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What is the charge cap?

The charge cap is a government-set limit. It’s the annual amount that can be charged to savers in default arrangements within defined contribution pension schemes used for auto-enrolment. Default arrangements are the investment fund or funds that an employer or scheme trustee have chosen for members who haven’t actively chosen a fund. The default arrangement for members of The People’s Pension who haven’t made an active choice is the ‘balanced’ investment profile.

The cap has applied since April 2015 and is currently set at 0.75% of funds under management within the default arrangement, or an equivalent combination charge. The cap applies to all scheme administration and investment charges, excluding transaction costs. This means it doesn’t currently include costs that are incurred by the investment manager when assets are bought, sold or lent by the fund.

What are my employees’ charges?

There is an annual management charge made up of 3 elements:

  • a management charge of 0.5% of the value of their pension pot each year
  • a potential rebate on the management charge of between 0.1% on savings over £6,000 and 0.3% on savings over £50,000
  • an annual charge of £2.50 deducted during the scheme year (which runs from 1 April to 31 March), if they have investments with us as of 1 April.

Find out more about our member annual management charge.

What annual management charge (AMC) do my employees pay?

There is an annual management charge made up of 3 elements:

  • a management charge of 0.5% of the value of their pension pot each year
  • a potential rebate on the management charge of between 0.1% on savings over £6,000 and 0.3% on savings over £50,000
  • an annual charge of £2.50 deducted during the scheme year (which runs from 1 April to 31 March), if they have investments with us as of 1 April.

Find out more about our member annual management charge

What are my employees being charged?

There is an annual management charge made up of 3 elements:

  • a management charge of 0.5% of the value of their pension pot each year
  • a potential rebate on the management charge of between 0.1% on savings over £6,000 and 0.3% on savings over £50,000
  • an annual charge of £2.50 deducted during the scheme year (which runs from 1 April to 31 March), if they have investments with us as of 1 April.

Find out more about our member annual management charge.

Is there a conflict between what intermediaries and advisers provide for their employer clients and what The People’s Pension offers them?

We don’t think so. Intermediaries and advisers (i.e. financial advisers or business adviser such as an accountant, bookkeeper or payroll professional) are the experts on their bit of the process, and we are the expert on ours. Our job is to make advisers’ life easier so that they can get on with what they do best.

We’re not trying to do advisers’ job for them, we want to work with them to offer the best possible service and support proposition to their clients.

What will employers get for their money?

The one-off set-up charge allow us to offer smaller employers the support they’ve told us they want and need on an ongoing basis. That includes access to personalised support from our UK-based call centre, and to our simple and hassle-free online systems. Our new solution contains everything smaller employers need to make sure they’re compliant with the law.

The People’s Pension offers the complete pension package to meet the unique needs of any organisation, large or small, in any sector. Hear why Debra Hayes, Group Pensions Director at Rentokil chose us and her great experience of our support:

Find out more about why you should choose us

Why are you charging employers who sign up to The People’s Pension?

We know that small businesses need simple tools, phone-based support during set-up and when making contributions for the first time, a simpler ‘meet the legislation’ process. Putting a one-off set-up charge in place enables us to offer smaller employers all the support they’ve told us they want on an ongoing basis.

How does an employer pay the initial one-off set-up charge?

An employer pays the one-off set-up charge by Direct Debit, debit card or credit card on our website during the sign-up process.

If the employer has obtained a reduced rate code from an intermediary or adviser (i.e. a financial adviser or business adviser such as an accountant, bookkeeper or payroll professional) the employer will need to enter this before making the payment.

 

Can you guarantee not to increase your charges in the future?

The provider of The People’s Pension, B&CE, has 30 years of experience delivering large-scale pensions to the construction sector (and the mass market since the beginning of automatic enrolment in 2012). Using that experience and combined with research B&CE conducted, we established that small businesses want and need a great deal of support in meeting their automatic enrolment duties. At The People’s Pension we know and understand these needs and we want to be able to continue to support employers of any size from any sector and provide a simple and hassle-free workplace pension.

The one-off set-up charge is exactly that – one-off. The charge allows us to offer smaller employers all the support they’ve told us they want and need on an ongoing basis.