Workers who enrol in the proposed new national savings system may not be able to easily take existing pension pots with them if they change jobs.

In the biggest pension shake-up in 60 years, the government has endorsed plans to automatically put workers into a National Pension Savings Scheme (NPSS) to help close an estimated 57 billion pound savings gap.

But if a worker in an NPSS plan quits a job to work for a business that provides a different, perhaps more generously funded scheme, it may be difficult for that person to transfer any accumulated NPSS savings into it.

I don't think the issue of portability has been really thought through, said Damian Morrish, principal, employee benefits, at actuaries and consultants Punter Southall.

My fear is that if you don't get full portability with the NPSS, you end up with lots of little pockets of money, he told Reuters.

It may be uneconomic for the NPSS to handle transfers to and from other pension plans, because legislators plan to run the NPSS for an annual management charge as low as 0.3 percent much less than current industry levels, Morrish said.

While policymakers have sometimes called for portable pensions to encourage worker mobility, issues such as taxes, benefits and regulations have hampered the idea from becoming reality.

It is unclear how easy it will be for an employee to retain an investment pot after a job change. The portability of any funds run through the NPSS is uncertain, Paul McGlone, a principal at consultants Aon, told Reuters.

Workers who enrol in the proposed new national savings system may not be able to easily take existing pension pots with them if they change jobs.

In the biggest pension shake up in 60 years, the government has endorsed plans to automatically put workers into a National Pension Savings Scheme (NPSS) to help close an estimated 57 billion pound savings gap.

But if a worker in an NPSS plan quits a job to work for a business that provides a different, perhaps more generously funded scheme, it may be difficult for that person to transfer any accumulated NPSS savings into it.

I don't think the issue of portability has been really thought through, said Damian Morrish, principal, employee benefits, at actuaries and consultants Punter Southall.

My fear is that if you don't get full portability with the NPSS, you end up with lots of little pockets of money, he told Reuters.

It may be uneconomic for the NPSS to handle transfers to and from other pension plans, because legislators plan to run the NPSS for an annual management charge as low as 0.3 percent much less than current industry levels, Morrish said.

While policymakers have sometimes called for portable pensions to encourage worker mobility, issues such as taxes, benefits and regulations have hampered the idea from becoming reality.

It is unclear how easy it will be for an employee to retain an investment pot after a job change. The portability of any funds run through the NPSS is uncertain, Paul McGlone, a principal at consultants Aon, told Reuters.

Workers who enrol in the proposed new national savings system may not be able to easily take existing pension pots with them if they change jobs.

Investment Social Security