The Pensions and Lifetime Savings Association (PLSA) is inviting applications for its Pension Quality Mark (PQM), after making changes to the minimum requirements.
The association revised and updated the standards for its PQM in January to reflect changes in regulation and practice since it launched in 2009 for single-employer defined contribution (DC) trusts. The accreditation – which was developed to help employers develop the quality of their pension funds – has around 180 schemes covering over 650,000 active savers, the PLSA said.
The applicants will need combined employer and employee contribution rates of 12% or more in total to meet the standards, up two percentage points from its previous minimum requirements. The change reflects research from its Hitting the Target report last year, which found 12% contributions are necessary for members to have an adequate retirement.
Meanwhile, as before, PQM applicants will have the option to apply for the PQM Plus standard which requires a minimum of 15% contributions.
At the same time, the PQM standards committee – which was set up to drive forward its work – has announced its members which include: chairwoman Lesley Williams (pictured), who was formerly chairwoman of the PLSA; Lloyds Banking Group Pension Schemes chief investment officer Ian McKinlay; Smart Pension head of sustainable investment Rachel Neill; Leonardo head of pensions Mike Nixon; NEST members’ panel chairman Nigel Stanley; and Reed Smith partner Will Sutton.
Williams said: “We are bringing these new standards to the industry to highlight those schemes that are really pushing to help savers achieve a good level of income in their retirements and to encourage others to join them.”
She added: “We’re also delighted to welcome the new members of the PQM standards committee. Each has a firm interest in encouraging high standards in pension provision and together will bring diverse expertise to ensure the continued success of PQM.”
The revised standards currently apply only for those schemes that have previously not been awarded the PQM. Renewing applicants will be able to transition, over time, to the updated standards, the trade body said.
Speaking at Pensions and Benefits UK on 25 June, the PLSA’s director of policy Nigel Peaple said AE minimum contribution rates could rise to 12% by 2030, with a 50/50 split between employer and employee.