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Stakeholder pensions are a low cost, flexible and secure option for people who do not already have access to a pension arrangement.
The Government wants people who can save for retirement to do so. Stakeholder pensions are designed for people without access to employer sponsored pension arrangements. They are secure, flexible and offer value for money. They will provide the opportunity for many more people to save for retirement in a way they can afford.
Employers who have 5 or more employees must offer access to a stakeholder pension scheme. If any employees join the designated scheme, the employer must offer a payroll deduction facility to those who want it.
The Pensions Regulator are responsible for regulating the requirement for employers to give access to stakeholder schemes.
Employers must pay employee contributions to schemes within a specified timescale, and the Pensions Regulator will be responsible for dealing with any reports of late payment of contributions by employers.
If a stakeholder manager or trustee does not receive the expected amount from the employer on the date it is due, they have a statutory duty to report the matter to the Pensions Regulator.
The Pensions Regulator will monitor reports of late payments and will take appropriate action against the employer where necessary.
In certain circumstances, you may be exempt from the requirement to provide access to a stakeholder scheme for your employees. You may be exempt if you;
If you have an occupational scheme or an arrangement with a personal pension provider (often called a group personal pension scheme), check with the provider of the scheme to find out if it meets the conditions for being exempt.
You may not have to provide access to a stakeholder pension for all of your employees. You do not have to provide access for any employee:
You can read or print a copy of Stakeholder pensions - a guide for employers for more information.
Stakeholder pensions could be a good option for people who currently earn more than around £10,000 a year. However, they are available to almost everybody, including people in employment, fixed contract workers, the self-employed and people who are not actually working but can afford to make contributions. It’s also possible to contribute to someone else’s stakeholder pension - for instance someone can make contributions to their non-working partner’s stakeholder scheme on their behalf.
Who regulates the stakeholder pension schemes?
The Financial Services Authority (FSA) will regulate the marketing and promotion of all schemes including any occupational pension schemes that are set up as stakeholder pension schemes.
Financial advisers must keep to the rules laid down by the Financial Services Authority (FSA) and must state which organisation regulates their work.
The Pensions Regulator and the FSA will liaise closely, to ensure that stakeholder schemes are run according to the rules.
Once someone has joined a stakeholder pension scheme, the trustees or stakeholder manager must provide them with regular information. This information will include an annual statement detailing how much has been paid in and how the individual’s fund is progressing. It may include a forecast of the likely pension on retirement.
Your first step is to choose a stakeholder pension scheme from the list of providers registered with the Pensions Regulator. The financial services companies who provide stakeholder pension schemes must first register with the Pensions Regulator.
You can view the register by clicking here: The Stakeholder Register
TPAS operates a national telephone helpline on:
Calls are charged at the local call rate.
The Pensions Advisory Service (TPAS), is an independent non-profit organisation that provides information and guidance on the whole spectrum of pensions covering State, company, personal and stakeholder schemes. We also help any member of the public who has a problem, complaint or dispute with their occupational or private pension arrangement.
Formed in 1923, the National Association of Pension Funds is the leading UK body providing representation and other services for those involved in designing, operating, advising and investing in all aspects of pensions and other retirement provision. NAPF’s aim is to be the leading voice of retirement provision through the workplace.
The Government has set up The Pension Service, which is part of the Department for Work and Pensions. It has been set up to improve the service you receive, whether you are already a pensioner or are planning for your retirement, no matter how far off it might be.
For more information on the register of stakeholder pension schemes, you can call the Pensions Regulator on 0870 6063 636, Monday to Friday from 8.30am to 5.30pm.
The Pensions Regulator
Napier House
Trafalgar Place
Brighton
BN1 4DW
