The King’s speech, which laid out the new Labour government’s legislative priorities, contained details of a Pension Schemes Bill which would consolidate small pensions pots; test the value for money of schemes; oblige occupational pension schemes to offer new ‘retirement solutions’ and remove the requirement for courts to enforce decisions by The Pensions Ombudsman (TPO).

The focus on consolidation in the pensions market provides will support over 15 million people who save in private-sector pension schemes get better outcomes from their pension asset important continuity. The proposed requirement on occupational pension schemes to offer new retirement products, so that members have a pension, not just a savings pot, marks a recognition that pensioners need a higher degree of retirement security than current drawdown products provide. Clearly, keeping assets invested in pension schemes for longer would also support the government’s plans for pension scheme investment to drive economic growth.

Consolidation of defined benefit schemes through superfunds will protect savers from the risk of losing part of their pension if a company goes insolvent, and changes to the rules of the Pension Protection Fund and Financial Assistance Scheme will allow more people with terminal illnesses to receive a lump sum at an earlier stage.

It introduces a standardised test for trust based defined contribution schemes aimed at ensuring schemes deliver value for money to savers. “This should result in consolidation in the pensions market by leaving a smaller number of well-performing, well governed schemes which will not only improve outcomes for savers but is likely to lead to more productive investment of funds,” said the government’s statement about the law.

The Bill proposes measures to bring a person’s small defined contribution pension pots together automatically to “maximise income in retirement and deliver value for every saver”.

My personal response.

As a 62 year old with a DC pot, I look forward to being able to turn my pot into a pension by transferring into an occupational pension scheme. I am talking on behalf of Pension SuperHaven with a number of master trusts with a view to offering not an annuity but a scheme pension through these schemes that will provide me with a certain lifetime income 10-15% higher than were I to buy out my pot with an insurer.

In May of this year, I wrote to the Labour policy team (at their request) explaining how this could work and I am glad to see that both in substance and style, the Government’s statements echo the paper which is downloadable from the following link or readable below.

Our corporate response

Speaking as a Director of AgeWage and also a Director of Pension SuperFund Holdings, I fully endorse the statements of Edi Truell which can be read from this link or readable below.

Pension SuperFund Capital whole heartedly endorses the inspiring and forward-thinking agenda for pensions as outlined in His Majesty the King’s speech today. His Majesty’s vision for a secure pension for all at retirement and the consolidation of Defined Benefit (“DB”) pensions into commercial superfunds aligns perfectly with our core mission and operations.

Edi Truell, Founder at Pension SuperFund Capital, commented:

“We are thrilled with his Majesty’s commitment to pension security and economic growth. At Pension SuperFund Capital, we are fully prepared to lead the way for these long-term objectives, providing a ‘pension for life with shared upsides’, consolidating DB pensions into superfund structures and channelling savings into productive investments through our Long Term Assets II vehicle.”

At Pension SuperFund Capital, we have long championed these very important causes. Our innovative vision for pension consolidation can ensure that DB pensions are managed both efficiently and sustainably, securing the financial future for thousands of pensioners.

We believe, as His Majesty does, that commercial superfunds are a key instrument in achieving this goal. We trust that the Pensions Regulator will now amend its guidelines to address the shortcomings in the current guidance offered.

Pension SuperFund Capital has already invested significant time and capital to launch and develop Pension SuperHaven, a ‘pension for life with shared upsides’. This will seek to address the continuing conundrum in respect of how Defined Benefit (“DC”) pension pots can be translated into proper pensions rather than giving individuals, who rarely have the expertise, the headache of investment selection to ensure that their money doesn’t run out.

His Majesty also highlighted the critical role of pension savings in driving economic growth through investment in productive assets. Pension SuperFund Capital is proud to be at the forefront of this initiative with its Long Term Assets II (“LTA II”) vehicle. LTA II is specifically designed to invest pension savings in long-term, productive assets, generating stable returns for pensioners while also contributing to the nation’s economic vitality.

LTA II has been established as a robust, and well-governed vehicle to fulfil this crucial
mandate, with market-leading, value for money investment management and a 30-year track record that stands comparison with the very best in the industry.
Pension SuperFund Capital is dedicated to working closely with policymakers, industry partners and stakeholders to implement the King’s vision outlined. We believe that through collaboration and innovation, we can build a pension system that not only provides security but also drives economic progress.”

The King actually starts speaking at 11.30 minutes.