The pensions sector in the UK is facing a "capacity crunch" due to the pace and volume of regulatory change, the National Association of Pension Funds (NAPF) has found.

According to a survey by the NAPF, 81% of respondents across business and pension scheme members said that the volume of change by the sector in the next 12 months will adversely affect the level of service they are able to provide.

The greatest concern for both pension scheme and business members was the abolition of defined benefit (DB) 'contracting out' at 78%.

Business members were then most worried about the implementation of auto-enrolment, while pension schemes said they were concerned with the problems posed by the administration of pensions tax relief and with pension liberation requests.

Joanne Segars, NAPF chief executive, said: "The pensions sector is facing a 'capacity crunch'. The NAPF and its members have worked hard to shape and deliver effective reforms that bring positive results for pension savers, but this stack of change threatens our members' ability to continue to deliver business as usual."

She said that she welcomed the ambition behind all of the various regulatory changes; however there is a risk of not delivering the best outcomes for workers and savers, if so much was done in such a short space of time.

Segars added: "This is too important to rush. We need to press pause, prioritise what really matters and deliver automatic enrolment effectively – making sure we build the very strongest foundation on which to build sustainable and positive change for the future."

First published 05.02.2014

monique_simpson@wilmington.co.uk