Bad news for active managers as government targets pension charges

War on 'rip-off' fees

The government's war on fund charges could price out active managers from large chunks of the pension market, writes Natalie Kenway.

Last year the UK government introduced a 0.75% cap on investment charges paid within auto-enrolment pension schemes, in a bid to divert up to £200m from the profits of pension providers into savers' pension pots. The cap was introduced in April, when former Pensions Minister Steve Webb declared a war on "rip-off" fees. "We are going to put charges in a vice; and we will tighten the pressure, year-after-year," he said at the time, signalling the government could introduce more caps in the future. This could be bad news for active managers, which often charge more than 75bps for acce...