Corporate Adviser
  • Content Hubs
  • Magazine
  • Alerts
  • Events
  • Video
    • Master Trust Conference 2024 videos
  • Research & Guides
  • About
  • Contact
  • Home
  • News
  • In Depth
  • Profile
  • Pensions
    • Auto-enrolment
    • DB
    • DC
    • Defaults
    • Investment
    • Master Trusts
    • Sipps & SSAS
    • Taxation
  • Group Risk
    • Group Life
    • Group IP
    • Group CIC
    • Mental Health
    • Rehab
    • Wellbeing
  • Healthcare
    • Musculoskeletal
    • Mental Health
    • IPT
    • Wellbeing
    • Trusts
    • Cash Plans
  • Wellbeing
    • Mental Health
    • Health & Wellbeing
    • Financial resilience
  • ESG
No Result
View All Result
Corporate Adviser
No Result
View All Result

Four master trusts costing £200m a year – PPI research

by John Greenwood
August 27, 2020
Share on FacebookShare on TwitterShare on LinkedInShare on Pinterest

The cost of running the four biggest master trusts in the UK is £200m a year and costs across the master trust sector will rise to around £1bn a year by 2035, according to research from the Pensions Policy Institute (PPI).
The research, which analyses the costs of Nest, The People’s Pension, Now: Pensions and Legal & General’s WorkSave Master Trust, predicts that master trust providers will not achieve break-even point until around 2025, after which profits may accelerate, subject to competition between providers through reducing charges.
But the sector faces unknown headwinds, with data cleansing for the dashboard, the growing number of small pots and the unpredictable impact of Covid-19 all potentially impacting profitability.
The PPI says £1bn has been spent on running the four big auto-enrolment schemes over the last decade. Much of the growth in costs is due to the cost of investment management, which is linked to the size of funds. The PPI research predicts that annual costs will rise to around £1bn a year by 2035. While investmnent management costs only represent a small proportion of this cost at present, growing fund sizes mean this will rise to almost half the overall cost 15 years from now.
The greatest challenge to the financial sustainability of master trusts is the need to cover initial start-up and running costs until levels of membership and assets have grown sufficiently, says the report, which was commissioned by Now: Pensions.
The report argues consolidation of multiple pots belonging to a single member could help to make master trust running costs more efficient.

Corporate Adviser Special Report

REQUEST YOUR COPY

Most Popular

  • Parallel launches free benefits platform for SMEs

  • Scottish Widows appoints former regulator as master trust trustee

  • L&G exceeds £100bn in workplace assets under administration

  • Midlife workers face rising health concerns but fail to act: research

  • Standard Life completes £1.9bn bulk purchase annuity for Marsh McLennan pension

  • Rise in cost of pensions tax relief fuels further Budget speculation

Corporate Adviser

© 2017-2024 Definite Article Media Limited. Design by 71 Media Limited.

  • About
  • Advertise
  • Privacy policy
  • T&Cs
  • Contact

Follow Us

X
No Result
View All Result
  • Home
  • News
  • In Depth
  • Profile
  • Pensions
    • Auto-enrolment
    • DB
    • DC
    • Defaults
    • Investment
    • Master Trusts
    • Sipps & SSAS
    • Taxation
  • Group Risk
    • Group Life
    • Group IP
    • Group CIC
    • Mental Health
    • Rehab
    • Wellbeing
  • Healthcare
    • Musculoskeletal
    • Mental Health
    • IPT
    • Wellbeing
    • Trusts
    • Cash Plans
  • Wellbeing
    • Mental Health
    • Health & Wellbeing
    • Financial resilience
  • ESG

No Result
View All Result
  • Home
  • News
  • In Depth
  • Profile
  • Pensions
    • Auto-enrolment
    • DB
    • DC
    • Defaults
    • Investment
    • Master Trusts
    • Sipps & SSAS
    • Taxation
  • Group Risk
    • Group Life
    • Group IP
    • Group CIC
    • Mental Health
    • Rehab
    • Wellbeing
  • Healthcare
    • Musculoskeletal
    • Mental Health
    • IPT
    • Wellbeing
    • Trusts
    • Cash Plans
  • Wellbeing
    • Mental Health
    • Health & Wellbeing
    • Financial resilience
  • ESG

This website uses cookies. By continuing to use this website you are giving consent to cookies being used. Visit our Privacy and Cookie Policy.