Pensions Bulletin 2024/33

TPR encourages DC trustees to engage with FCA’s VFM consultation

The Pensions Regulator (TPR) has published a blog explaining why it believes that trust-based schemes must “seize this opportunity to shape one of the biggest revolutions in pensions policy since auto enrolment” by engaging with the Financial Conduct Authority’s consultation on its Value for Money (VFM) framework (which closes on 17 October - see Pensions Bulletin 2024/31)

TPR says that it can’t deliver a change from focussing on cost towards improving value for savers alone and that it doesn’t want to. Instead TPR wants to work with industry to ensure the VFM framework will:

• enable effective competition between schemes and facilitate employer choice;
• reduce the number of savers with workplace pensions that deliver poor value; and
• drive better value across the whole workplace DC market.

Therefore, TPR is encouraging master trusts – which account for 95% of active memberships in DC trust-based pensions – and large single-employer trusts to adopt the framework early in order to inform the legislative regime that will follow in the Pension Schemes Bill.

TPR goes on to highlight several areas where it particularly wants to hear from respondents. These include how best to measure quality of service and issues surrounding the use of forward-looking metrics.