Aegon is introducing monthly fees for some active members and planning to bring in employer charges for some services as it complies with the DWP’s new rules.
Commission will continue to be paid until April 2016 for employers who have staged before April 2015, ‘at a level which reflects the revised pricing for that scheme’. All other commissions for these schemes will be removed at the point the pricing changes are implemented.
For employers with a staging date from April 2015, all commissions will continue until the staging date and will be removed at that point.
The provider says its unravelling of active member discounts will see a small number of schemes introduce a monthly employee fee, while deferred members will see their charges reduced to the active member rate. The combined monthly employee fee and AMC will meet the overall 0.75 per cent charge cap requirement. Deferred members will see their AMC reduced to the active level, but will also have a monthly admin fee imposed.
These changes follow the announcement from Aegon last April that it will apply the 0.75 per cent charge cap to all new entrants for schemes that stage from September 2014 onwards, in line with the DWP announcement on charge caps.
For employers who have staged before April 2015, the changes will apply to both new and existing members within the timeframe laid out by the DWP.
For employers with a staging date from April 2015, these changes will apply to both new and existing members, from the staging date.
Aegon says is in the early stage of plans to introduce an employer charge, where appropriate, for some services.
Aegon UK managing director, workplace solutions Angela Seymour-Jackson says: “Following the review of our existing pension schemes we can now confidently work with employers and advisers to transition to DWP compliant terms ahead of the deadlines. We will achieve this by helping employers engage with their employees for the smoothest transition and an outcome that is in their best interests and providing a proposition that both employers and employees will value.”