The Pensions Quality Mark

The Pensions Quality Mark (PQM) is a voluntary yardstick for employers providing DC pensions and sets standards for use by employers, for multi-employer and master trust schemes (see page 81). To meet the contribution standards for PQM, a scheme must offer a total contribution of 10% of pay with at least 6% from the employer; and for PQM Plus, 15% with a contribution of at least 10% from the employer. It must also satisfy a definition of pensionable earnings and comply with rules for the “configuration” of contributions (see page 52). It must also meet PQM rules on how long it is before someone can join a scheme (the waiting period) and on “nursery arrangements” (a scheme you can join while waiting to join a better scheme).

PQM is backed by the National Association of Pension Funds (NAPF). Chief Executive Joanne Segars has warned employers to “brave up” to the issue of higher contributions, as 12% or 15% are more commonly seen as being “the right kinds of benchmarks”. Companies achieving PQM in 2014 included furniture retailer IKEA and the Lufthansa airline.