Thanks to Colin Stewart , Chair of Royal London’s Independent Governance Committee. These reports have been running since 2016 so this is the 10th anniversary and the 11th time I’ve reported on Royal London.

This is an excellent report (though please fix or take down the video introduction Colin, it doesn’t play and you can’t display it as there is not embed code) -it’s a good idea badly executed.

Contract charges (for instance for those in drawdown)

If value were solely measured by charges, Royal London could claim to have across the board , improved VFM. It isn’t of course but it is telling that Royal London have brought charges down since the end of AE staging substantially

Royal London is a mutual, that means it returns some of the money it makes to policy holders. Here’s an example from the report

This is good stuff. Like the other mutual left providing DC pensions (People’s Pension), there is money flowing back to member’s retirement fund through reduced charges.

Much of what Royal London has written as personal pension business is not covered by a 075% charge and has a charge of 1% pa. Their four “Investment pathways” are types of drawdown returning money to those have Royal London pots.  The more you bring to be spent, the more your rebate of charges you have paid.

Charges are lowered currently as shown. Since the policies are written under a contract  , this seems sensible. Employers and Trustees are not involved in the benefits of mutuality. There are no trustees, in the sense most  workplace pensions have them and the deal is with the saver.

But Colin Stewart must be frustrated that this report arrived in October 2026 and reports what happened last year (2026). So much has happened in the past 1o months and policyholders are entitle to be kept up to date.

Investments

Although investment performance is much more important to member outcomes than charges, investment comes second in the report and I suspect that most readers will see that as the importance to their understanding of VFM. Investment is still driving employer and sophisticated employee’s understanding of VFM

It is very hard to gauge what has actually happened to policy holder’s money over the last five years as there are lots of defaults.

My understanding is that retirement solutions are policies building the pot, longstanding policies are what are elsewhere called “legacy” and “investment solutions” are policies in drawdown (being spent). The ratings out of 100 above, refer to people’s satisfaction with the policy (this is a measure for “value for money”.

There are , for those building and spending their pots, four different default strategies that savers can choose or that can be chosen for them (by employers or advisers). They are all beating the rate of return expected over the five years to the end of 2025. I am sure this means something to those for whom this section is really written, the FCA that’s busy getting a more complicated reporting on this but I have to admit I got a little lost here.

When presented in a table we get a little more understanding but this looks targeted at IFAs and employers and of course the FCA as regulator.

I’m prepared to accept Colin’s view on the value policyholder’s are getting from the investment of their pots , though whether such an opinion ever can be truly “independent”, I doubt.

Communication

I guess we take the IGC report as a proxy for the company’s attitude to communicating to the various stakeholders it’s talking to.

Here it is hardest for Royal London to convince the IGC Committee that it is fulfilling its responsibility to members. Royal London has put its trust in IFAs who are responsible for most of the employer decisions on workplace pensions. The communication that is being paid for by employers should be to advisers but this is rarely happening as considered by the former CEO Phil Loney when most workplace pensions were sold.

Royal London has had to take on this responsibility when it is no longer being the responsibility of IFAs I can see why Royal London is belatedly getting into Bulk Purchase Annuities. There is no such uncertainty there!

Conclusion

Royal London is uniquely a workplace pension provider which operates only GPPs. It will survive the threats to master trusts operating in the workplace space from requirements to show £10 and then £25bn in assets. It will do so, because it can take its legacy and self-employed personal pension portfolio into its estimate of its total assets under management.

But it makes it very hard for Royal London going forward to write new business, competing as it with master trusts and in future CDCs. These more collective schemes will be looking to take on employers using Royal London personal pensions.

As a decent firm that has not sold out to American insurers/private equity, I admire it and wish it well.

I am glad Royal London invests in its IGC and that it operates as mutuals should. I hope its stakeholders allow it to go forward as most insurers saw themselves doing when auto-enrolment began. But it will be a struggle to continue as it is today.

I hope that my comments are seen as supportive, despite my worries. It is good to see the new IGC Chair being proactive in promoting his IGC.