Employer changing Pension provider

quirkyusername_2

Our employer notified all relevant employees within our company that they are changing our Pension provider next Monday April 1st. Some people have been with the current provider for many years and are not happy with this. We only found out about this yesterday through the post to our home addresses.

A few questions if I may.

Can they do this as such short notice?

We have had no consultation and the first we hear about this is a letter in the post to our home address, is this allowed?

Can we refuse to move and stick with the original provider as some people have built up quite a high current pension value?

If anybody could add further advice on this it would be most appreciated.

MallyGirl

DB or DB?
If DC, what does it say in the letter - will current pensions be moved to equivalent funds with the new provider or will you get to choose to keep the old one then start paying into the new one from this month?

quirkyusername_2

DC


Letter says no action needed to be taken and change will happen automatically. New provider will replace current provider from April onwards. If you wish to transfer existing pension account to new provider we can contact new provider to arrange this but no obligation to do so.


Hope that is enough

Linton

So what is the problem? As long as the employer continues to make their contribution and the new provider has appropriate investment choices why does it matter? Certainly the pension trustees can change provider as they deem fit. Perhaps the new one has lower charges or a better investment choice.

quirkyusername_2

Linton wrote: »

So what is the problem? As long as the employer continues to make their contribution and the new provider has appropriate investment choices why does it matter? Certainly the pension trustees can change provider as they deem fit. Perhaps the new one has lower charges or a better investment choice.

The problem for me is I am happy where my pension is now having been with the same provider for over 30 years so it has a sizeable value with bonuses etc and has increased sizeably the last few years and I would like to see it continue that way. This information has come out of the blue with less than a week before it is changed. If the new one does have lower charges or better investment choices we don't know that.


Would it not be better if the contributions were made into the current sizeable pension pot than having to start afresh with the new provider?

Prism

Having one large pension pot or several smaller ones makes little difference over all. As long as each provider offers similar funds. The original fund will stay invested and keep on growing. This can happen several times during employment (my sister is on here third in four years with the same company), and certainly if you change jobs.

Linton

quirkyusername wrote: »

....
Would it not be better if the contributions were made into the current sizeable pension pot than having to start afresh with the new provider?

It doesnt matter whether you have one pension or several. Many people coould have say 5 or 6 from different jobs. If needs be you can always merge them into another pension at some later date. Most employers dont make contributions into different pension schemes. The extra admin and possible changes to software could make it unnecessarily expensive.


I suggest your best option is to familiarise yourself with the options available under each pension scheme and make a rational decision as to whether to keep the old pension where it is or transfer it to the new one. Perhaps you could ask your employer to pay for independent advice.

Brynsam

quirkyusername wrote: »

Would it not be better if the contributions were made into the current sizeable pension pot than having to start afresh with the new provider?

Why would that be better - what do you think the advantages would be?

zagfles

How many employees? If over 50, they should consult on changes to future arrangements, see https://www.tpr.gov.uk/-/media/thepensionsregulator/files/import/pdf/employer-duty-to-consult-on-scheme-changes

Might be worth calling the pensions regulator and see what they say? Or take it up with your union if you're in one.

quirkyusername_2

Brynsam wrote: »

Why would that be better - what do you think the advantages would be?

As I'm sure you are aware I don't fully understand much about pensions but I thought one advantage would be the longer you was the same provider then as time goes on the bonuses increase greater. For example in recent years the difference between the contributions I have made and the pension value has increased year on year so was thinking the same would continue as each year goes on.

quirkyusername_2

Linton wrote: »

It doesnt matter whether you have one pension or several. Many people coould have say 5 or 6 from different jobs. If needs be you can always merge them into another pension at some later date. Most employers dont make contributions into different pension schemes. The extra admin and possible changes to software could make it unnecessarily expensive.


I suggest your best option is to familiarise yourself with the options available under each pension scheme and make a rational decision as to whether to keep the old pension where it is or transfer it to the new one. Perhaps you could ask your employer to pay for independent advice.

I have worked for the company for over 35 years and had the pension for just over 30 years so it is the only pension I have. I would have preferred the opportuntity to familiarise myself with the options under each pension scheme if we had more notice or been consulted about this but it seems we are having no choice about all this and the change is being made now as in we are with the new pension provider from next Monday.