Part 5: Further provision relating to pension schemes Administration charges Section 127: Administration charges
Schedule 18 to the Pensions Act 2014 allows the Secretary of State to make regulations which limit or prohibit particular types of administration charges in relation to pension schemes specified in the regulations. Section 1 of the Welfare Reform and Pensions Act 1999 ("the 1999 Act") sets out the conditions that must be met by a stakeholder pension scheme. These include that the scheme complies with such requirements as are set out in regulations concerning deductions from members’ pension funds in respect of charges and expenses.
	"Administration charge" is defined in Schedule 18 to the Pension Act 2014. Subsection (2) of this section amends the definition to make it clearer which charges are in scope of the definition. The effect of the amendments is that an "administration charge", in relation to a member of a pension scheme, means any use of the scheme’s assets to meet the administrative expenses of the scheme, to pay commission or in any other way, that does not constitute the member drawing their pension benefits, or moving their savings to acquire pension rights in in a different scheme. Subsection (1) makes similar amendments in relation to the description of administration charges in subsection (5) of section 1 of the 1999 Act (meaning of "stakeholder pension scheme").
	Subsection (3) amends subsections (6)(b) and (7) of Section 113 of the Pension Schemes Act 1993 (disclosure of information about schemes to members) and subsection (4) amends subsections (3)(b), (4) and (7) of Section 137FA of the Financial Services and Markets Act 2000 (FCA general rules: disclosure of information about pension scheme transaction costs etc) to make clear that transaction costs are a type of administration charge.