U.K. keeps pressure steady on poorly governed plans
Defined contribution master trusts in the U.K. could see an additional boost in assets as the U.K. Pensions Regulator pressures single-employer plans to step up their governance and investment oversight.
The Pensions Regulator has been on a mission to weed out poorly governed defined contribution plans in the U.K. for quite some time. After asking master trusts, also called multiemployer DC plans, to obtain new operating permissions to stay in the market, the number of DC master trusts was cut by more than half.
Most recent data from the regulator showed 38 master trusts operating the U.K. in May, down from 91 a year ago. Of those 38, about two-thirds are still in the midst of an approval process that requires payment of a £ 41,000 ($ 53,000) licensing fee and proof that they have the financial resources to pay up to £ 150,000 for the cost of complying with fiduciary duty regulations, according to the regulator’s data.
In June, the regulator issued another order, directing single-employer DC plans with two to 999 members – an estimated 500 plans in the U.K. – to review their default options to ensure they deliver investment value to plan participants, which could further decrease the number of DC plans, according to sources.
Read more @Pio Online
