UK - The Personal Accounts Delivery Authority has launched a discussion paper on the investment approach for the new national pension scheme.
It said it anticipated the majority of members - largely low to moderate earners - would be invested in the default fund and said it would put particular focus on this fund.
PADA chief executive Tim Jones said: "This discussion paper seeks to draw on the experience and expertise of the investment industry, pension scheme providers, consumer groups, employers, and existing trustees to help PADA design a pension scheme that will provide the best outcomes for future members as well as access to low-cost pension savings."
The discussion paper also asks for views on:
- The investment objective and design of the default fund
- The investment approach as members near retirement
- Achievement of high quality corporate governance
- Responsible investment and its role within the scheme
- The number and types of further fund choice that should be made available
PADA investment director Mark Fawcett said: "We are looking to hear both innovative and proven solutions and crucially how these can be delivered at a low charge."
Aegon head of pensions development Rachel Vahey commented: "Several million people could be auto enrolled into personal accounts, many of whom have little or no investment experience or knowledge. Selecting a suitable range of funds and designing the default fund, where typically 90% or more will end up, will be crucial."
She added: "PADA and the Government have a responsibility to improve savers' investment knowledge as part of the personal accounts journey. Simply getting people into a fund and leaving them there for 20 or 30 years is unlikely to be in their best interests."
The PADA consultation process will close on August 7.
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