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17th August 2016

consultation Finds widespread support for development of retirement quality mark

The Pension Quality Mark (PQM) Board has published an overview of responses to its consultation on developing a Retirement Quality Mark (RQM). The responses show widespread support for the role a RQM could play in helping savers secure a good retirement income and trustees to support pension scheme members.

For savers, there was agreement that a quality mark would:

• Build on current guidance and act as an enabling tool to help consumers make informed decisions.

• Signal products that had met an independent quality standard in relation to governance and communications. 85% of consumers thought it was important for a good retirement product to be independently accredited by a third party.

• Help build confidence in pensions and retirement saving.

Similarly, respondents felt that for trustees a quality mark would assist them in signposting scheme members to products that have been assessed as being good, based on the quality of their governance and communications.

A RQM could help support the development of a robust in-retirement market that operates in the interests of savers by setting out the standards of what good looks like in relation to the governance, default investments, member alerts and the communication of charges and risk.

The original consultation document, published November 2015, sought views on the role of a Retirement Quality Mark and the standards it might use. The consultation summarises responses to these governance and communication standards.

Adrian Boulding, Chair of the Pension Quality Mark Board, commented:

"The Board has been greatly encouraged by the strong support from across the industry for a Retirement Quality Mark and the useful role it could play in steering savers towards a good quality product at retirement, while also helping pension scheme trustees and employers in their roles. On behalf of the Board I would like to thank those who responded to the consultation so fully.

"We will continue to refine the standards and develop the infrastructure to support the RQM, and expect to launch the new mark later this year. In the interim, we will carry out further discussions with pension schemes and providers interested in becoming RQM award holders, as well as the wider stakeholder community."

Joanne Segars, PQM Executive Director and Chief Executive of the Pensions and Lifetime Savings Association, commented:

"Our Understanding Retirement research found that whilst there hasn't been a 'dash for cash' amongst the first wave of savers to use the new flexibilities, there's a significant amount of uncertainty and worry about the new retirement income decisions they are now having to make.

"Savers and those guiding them need help to understand what good looks like in this new breed of retirement income products. They need reassurance that high quality governance will focus on value-for-money, there is an appropriate default investment strategy in place, and that savers will receive high quality communications throughout their retirement.

"We believe that developing a set of clear and recognisable quality standards for retirement income solutions that people can trust will help product providers to develop the type of products savers need and help savers to make sense of the new choices they face."

Read the PQM Board's response to the consultation paper .


Pension Quality Mark (PQM)

PQM was launched in 2009 and is wholly owned by the Pensions and Lifetime Savings Association. PQM is a standard that recognises high quality DC pension schemes. It is designed to raise confidence in workplace pensions, helping employers demonstrate that their scheme is good quality. There are currently 213 pension schemes with a PQM, covering 673,322 active scheme members.

There are two standards, PQM and PQM PLUS. Under PQM, the scheme's total contributions must equal at least 10% of an employee's pensionable salary, with a minimum employer contribution of 6%. Under PQM PLUS, the scheme's total contributions must equal at least 15%, with a minimum employer contribution of 10%. PQM READY was launched in February 2013 and aims to help employers spot a good multi-employer pension scheme or mastertrust.

Further information about the Pension Quality Mark can be found at

Research by PQM's parent company, the Pensions and Lifetime Savings Association, found that whilst the majority of savers welcomed the new pension freedoms introduced in April 2015, many worried about the risks. The PQM board felt there was potential for a parallel Mark for in-retirement products to help savers and trustees by:

• providing strong governance to in-retirement products so they operate in the customers' best interests not just at the point of sale, but on an on-going basis;

• ensuring there are high quality, clear and actionable member alerts;

• ensuring that default investment options are well governed and appropriately designed; and

• providing value for money to savers.

Source: Understanding Retirement research series: Pension Freedoms: Breaking the deadlock, published by the Pensions and Lifetime Savings Association in April 2015.


Lucy Grubb, Head of Media and PR, Pensions and Lifetime Savings Association

T: 020 7601 1726, M: 07713 073023, E:

Bobby Mayamey, PR Manager, Pensions and Lifetime Savings Association

T: 020 7601 1718, M: 07825 171 446, E:

Kathryn Mortimer, Press Officer, Pensions and Lifetime Savings Association

T: 0207 601 1748, M:07901 007713, E:

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