The worrying lack of regulatory controls on master trusts has been exposed by Channel 4’s investigative programme Dispatches.
In an episode aired last night, the programme revealed misleading and incorrect information touted by master trusts promoted for use as automatic enrolment schemes.
One scheme, MyWorkplacePension, carried a claim on its website until February that funds were managed by Old Mutual, however the provider had no involvement with the firm.
Workplace Pension Trustees told Dispatches the original wording was included when they intended the funds would be managed by Old Mutual. One of the founding directors of MyWorkplacePension also founded a sportswear company called Wide-Boys-R-Us.
Another scheme claimed it could provide “long term growth with a forecast average yield of 8 per cent per year”.
In May the Government announced a Pensions Bill that is set to include a clampdown on master trusts.
However, there are concerns the Cabinet reshuffle and Brexit vote could push the issue down the Government’s agenda.
The DWP told Dispatches: “Master trusts are already subject to a number of regulatory requirement under existing pensions law and are regulated by the Pension Regulator. We also want to make sure that these schemes have safeguards, which is why we are looking to introduce new protections in the Pensions Bill this autumn.”