Personal Pension  

Nest fees will not need to rise, says John Taylor

Speaking at a Nest conference in Leeds, the managing director of customer and proposition at the organisation reassured advisers the scheme was “solid and built to last for the future”.

When asked by a financial adviser if Nest could be forced to increase management fees should membership and contributions not be sufficient, he responded that numbers were higher than initially anticipated and plans had been carefully made to ensure high volumes were effectively dealt with.

He said: “Nest is not something planned on a year–by-year basis and is something that will run for decades. We are confident with the long-term financing plans between us and the government.

Article continues after advert

“The one potential risk is that we don’t get sufficient scale. However, scenario planning has gone well above the 2m members predicted, so I think this issue is unlikely to come up.”

Mr Taylor also assured attendees that Nest would not suffer the same capacity crunch as some big name providers have allegedly been hit by.

According to Mr Taylor, Nest has been prepared since day one for potential mass influxes and has done plenty of scenario planning to be able to deal with rapid changes in numbers.

He said: “The easy bit is making sure we have the IT capabilities in place. The more challenging bit is getting the call centres staffed to sufficient levels, which is why we outsourced this to TCS.”

Adviser view:

Attendee Roy McLoughlin, partner at London-based Master Adviser, said: “The problem you’ve got is that the big boys are saying ‘this will take a lot of time’, but one gets the impression that you will wait and then get turned down.

“I anticipate that many people will not get offered terms. A lot of people assume they will get a mainstream insurer and will be left disappointed. This means that Nest will end up with more schemes than any other and the issue there, of course.”