Governance Committees of Contract-based DC Arrangements
With effect from April 2015 the providers of workplace personal pensions have been required to set up and maintain independent governance committees (IGCs). IGCs will have a duty to act in the interests of scheme members and will operate independently of the firm. They will assess and where necessary, raise concerns about the value for money of workplace personal pension schemes.
Employers have a choice about the kind of pension they make available for their employees – with some choosing to use schemes based on a trust with trustees. Others choose schemes provided by insurance companies which result in contracts between the providers and the employees. Known as contract-based schemes, these workplace personal pension schemes include personal pension schemes and stakeholder pension schemes which employers use for auto enrolment of otherwise make available to their employees.
The Financial Conduct Authority has been working with the Department for Work and Pensions and the Pensions Regulator to help ensure minimum standards for all workplace pensions – whether trust or contract based.
We have significant experience of serving on and chairing governance committees and can share our experience and help get the best out of governance committees.