View more on these topics

L&G to offer ‘trustee style’ governance for contract-based pensions

Legal-and-General-LG-500x320.jpg

Legal & General has moved to close the perceived governance gap between trust and contract-based pensions by launching a “trustee style” committee to oversee the provider’s contract-based schemes.

The issue of scheme governance was brought to the fore by the Work and Pensions select committee recently, which urged the Government to help employers set up “governance committees” for contract-based pension schemes in response to concerns about a lack of protection for members.

Labour shadow pensions minister Gregg McClymont has also called for independent trustees to be installed in contract-based pension arrangements.

In response to this, L&G has launched a new governance structure, called independent governance oversight, designed to look after the interests of contract-based scheme members.

L&G says the IGO will mirror the governance structure of L&G’s WorkSave master trust and will initially focus on default funds. It says the IGO will be available to new and existing schemes at no extra cost.

The governance committee will be chaired by Paul Trickett, the former head of global portfolio solutions at Goldman Sachs Asset Management. 

Other committee members include Pitmans Trustees, an independent trustee firm, L&G managing director of workplace savings Tony Filbin and L&G head of scheme restructres Paul McBride.

All members of the IGO are paid by Legal & General.

Trickett says: “The current contrast in governance between trust-based schemes and contract schemes has been well publicised in recent times.

“Many contract schemes work with very high levels of governance, with the sponsor, their advisers and their chosen provider collaborating to the benefit of the members.

“But many others do not operate with such high standards and some schemes will be wholly reliant on the provider.

“To help bridge this governance gap, and to avoid the potential conflicts inherent in a system whereby only the provider is responsible, Legal & General is implementing a new governance structure called ‘independent governance oversight’.

“It is designed to work both with schemes’ own governance committees and to take sole responsibility where no other governance exists.”

Recommended

Advisers turning backs on big firms to go it alone

Scottish Widows says it is seeing an increasing number of advisers leave bigger companies to start up their own business. Speaking at a Perspective roundtable in London last week, head of distribution development Robert Kerr said the provider has noticed a shift away from the consolidation models established in the run-up to the RDR. He […]

1

Rise in paraplanners encouraging new learning and support services

Although adviser numbers have been falling since the launch of the RDR, paraplanner numbers have increased, encouraging the launch of new learning and support services for the profession. The Personal Finance Society Members Survey 2012 revealed that paraplanner numbers have grown in line with the organisation’s general membership, increasing from 1,644 paraplanners in 2010 to […]

11

Threesixty calls on Skandia and FundsNetwork to confirm platform trail stance

Threesixty Services is calling on Skandia and Fidelity Funds Network to confirm they will stop paying trail commission to advisers when the FCA’s platform legacy rules are implemented. In last month’s platform policy statement, the FCA said from April 2016 all legacy payments between fund managers and platforms will be banned but it does not […]

Newsletter

News and expert analysis straight to your inbox

Sign up

Comments

There is one comment at the moment, we would love to hear your opinion too.

  1. So L&G are dictating to employers? What if their service levels are appalling will they suggest a new provider. Will LGIM funds start appearing everywhere. This sounds very conflicted on face value.

Leave a comment