UK - The defined contribution solutions market faces a major shake-up in 2003, leading consultants predict.
Hewitt Bacon & Woodrow principal consultant Lee Jagger believes companies will pull out of the market and refocus resources on other business areas and also on merger activity. This, he said, was due to changing demands from employers.
Mercer Human Resource Consulting European partner Jonathan Gainsford said: “Organisations are looking for a packaged solution or a packaged product.
“They are seeking something that is going to cover investment, administration and communication and it is a relatively limited number of people who can offer a fairly good packaged product in those areas.”
Gainsford also predicted that solution providers which put an emphasis on employee communications will enjoy most success.
Watson Wyatt partner Kevin Stratford believes companies which have specialised in managing defined benefit schemes will struggle to meet the demand of the DC market.
Stratford said: “Fund managers that have recognised the potential of bundled services have come into the marketplace to pick up the lion’s share in this type of business.”
The Pensions Regulator (TPR) has granted 11 master trusts extensions to apply for authorisation, as it confirms it has received 22 applications ahead of the 31 March deadline.
Aegon Master Trust, Fidelity Master Trust and Ensign have sent off their authorisation applications to The Pensions Regulator (TPR).
Self-administered pension funds spent £15bn on payments to pensioners in Q4 2018, but received just £12bn in contributions (net of refunds), Office for National Statistics (ONS) data reveals.
Aberdeen Standard Investments (ASI) and Gresham House are to team up to form a joint venture.