Consultants are creaming off up to half of workers' annual pension savings in set-up costs, an investigation has warned.

Consumer watchdog Which? found that companies are willing to accept consultancy fees that would see employees' savings reduced by up to 50pc in their first year. Staff in these pension schemes can do nothing about the charge, and the pension scheme consultants don't have to be regulated or have any qualifications. Which? investigators posted as pension scheme consultants, and asked five insurance companies for a list of fees to set up a pensuion for an employer.

In some cases two insurers did not object to charges that could reduce the first year's savings by almost 50pc. One did not object to fees of £400 per scheme member for the first eyar and ongoing annual charges of £5. With fees at that level, someone contributing £100 a month would see their first year's saving reduced to just £795.....Read more here

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