The government will proceed with a range of changes to the investment consultant and fiduciary management markets as recommended by a major competition review.
The Department for Work and Pensions (DWP), the Treasury, and The Pensions Regulator (TPR), today (12 March) confirmed they would take forward three key changes suggested by the Competition and Markets Authority (CMA) in December.
The watchdog's reforms are aimed at improving trustee information, trustee duties, and scrutiny of the market, and form part of a package of 12 measures, including mandatory tendering for first-time fiduciary management mandates covering at least 20% of scheme assets.
The movement was confirmed in a letter to the CMA from pensions and financial inclusion minister Guy Opperman, economic secretary to the Treasury John Glen, and TPR executive director of regulatory policy, analysis and advice, David Fairs.
The DWP will put together draft regulations on allowing TPR to monitor compliance with the broader CMA remedies, and consult on them later this year, with an aim for them to be enforced sometime next year.
TPR will also, this summer, consult on guidance aimed at trustees relating to how to run competitive tender processes for fiduciary management.
Finally, the Treasury plans to consult on extending the Financial Conduct Authority's regulatory perimeter to encompass the activities of investment consultants, although it set out no timeframe due to "competing priorities for both the government and the financial services sector".
The government said the reforms will "benefit savers and boost £1.6trn of pension assets".
Welcoming the reforms, Opperman said they would have a "positive impact on millions of people's pension pots".
"The market sometimes restricts trustees' abilities to find the best value for money, meaning that defined benefit schemes are less affordable and more difficult to fund while defined contribution schemes face higher costs and reduced returns for members," he continued.
"We want trustees to be better equipped and engaged when accessing services which have a huge influence on decisions affecting how much their members will have to live on in retirement."
The movement comes as the CMA's consultation on its draft order for certain remedies closes to responses tomorrow (13 March), with these expected to be enforced later this year.
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