Thirty master trusts have submitted authorisation applications to The Pensions Regulator, while a further 10 have been granted a short extension, and are expected to submit applications in the coming weeks.
The deadline to submit an application has now closed, so this latest update from TPR confirms that of the 51 master trusts currently operating, eleven plan to exit the market.
Previously only eight master trusts had confirmed they would be exiting the market. This includes a number of smaller schemes like Welplan Pensions.
Three of these applications have already been approved. LifeSight — the run by Willis Towers Watson — was the first master trust to be authorised, with Legal & General WorkSave Mastertrust, and Legal & General Worksave Mastertrust (RAS) receiving authorisation on April 2.
TPR says this authorisation process puts safeguards around master trusts by ensuring they are run by fit and proper people and have the right systems, processes, plans and finances in place. It was widely anticipated that this would cause consolidation in the industry.
TPR executive director of frontline regulations Nicola Parish, Executive says: “Passing the end of the application window is an important step towards a market of authorised master trusts which millions of pension savers can have confidence in.
“We will now work to assess this large volume of applications and we are confident that we will process these applications within the time frames laid out in law. We always expected there to be a peak in applications and have planned accordingly.
“We look forward to the authorisation of more master trusts in the coming months and will be maintaining a close relationship with them as part of our supervision work to ensure these standards continue to be met.”
All existing master trusts had until 31 March 2019 to apply for authorisation, trigger their exit from the market or request an extension to the application period.