Pensions Trust, the independent multi-employer trust, today unveils reduced charges for low earners and deferred members.

Morten Nilsson, Chief Executive of NOW: Pensions, said: “We believe everyone deserves a better pension and therefore have developed a strong pricing model that is clear and transparent. We have decided to make a few adjustments to secure best value for those who earn less than £18,000 p.a. and those with small pots who defer their pension for any reason. These people would have been disadvantaged by our original pricing structure especially with the delay of the phasing of auto enrolment and this may have discouraged them from saving.”

“Our model is clean and without any forms of hidden charges and our analysis shows that this new adjusted pricing model makes us very competitive for any member in all reasonable scenarios. We are very proud of being able to deliver such a high quality fund at these costs. This is only possible because of our close partnership with Xafinity Paymaster.”

The adjusted charges will be as follows:

  2012 October 2017 October 2018
Statutory minimum contributions 2% 5% 8%
Member charge: Low earner (<£18,000 p.a.) £0.30 administration charge per month plus 0.3% annual management charge £1.00 administration charge per month plus 0.3% annual management charge £1.50 administration charge per month plus 0.3% annual management charge
Member charge: standard £1.50 administration charge per month plus 0.3% annual management charge
Member charge: Deferred The lower of 0.5% or £1.50 + 0.3%.


The adjustment to the fees means that people earning e.g. £18.000 p.a. will until October 2017, pay £3.60 in administration charges per year. Their yearly contributions will be £360. This allows them to build up their savings and get to higher contribution levels before the slightly higher administration cost applies. After October 2017, once the statutory minimum contributions have increased, their annual contribution will be £900 and most members pension pots will have started to build up they will then pay £12 per year in administration charges. Once auto enrolment is fully phased in they will pay the regular fee (£18 p.a.), but by then the annual minimum contribution will be £1440.

NOW: Pensions is committed to developing a better workplace pensions provision in the UK by offering a simple, systematically risk managed, cost efficient and high performance pension product that delivers better retirement savings for UK employees. With over 45 years experience providing Denmark’s working population with stable and consistent pensions returns, NOW: Pensions is set to transfer the knowledge acquired in Denmark to the UK pension market ready for auto-enrolment in 2012.

Nilsson concluded: “Auto-enrolment aims to ensure all employees in the UK are provided with a pension in retirement. We cannot stress enough the negative impact that high costs and poor performance has on a person’s pension pot – our calculations show that our charges compared for example to a charge of 1.5% AMC mean more than 30% difference in pension pot, after 40 years of saving. That’s why we are committed to providing employers and employees with value for their money, and low charges that are transparent and clearly articulated.”