The PLSA has commented on the government’s response to the ‘Improving outcomes for members of defined contribution pension schemes’ consultation.
Joe Dabrowski, Deputy Director, Policy, PLSA, said: “We agree that it’s important the government considers what ‘good’ looks like in the future DC market and whether creative ideas should be considered that go beyond fewer, bigger schemes being the only answer.
“Consolidation or scheme scale should not be an end in and of itself. Though we agree that there can be benefits to scale in terms of governance, access to expertise and availability of particular investment approaches, it is quality – and not the size of the scheme – which matters. We know from our wider membership and experience with the Pensions Quality Mark that good DC provision can come in many forms. Quality could include scheme benefits and guarantees that are available to members of smaller schemes, and the costs of wind-up should receive due attention. It is possible that these could be met by the trusts’ funds.
“While costs and charges have a real impact on members’ funds, value for money in pensions needs to be seen in the round and should not be reduced to a discussion about cost alone. Well governed schemes are able to deliver value for money for their members regardless of pot size.”
Mark Smith, Senior PR Manager
020 7601 1726 | [email protected]k
Steven Kennedy, PR Manager
020 7601 1737 | 07713 073024 | [email protected]