The Pensions Regulator (TPR) has confirmed that Willis Towers Watson’s LifeSight has become the first master trust authorised under new laws to implement tougher standards in the market.
Master trust authorisation was set up to strengthen protections for almost 14 million members in a growing market, which has more than £29bn in assets according to latest figures.
Nicola Parish, Executive Director of Frontline Regulation at TPR, said: “The first authorisation of a master trust is a landmark moment and a step towards a market of schemes with better safeguards around them.
“By the end of the year every master trust that continues to operate will have proven that its scheme and its trustees meet the standards laid out in the legislation and our code of practice. This will better protect the millions of members and billions of pounds in those schemes.
“Authorised master trusts are a good option both for employers looking to fulfil their automatic enrolment duties and for trustees of schemes who are looking to consolidate.”
Minister for Pensions and Financial Inclusion Guy Opperman said: “This is an important moment for the pensions industry. Authorisation will ensure master trusts – managing billions of pounds on behalf of millions of members – are strong, safe and deliver for workers.
“With record numbers saving for retirement, including millions through automatic enrolment, it’s vital to have the right protections in place across the board.”
Master trusts have to file applications to TPR outlining how a scheme meets the required standards. Under the legislation, master trusts must have fit and proper people running the scheme, sufficient financial reserves, robust systems and adequate plans in place to get authorisation and operate in the market.
Fiona Matthews, Managing Director of LifeSight said: “We are thrilled to be blazing a trail for master trusts and receive this formal regulatory approval of the work LifeSight does. Being the first master trust to reach this landmark is a testament to the service we offer our members and clients, giving them the assurance that they are with the right provider. We expect that authorisation will give schemes that have been waiting and watching developments the confidence to make the switch to master trust.
“We will continue to develop the LifeSight offering within this new framework, improving our credentials to existing and prospective clients as we did last year increasing the ESG coverage in the investment strategy.”