Defined contribution (DC) savers face lower costs and charges after providers made a concerted effort to reduce these to less than 1% over the past two years.
Around £24.9bn of assets under management (AuM) across 23 providers have seen cost cut to below 1% since 2015, with £4.9bn of this figure having reduced fees since last year.
The reduced fees come after a multi-agency effort discovered between £5.6bn and £8bn of DC savings were potentially subject to charges over 2%, while £1bn - primarily relating to pots worth less than £10,000 - was potentially exposed to charges over 3%.
This led to the Financial Conduct Authority (FCA), the Department for Work and Pensions (DWP), independent governance committees (IGCs) and trustees uniting to drive down the potentially unnecessary costs.
In particular, the FCA launched a programme of action targeted at schemes with charges over 1%, with the regulator requiring remedial action or an explanation of the high costs and charges.
After further independent pressure from IGCs and trustees, providers then set out their progress and any remaining actions they needed to take, which was reviewed by the FCA.
Commenting on today's figures, pensions and financial inclusion minister Guy Opperman said the government was committed to reducing unnecessarily high charges.
"No-one that saves into a pension scheme should have concerns that their savings are at risk of being eroded by excessive charges," he said. "That's why we are tipping the balance back in favour of consumers, who will now see their schemes delivering better value and increasing their income in retirement.
"By working closely with regulators and providers, we are committed to getting consumers the best possible deal."
An estimated £0.9bn of AuM in DC schemes within the review continue to face charges of over 1%, with some of these setting out why they believe the charge is justified, and the remainder taking further action next year.
In a statement, the FCA also welcomed the industry's efforts.
"This is a good outcome for current and prospective members of workplace pension schemes, who can have confidence that potential investment returns on their retirement savings are not being eroded by excessive charges, increasing the prospect of a higher income in retirement."
The action was launched after the Association of British Insurers (ABI) launched an independent project board to audit both contract- and trust-based schemes with charges believed to be unnecessarily above 1% and therefore at risk of delivering poor value for money.
The board recommended such schemes reviewed the output of the audit and identify potential actions to reduce the costs and charges and deliver better value for money, and then agree an implementation plan by December 2015.
The figures come ahead of mandatory investment costs and charges disclosure next year. From 3 January, the FCA will mandate its regulated firms looking after DC assets to provide a breakdown of costs and charges to trustees on demand, while trust-based DC schemes will need to publish costs and charges information to members from April 2018 or face a fine up to £50,000.
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