A CRACKDOWN on the pensions market has been ordered by the trading watchdog as it said billions of pounds of savers' cash is already at risk of delivering poor value for money.
The Office of Fair Trading (OFT) made a raft of recommendations to make sure up to nine million people who will be saving into defined contribution workplace pensions in coming years do not see their money gobbled up by rip-off charges.
But consumer campaigners said further action is needed to "prevent billions of pounds of consumers' money from languishing in poor-value schemes".
Up to £40 billion-worth of pension savings may already be in schemes delivering poor value or are at risk of doing so, the OFT said.
Confidence in pension saving is seen as vital to the Government's automatic enrolment scheme being a success - but a report produced by the OFT found that "most employees do not engage with, or understand, their pensions".
The OFT, which looked at how well competition works, said the buyer side of this market is "one of the weakest" in recent years.
It advised the Government to look at improving the transparency and comparability of different schemes.
Margaret Lynch, chief executive of Citizens Advice Scotland, said: "The government should consider all options to make sure that we have a water-tight pension system that works for consumers."
Minister for Pensions Steve Webb said: "This report outlines further important ways to help consumers, and we will act on its recommendations."
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