NOW – for something completely different.

Amid all the noise of auto-enrolment , one master trusts has put its head down and got on with mending a damaged reputation by hard work and through decent behaviour. I’m talking about NOW pensions.

NOW was set up by ATP, the Danish State owned pension provider, keen to launch its unique style of asset management into the UK. We have yet to see the outcome of it’s investment strategy because its UK fund is barely five years old, but I am confident that it is managed with the member in mind. I also know the governance on the fund is strict, the investments direct (with minimal intermediation) and the philosophy behind the fund simple and effective.

Were it possible for me to have access to the NOW fund, purely to spend my accumulated pension pot, I would consider it, primarily because of what lies behind this email sent from NOW’s Amy Mankelow to my friend Kate Upcraft, from a mail to Cintra’s Ian Holloway.

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It’s down to two payroll experts to bring this to my attention (thanks Ian and Kate). The sadness is that for most pension experts, what Amy is saying will be of little interest.

This is shameful. We do not know how many people are contributing to  ‘net pay’ pensions who get neither tax-relief or the equivalent Government Incentive, because they pay no tax. I am requesting this information from the DWP as the Government’s own Real Time Information service can gather it for them,

We do know that 100% of these people would get the Government Incentive if they were in a master trust that operated under the alternative tax system and we know that master trusts are able to choose to operate under net pay, relief at source or to “swing both ways”.

The only master trust that operates purely on a relief at source basis (RAS)is NEST, Peoples and Supertrust default to relief at source (but swing both ways) and the rest of the mastertrusts operate a net pay system (please write to me if your master trust offers  RAS and I don’t know it).

NOW is tied to net pay because of a decision to have its pension scheme administered by JLT, a third party administrator who’s systems cannot be altered to administer contributions on a relief at source basis.

However, it has taken a unilateral decision to compensate members who do not receive the Government incentive (because their total annual earnings are below £11,000) out of their own pockets.

No doubt NOW thought that this would be a short-term fix. I spoke with their executive and they could not comprehend how the occupational pension industry (which operates almost entirely on a net pay basis), could allow this anomaly to continue – BUT IT HAS.

Meanwhile low earners are being denied up to £150 a year in extra pension contribution from the Government, because the rest of the occupational pension industry cannot be bothered to do anything about this.

A duty of care

In my opinion, the trustee’s duty of care extends beyond those people the employer considers most important (those it pays the most) – to those who are least regarded (those it pays least). These disregarded people are most vulnerable as they have less access to financial advice and are often socially and educationally disadvantaged (so they find it harder to pick up complicated stuff about pensions and tax).

These are the people that occupational pension scheme trustees should care most about , but appear to care least about. These are the people who Theresa May refers to as “just getting by” and they are being completely ignored by all occupational pension schemes other than NEST, Peoples , Supertrust and NOW.

There are many other occupational pension schemes being administered by JLT and third party administrators like JLT who cannot alter their systems to cope with RAS. Indeed NOW’s largest employer has recently moved from NOW to direct trusteeship while retaining JLT as its trustees. In doing so it has inadvertently deprived its low paid employees (of which it has many) of the NOW compensation scheme mentioned in the email above.

A shameful lack of care

The plight of the poorest in pensions is extreme and is being systematically ignored. The Pension and Lifetime Savings Association (NAPF that was) seem totally disinterested in this matter. It does not get discussed at their meetings and conferences, it is not on their “policy matters” agenda.

It should be.

The DWP continue to poo-poo the issue as a distraction. Their recently (ex) Pension Minister has gone on record venting her frustration that she could not get this issue onto the Government’s public policy agenda.

It should be.

The Pensions Regulator recently published its DC code with no mention of this issue whatsoever. You can see my thoughts about this here. Thanks to Ian Neale for his excellent comment on this blog. TPR seem to think this is none of the trustees’ business.

It should be.

Even the opposition, what’s left of it (as we haven’t even got a shadow pension minister at the moment) have been ignoring this issue. Unite , Unison and the other major unions remain silent.

They should be shouting “foul”.

Of course the trustees and sponsors of occupational pension schemes will point out that the real villain is the Treasury, for promising a radical reform of tax relief and not delivering. For the best part of two years we have been waiting to hear if the net pay anomaly is going to go away.

The Treasury need to be definitive about taxation, but in the meantime, there is no reason for occupational schemes to sit on their hands.

Only NOW!

Only Now, of all the occupational pension schemes operating under net pay, has done something for its affected members. And what are they getting in return? The brick-bats from the pensions industry for sins and omissions that they have or are rectifying.

My friend Adrian Boulding, who is negotiating  for NOW with Government , must feel in a lonely place. Courage Adrian – and thanks to you for persevering .


It’s time that somebody stood up and gave now a bow!

Because a pension scheme that looks after the weak and the vulnerable -as well as those from whom it makes its money, is a pension scheme that I can trust.

The proof of a pension scheme is in its behaviour, not what it says- but what it does. Go back and read the very small print of what Amy Mankelow is saying on behalf of NOW Pensions.

Isn’t that something that restores your confidence?


About henry tapper

Founder of the Pension PlayPen,, partner of Stella, father of Olly . I am the Pension Plowman
This entry was posted in napf, NEST, now, pensions and tagged , , , , , , , , , , , , . Bookmark the permalink.

8 Responses to NOW – for something completely different.

  1. Ian Neale says:


    In our article last week on the new DC Code and accompanying guidance (, I included this comment:

    Good value for members should be the over-arching objective. The ongoing focus on charges and transaction costs, here in the Code and elsewhere, indicates the importance TPR and the government apparently attach to this. And yet some trustees are handicapped in delivering good value for low-paid members. If to fulfil their auto-enrolment duties the employer has selected an occupational pension scheme operating net pay arrangements, rather than the alternative system of ‘relief at source’, members earning less than £11,000 pa will receive no tax relief. Nothing in the Code draws trustees’ attention to this . . .

    The Regulator apparently thinks it is none of the trustees’ business!

  2. henry tapper says:

    A very good point Ian; I too wrote about this and will include the link in future versions of the blog.

  3. Mike Lacey says:

    I’ve raised this issue previously ( hurrah for me) as I really don’t feel able to recommend a provider that doesn’t automatically add tax relief for non taxpayers. I recently had an email from somebody claiming to be from “the Automatic Enrolment provider of choice in the UK” ( a Master Trust around a year old) who don’t do this.

    Given most non taxpayers will be female, this could lead to action for indirect sex discrimination – Barber vs. GRE refers.

    I know some think the amounts are small so it doesn’t matter, but what about the situation whereby a couple with one very highly paid, one doing part time work and not paying tax. That couple could well afford to pay £2880 to an AE plan each year, and they’d lose £720 pa. I remember some contributors trying to rubbish that suggestion…

    Very much welcome the approach taken by NOW, regardless.

  4. Mike Lacey says:

    *Coloroll, not Barber…

  5. A really important post Henry, I’d be happy teeo lend support, dm or email me with what you think would be optimal. D

  6. I would add that its only rich people who think small amounts don’t matter.

  7. henry tapper says:

    I think you’ve just come up with the campaign’s strap line Debora. “Only rich people think small amounts don’t matter”.

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