Pension Quality Mark (September 2009)
print
print   

  Employee Benefits -> EB Article Library

The National Association of Pension Funds (NAPF) has announced that employers can apply for a Pension Quality Mark (PQM), which has been set up to promote good quality defined contribution workplace pension schemes.

Benefits of applying

Successful applicants can show that their pension scheme has been externally recognised for its quality. Employers will be able to use the PQM logo on their pension scheme documentation, job advertisements and web site.  They will also receive a certificate and be able to purchase PQM plaques to display in the workplace.

This should encourage employee confidence in a pension scheme and demonstrate its value to current and prospective employees.

Who can apply?

Any type of workplace defined contribution pension scheme can apply for the PQM.  This includes occupational (trust based) schemes, group personal pension and group stakeholder pension schemes.  It is not necessary to be a member of the NAPF to apply.

How to qualify for a PQM?

There are 3 core aspects of good pension provision: contributions, governance and communication.

  • Contributions

    To meet the PQM standard, contributions must total at least 10% of earnings, with a minimum of 6% from employers.  This allows flexibility so that many types of pension schemes can meet the standard.  There is also a higher standard, PQM Plus, for schemes with contributions of at least 15% with a minimum of 10% coming from the employer.

  • Governance

    Governance arrangements must be in place to ensure that the scheme is operating in the best interests of members. This could take a variety of forms including trust boards, management committees or an annual scheme review. Charges for administration are limited to 1% of the main funds.

  • Communication

    All types of communications may be included in meeting the standard e.g. face to face, over the phone and paper communications. However employees must be provided with clear and engaging communications when they join, throughout their scheme membership and when approaching retirement.

Contact us to find out more about the Pension Quality Mark and how you can apply for one.

Cartlidge Morland is an independent employee benefits consultancy. We provide benefit services to a wide range of partnerships, family companies, PLCs, charities and governmental organisations. We also provide financial advice to private clients, investment management and mortgage broking services.

Phone us on 020 7709 5560 or complete the online contact form