Company DC pension transferring to new provider

Roborovski

I have £230k in my previous employer's pension plan. It is managed by WTW and has been performing well since I left 5 years ago. I have just received a letter from my ex-employer stating that from 2nd April my pot will be moved to a new scheme managed by Standard Life, unless I take steps at my own expense to move it elsewhere before that date. I have received no justification for why this is happening, and it will cost me more in management charges for probably a much lower return (SL pensions don't seem to have performed very well in recent years). There has been no correspondence from the Trustees, which seems strange, and the timescales seem unreasonably tight. Is this all quite normal with company pension funds? Are there steps you recommend I take? 

dunstonh

I have received no justification for why this is happening

They don't have to.  Employer schemes has the employer as the scheme owner.

and it will cost me more in management charges for probably a much lower return (SL pensions don't seem to have performed very well in recent years). 

Cost is defined but your comment on SL pension performance is completely wrong.   Especially as current Standard Life is not the same as Standard Life from two years ago.     Two years ago, SL was owned by SLA. Today, it is owned by Phoenix.    Some Standard life plans are whole of market.  Some plans are limited to a couple of dozen funds.  Nearly all SL plans have access to some trackers.

 Is this all quite normal with company pension funds? 

Is it a company pension or a group scheme?
There are a lot of companies moving away from company pensions to workplace master trust schemes or modern group schemes with better integration into payroll systems than legacy schemes.  There is also a trend away from older group schemes to modern ones as insurers set up dedicated sub companies to handle workplace pensions rather than the old group schemes which were handled by the main company.

There is also the issue that company pensions see the employer pay the administrator.  But many workplace pensions have very little cost to the company.

Marcon

Roborovski said:

I have £230k in my previous employer's pension plan. It is managed by WTW and has been performing well since I left 5 years ago. I have just received a letter from my ex-employer stating that from 2nd April my pot will be moved to a new scheme managed by Standard Life, unless I take steps at my own expense to move it elsewhere before that date. I have received no justification for why this is happening, and it will cost me more in management charges for probably a much lower return (SL pensions don't seem to have performed very well in recent years). There has been no correspondence from the Trustees, which seems strange, and the timescales seem unreasonably tight. Is this all quite normal with company pension funds? Are there steps you recommend I take? 

The fact it is managed by a third party administrator (WTW) strongly suggests it is a trust-based company scheme -  confirmed by your observation that you have had 'no correspondence from the trustees'.

You say 'take steps at your own expense...', but unless the scheme has any sort of 'safeguarded benefits' (broadly speaking, promises such as a guaranteed annuity rate), you can normally transfer as you see fit, with no expense to you.

Albermarle

Roborovski said:

I have £230k in my previous employer's pension plan. It is managed by WTW and has been performing well since I left 5 years ago. I have just received a letter from my ex-employer stating that from 2nd April my pot will be moved to a new scheme managed by Standard Life, unless I take steps at my own expense to move it elsewhere before that date. I have received no justification for why this is happening, and it will cost me more in management charges for probably a much lower return (SL pensions don't seem to have performed very well in recent years). There has been no correspondence from the Trustees, which seems strange, and the timescales seem unreasonably tight. Is this all quite normal with company pension funds? Are there steps you recommend I take? 

Pensions do not perform, the investments inside them do. So you can not compare performance of WTW vs SL, without detailing exactly how each one is invested.
The same investment fund held in WTW or SL , will perform exactly the same.
So there is no reason at all that you will suffer from low growth, specifically due to moving to SL, although you could be wise to research the investment choices rather than just going with the default option. 
It is possible the charges will be different. SL typically have a charge, and then discounts negotiated with the employer.
Normally there would be no charges involved in transferring out to another pension provider. It is all rather easy online nowadays, and some even offer cashback incentives.

It could work out OK, as WTW have a poor reputation for customer service in some areas and SL are OK in my experience.

artyboy

Albermarle said:

Roborovski said:

I have £230k in my previous employer's pension plan. It is managed by WTW and has been performing well since I left 5 years ago. I have just received a letter from my ex-employer stating that from 2nd April my pot will be moved to a new scheme managed by Standard Life, unless I take steps at my own expense to move it elsewhere before that date. I have received no justification for why this is happening, and it will cost me more in management charges for probably a much lower return (SL pensions don't seem to have performed very well in recent years). There has been no correspondence from the Trustees, which seems strange, and the timescales seem unreasonably tight. Is this all quite normal with company pension funds? Are there steps you recommend I take? 

Pensions do not perform, the investments inside them do. So you can not compare performance of WTW vs SL, without detailing exactly how each one is invested.
The same investment fund held in WTW or SL , will perform exactly the same.
So there is no reason at all that you will suffer from low growth, specifically due to moving to SL, although you could be wise to research the investment choices rather than just going with the default option. 
It is possible the charges will be different. SL typically have a charge, and then discounts negotiated with the employer.
Normally there would be no charges involved in transferring out to another pension provider. It is all rather easy online nowadays, and some even offer cashback incentives.

It could work out OK, as WTW have a poor reputation for customer service in some areas and SL are OK in my experience.

And the award for understatement of the day goes to...

But yes, that was my first thought, as someone that has suffered WTW with 2 former occupational pensions, and now finally shot of them (after an excruciating transfer out process).

Leaving performance to one side, the OP is at least going to benefit from a better service level. 

Roborovski

Thanks to all for your helpful and informative responses. I certainly feel reassurance that the move is not necessarily the backward step that I had thought.