03 January 2024

The Pensions and Lifetime Savings Association (PLSA) has set establishing what role pension funds can play in supporting growth in the UK economy as its top strategic policy priority for 2024.

In 2023, after consulting with a wide range of pension providers, policymakers, think tanks and stakeholders, the PLSA made specific recommendations aimed at promoting further investment by suitable pension scheme in assets which can help drive domestic growth.

This year, with an upcoming general election and a challenging economic outlook, the PLSA will further develop these recommendations to ensure this Government, and whichever party wins the election, are equipped to make informed policy proposals for the £2.5tn pension sector, without compromising the interests of the millions of UK workers saving into an occupational pension fund.

The PLSA’s work programme is reviewed annually by its Policy Board, a body comprising experts from a broad cross-section of the PLSA’s membership, with responsibility for setting the policy agenda and ensuring the issues that matter most to the industry body’s members are being tackled.

Beyond pension funds’ role in UK growth, the PLSA Policy Board has identified additional regulatory projects it will prioritise in 2024, categorised under six broad themes.

Better DC: The PLSA will advocate for an efficient and effective DC pensions landscape that operates in line with PLSA member views and in the interests of savers. Specifically, the DC work programme includes promoting improved pension adequacy, an effective value for money framework, supporting proposals to provide savers with more help at retirement and developing solutions to the proliferation of small pots.

The Future of DB: The PLSA will advocate for a DB landscape that allows for a wide range of options to ensure the payments of benefits to members. It will help open DB pension schemes to thrive and closed DB pension schemes to run on self-sufficiently or to consolidate into DB Master Trusts, Superfunds or to buyout with an insurer.

Tomorrow’s LGPS: For its Local Government Pension Scheme (LGPS) members, the PLSA will help support the orderly transition of fund assets into the eight pools, will produce practical guidance to help the scheme with challenges identified in a 2022 report by the PLSA, and will advocate for progress to continue on the ongoing Good Governance Project.

Engagement: On the theme of engagement, the PLSA will work on initiatives like the Pensions Dashboards, the Advice/Guidance Boundary and the Retirement Living Standards, which are aimed at promoting saver understanding and confidence with pensions.

Responsible Investment: The PLSA seeks to ensure the regulatory framework for investments operates in a way that supports pension funds in achieving their investment objectives whether related to good risk-adjusted returns, ESG investing or stewardship. In 2024 the PLSA will publish its annual Stewardship & Voting Guidelines and engage with a range of associated topics such as the Taskforce for Nature-related Financial Disclosures (TNFD), the ‘S’ in ESG and the Green Taxonomy initiative.

Governance and Administration: This theme is about ensuring trustees of pensions schemes, and their supporting teams, have the skills, knowledge and understanding to ensure the right pension is paid to the right people at the right time. Engaging with the Pension Trustee Skills, Capability and Culture consultation is a key pillar of this work.

In addition, The PLSA plans to draw its extensive existing policy views into a single document to make it clearer how it would like the pension landscape to look a decade from now – its Vision for 2035.

New Defined Contribution Committee Chair

At the same time as publishing its 2024 policy priorities, the PLSA also announces the appointment of Joanne Fairbairn as the new Chair of its Defined Contribution Committee.

The DC Committee is one of four Policy Committees which focus on specific policy issues for the distinct segments of the UK pensions landscape. These Committees advise the Policy Board, take forward delegated policy work and give representation to PLSA members from these sectors in PLSA policy development.

Fairbairn, who is client director at Zedra, replaces LCP’s Laura Myers, who became a Director on the PLSA Board at the end of 2023.

John Chilman, Chair, PLSA Policy Board, said: “The PLSA represents a diverse range of pension scheme members from across the defined benefit, defined contribution, Local Government Pension Scheme and Master Trust segments. As our busy work programme shows, there are a lot of regulatory and policy initiatives underway to ensure that the system is working as well as it can for savers. The PLSA Policy Board will continue to champion a policy framework that means people will have an adequate income in retirement and aim to ensure the regulatory and operating environment is appropriate for our members.”

Nigel Peaple, Director Policy & Advocacy, PLSA, said: “Next year will be another very busy one for the PLSA. Our work programme for next year carries over many of the initiatives we have been working on over several years, with some new projects and some re-prioritisation. As ever, we will continue to play an important part in raising standards, sharing best practice and ensuring pension schemes serve their members well.

“In this election year, the debate about how pension schemes can contribute to the UK economy will continue to dominate, while consolidation continues to be a big consideration for schemes of all types. We will continue to advocate for policy reform which addresses the pension adequacy problem.”

Cali Sullivan, PR Manager

020 7601 1761 | [email protected]

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