Commenting on the FCA’s launch of its 'Driving value for money in pensions' consultation, Laura Andrikopoulos, Head of Governance Consulting, Hymans Robertson, says:

“We welcome the FCA’s launch of a consultation looking into how Independent Governance Committees (IGCs) compare value for money (VFM) in occupational pension schemes. VFM has become a familiar term across occupational pensions so the ability to make these comparisons will be useful for the industry.  The move towards a standardised format to assess VFM is one that may well help drive greater independence of IGCs.  We also welcome the increased collaboration with TPR to ensure VFM requirements share similar principles across both Trust and Contract based arrangements.

It is vital however, that with the introduction of any changes, focus is not lost on member outcomes, which is critical to the assessment of long-term “value”. Value is not only about cost, but should be a holistic assessment taking into account the quality provided for that cost, levels of company contributions, and the ultimate outcome achieved through smart investment strategies and good retirement support. Concentration on governance regulation and cost through VFM should not come at the expense of these outcomes.”