Hargreaves Lansdown, Schroders and M&G have declined to comment on press reports that they are all actively considering launching a master trust to further boost their presence in the DC workplace pension market.
The report appeared in the FT today, and comes amid a drive for consolidation in the workplace pension market, with the government demanding that DC workplace schemes need to have a minimum of £25bn in assets by 2030. This drive to create so-called ‘mega funds’ will enable schemes to invest a broader range of assets, including private markets and to help drive up governance standards.
The report says that three big asset managers – Hargreaves Lansdown, Schroders and M&G – are exploring their options and may consider new trust structures to be more competitive in the DC market. The three providers have assets of more than £1.2 trillion between them.
The FT quoted an unnamed person involved in the discussions who said it was clear that master trust will be an important part of the UK pensions landscape in future, but it is hard to make that argument for contract-based schemes.
Hargreaves Lansdown and M&G only currently offer contract-based group personal pensions in the workplace market. Schroders does not run a stand-alone workplace pension scheme for other employers, although it operates as an asset manager on both DC and DB schemes, with growing expertise in the private markets arena.
When contacted by Corporate Adviser both Hargreaves Lansdown, Schroders and M&G said they would not be commenting on these reports.