Fidelity International’s FutureWise default has now surpassed the £25bn in assets under management – the ‘megafund’ target required under the Pensions Schemes Act
FutureWise, the default for Fidelity’s DC workplace pension scheme, adopted a target date structure in 2022, and since then has grown from £6.5bn to over £25bn.
The new Pensions Schemes Act requires DC workplace scheme to have at least £25bn in their mainscale default by 2030, or to be at least £10bn with a credible path to reaching this target by 2035.
Yesterday L&G also revealed that its main LAF default had surpassed the £25bn target. Corporate Adviser’s recent Master Trust and GPP report revealed that seven providers — including large AE providers such as Nest and People’s Pension — already have a single default with more than £25bn of assets.
This new Government minimum target has been set to drive further consolidation across the DC sector, with the aim of enabling schemes to diversify and invest greater allocations into private markets.
Fidelity International is one of the few UK workplace providers not to sign the voluntary Mansion House Accord, where UK workplace schemes have pledged to invest at least 10 per cent of their default assets into private markets, half of which will be in the UK.
However as part of today’s update on AUM, Fidelity gave further details about its own private markets strategy.
FutureWise became the first investor in Fidelity’s Diversified Private Assets Long-Term Asset Fund (LTAF) in early 2025, following the LTAF’s launch, with exposure set to increase gradually over a three-year period, targeting a 15 per cent allocation to the LTAF during the growth phase for pension savers.
Fidelity has also unveiled its private markets partner network, a group of global general partners (GPs) selected by Fidelity’s experienced investment team and invested in by the LTAF.
This network is designed to offer diversified and specialist exposure across different private market asset classes. The first 10 GPs selected by the LTAF span private equity, private credit, infrastructure and real estate – with additional partnerships expected as the allocation scales toward its long-term target.
This phased implementation is designed to broaden the investment opportunity set available to members, enhance portfolio diversification, and support improved risk-adjusted outcomes over the long term.
Fidelity International investment director for FutureWise James Monk says the growth of this strategy reflects “strong demand for a simplified, outcome-focused default solution”.
He adds: “Moving to a TDF structure has enabled us to accelerate innovation, enhance governance and deliver a clearer investment journey for members to-and-through retirement.
“Having recently marked three years since adopting the TDF structure, this latest milestone demonstrates the strength and scalability of the strategy. Indeed, we expect FutureWise to exceed £40bn of assets by 2030 through continued organic growth, reinforcing its position to meet the scale threshold set out in the Pension Schemes Act.”
Vivian Liu, head of private markets portfolio management at Fidelity International adds: “More than one year on from the launch of the Fidelity Diversified Private Assets LTAF, we are pleased to unveil our private markets partner network.
We have carefully selected a group of specialist GPs to provide diversified exposure across private markets. By combining their sector expertise with Fidelity’s portfolio construction, governance and long-term oversight capabilities, we are delivering institutional-quality private markets access within a structure purpose-built to improve long-term outcomes.”