Wide range of bodies join forces to attack 'pot follows member'

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Organisations representing employers, consumers, workers and the elderly have joined the National Association of Pension Funds (NAPF) in urging the government to rethink its commitment to pot follows member.

In a letter in today's Financial Times, the unlikely coalition said the government's preferred option for consolidating small pots had a " a number of inherent risks and weaknesses". The signatories said pot follows member could expose people to repeated transaction costs as assets had to be divested and reinvested with every transfer. They added members risked being transferred from well-run arrangements to poor quality schemes and said the system could push savers into investments that had high liquidity but limited growth. They said: "The regular movement of billions of pounds o...

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