Changes to NEST
NEST is the National Employment Savings Trust. It’s a pension scheme set up by the Government, but run independently from it. Unlike some schemes, NEST has some restrictions imposed upon it.
The National Employment Savings Trust (NEST) was set up by Government as one option for employers to use, in order to comply with automatic enrolment. Although it was set up by the Government, NEST is run completely independently from it. Unlike some pension schemes, NEST had some restrictions place upon it, they are currently:
- not able to accept transfers in from other pension schemes;
- not able to pay transfers out to other pension scheme; and
- not able to accept contributions of more than £4,600 a year (2014/15). This includes both employer and the member contributions.
These restrictions can be limiting and could sometimes deter employers from using NEST for automatically enrolling their eligible workers. However, in November 2012, the Government launched a consultation into whether the restrictions should be removed. In February 2013, the Work and Pensions Select Committee (a committee of Parliament) published its report into removing these restrictions. The report said that the restrictions should be removed immediately if automatic enrolment is to work successfully.
Following the consultation outcome the Government stated that the original restrictions imposed on NEST will be lifted in 2017, and that until then the restrictions will be temporary. This will enable NEST to focus on supporting the successful implementation of automatic enrolment.
To read more about the removal of the restrictions and what this might mean for you, please click here.
Where can I find out more?
If you need more information, please contact us. A pension specialist from our team will be happy to help with whatever pensions-related question you have. Our help is always free.