We removed AP initial commission.
28 November 2014
We removed transfer/single initial commission and LAUTRO initial commission.
1 December 2014
We capped scheme charges at 0.75% - any schemes with higher annual scheme charges will have them reduced.
We removed active member discounts (AMDs) and adjusted customer annual fund charges accordingly.
6 April 2015
We've replaced any existing default funds* which could breach the 0.75% charge cap.
* a default fund according to DWP definitions.
We started charging some employers and 'employer pension charge' so that we can continue to run their schemes at a reduced scheme charge.
The Financial Conduct Authority (FCA) has introduced new rules which means that workplace pension providers must establish an Independent Governance Committee (IGC). They will have a duty to act in the interests of relevant scheme members. We've created a customer site to explain the IGC's duties to your clients.
We recognise that some of the DWP’s measures will be challenging for advisers. So while we removed some types of commission in 2014, we’re keeping ongoing commission in place until its ban in April 2016 where we can. However, we might need to remove fund based commission in stages for some schemes. You can find out full details of our plans to remove commission in our ‘Commission and charges transition’ guide.