Nearly three-quarters of pension schemes have not carried out a value-for-money assessment, as required by the new standards set by the Pension Regulators defined contribution code of practice, lawyers have warned.
This code of practice sets out the legal requirements and standards of governance and administration that trustees of work-based DC trust-based schemes need to attain. But law firm Sackers' poll of around 80 trustees and pension delegates found that only three in ten schemes had carried out a value-for-money assessment.
Helen Ball, head of DC at Sackers, said: 'Many pension schemes are preoccupied with adopting the changes announced in this year’s Budget, but forget that those are largely optional.
'Our findings highlight the difficulty schemes face in assessing value for money for scheme members, and emphasise the confusion that persists regarding the exact requirements of governance assessments.'
The poll also found that just two fifths (41%) of schemes had completed their governance assessment against the TPR's DC code of practice.
Schemes that have not completed or begun their review of DC governance for the purpose of the TPR code of practice would need to complete this by the end of their 2014/15 year, the lawyers said.
Meanwhile, the poll found that a third of schemes (33%) had not yet reviewed their default fund to assess whether it would comply with the incoming charge cap.
The Department for Work and Pensions confirmed last month that charges to invest and manage the default funds of all qualifying schemes would be capped at 0.75% yearly from next April.
Schemes that have not reviewed their default fund will be left with little time to make any changes before next April, warned the lawyers.