Value for Money (VfM) framework
Financial Conduct Authority consultation on the introduction of a ‘Value for Money’ (VfM) framework
LawDeb response led by Rekha Owen, Professional Trustee.
Rekha shares, “The FCA's consultation on the Value for Money Framework closed in October last year and we currently await the publication of a final policy statement as well as this summer's Pension Schemes Bill. Law Debenture's response to the consultation highlighted concerns on how the Framework could impact the viability of many well run single employer trust schemes due to the high reporting burden imposed by the Framework. At a PASA conference this week, similar concerns were shared, with a poll at the conference indicating that the majority of administrators believed introducing the Framework would require a large effort whilst delivering little improvement for employers and members.
Whilst we expressed some concerns about the proposed Framework in our response, we still do believe that driving providers to deliver good value is an important part of realising improved outcomes for the members of DC pension schemes. Equally as important is boosting levels of financial education, encouraging members to be more engaged with their pensions and simplifying the retirement planning process. Progress is being made in these areas too. Pensions Dashboards are edging closer to being a reality which should drive member engagement in their pensions. The FCA's Advice Guidance Boundary Review, we hope should help to facilitate targeted support to help members make better investment and retirement decisions.
But there's still a huge amount to be done. Having recently transferred a DC pension pot between providers I know personally how confusing and complicated pensions can seem - even to a veteran of the pensions industry! At Law Debenture, we're looking forward to continuing our engagement with regulators, government and industry so we can play our part in improving DC member outcomes.”
