“Chapeau” Cushon
What Cushon has achieved in merging Workers Pension Trust into the Cushon trust is truly outstanding and sets the benchmark for consolidators going forward. According to its press release we learn that the consolidation – an intra-group merger – marks the first time an acquired master trust has been merged into another under the ‘continuity option 1′ in the Pension Schemes Act 2017.
Since its acquisition in 2021, the WPT Master Trust has operated separately, with independent trustee boards. Following the merger, the Northern Irish auto-enrolment provider’s assets and members are now part of the larger Cushon Master Trust under the governance of its board of trustees.
Cushon – which has £2.3bn in assets under management – said the merger is the “first key step” to fully consolidating members and providing them with access to Cushon’s technology platform to enable them to connect with their pension savings.
Cushon Master Trust chair Roger Mattingly added:
“The merger of WPT into Cushon Master Trust is a first step on the consolidation journey. By consolidating two large workplace pension arrangements, the resources and financial support available to the Cushon Master Trust grows. This gives the board of trustees new opportunities to add value, with the aim of driving better outcomes.
“Members will not see immediate changes. However, as they are migrated to the Cushon platform in the coming months, they will gain access to Cushon’s app. Following the current review of the default and self-select funds, we anticipate that in the future, the WPT investments will likely switch to the Cushon sustainable investment strategy.”
Cushon founder and chief executive Ben Pollard said:
“Cushon is walking the walk when it comes to consolidation. In just over three years we have acquired three master trusts. Acquiring master trusts is only the first step in the consolidation journey.
“The real win is merging them to create greater scale which is a good thing for pension savers. This merger is the first of its kind and with it Cushon is creating the blueprint for further industry consolidation.”
A few observations
It has taken the best part of three years for this to happen, that doesn’t suggest lethargy, it tells us just how hard it is to integrate different governance, different investment strategies and differing member experiences.
The work is not completed, we hear that the investments of differing groups of Cushon members will remain discreet , till the two defaults are merged.
The merger will be to Cushon’s superior sustainable investment strategy, not their shonky low-cost alternative (good news for savers).
It’s been over a year since TPR approved this deal and the timeframes reflect not just the complexity of the processes , but that this is breaking new ground.
Cushon will have kicked down a lot of doors to get here, they have two more schemes to consolidate including the Creative Master Trust – there are many yet to be digested master trusts within other consolidators.
Cushon look like they’ve done their sector a favour, and a favour to former Worker’s Pension Trust members
Well done Cushon! This demonstates that Continuity Strategy 1 does actually work. Which is really good news for anyone in a master trust that is swallowed up by a bigger fish – they should in time become members of the bigger fish on equal status with the others. I feel sure that the timescales will come down for future exercises – it really should be possible to complete the whole process well within 24 months, right down to the last trustee turning out the lights and cancelling the milk.