The Investment Association has called for greater collaboration between investment managers and pension schemes, saying the investment process must be ‘front and centre’ for defined contribution pensions.
In a report released today, the IA is also calling for greater transparency of investment costs allowing savers to better assess value for money in DC investment.
IA chief executive Chris Cummings says measures ensuring DC schemes can invest across a full range of asset classes should be a priority.
He says: “Investment needs to have the same priority in all forms of pension – whether defined benefit or DC, so industry, regulators and government need to build confidence in pensions saving and find new ways to increase engagement.”
Included in the IA’s recommendations is a partnership between pension schemes and the investment management industry.
The IA says savers need a clearer objective so they understand the direct correlation between saving and the personal benefits of their pension.
Cummings says: “Without long-term returns, schemes do not have an effective way to facilitate good retirement outcomes. And without long-term finance, the economy cannot produce those returns and contribute to wider prosperity.”
He adds: “The amount people are saving is in many cases still too little to ensure a secure retirement and so in order to achieve the best outcomes for both new and existing savers, the investment process needs to be front and center.”