Chancellor unveils plans to force DC pension plans to disclose levels of UK investment

investmentweek.co.uk:

Chancellor Jeremy Hunt (pictured), said: 'These new rules mean employers and savers can see how their money is invested and how the returns compare to other schemes.' || Credit: HM Treasury

Under the chancellor's plans, which have been announced by HM Treasury ahead of this week's Spring Budget, DC funds would be required to disclose their levels of investment in British businesses, as well as their costs and net investment returns.

They would also need to publicly compare their performance data against competitor schemes, including at least two strategies managing at least £10bn in assets.

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In addition, poorly performing schemes would not be allowed to take on new business from employers — with The Pensions Regulator and the Financial Conduct Authority being given a «full range» of intervention powers.

HM Treasury said while the rollout of auto-enrolment (AE) has resulted in a substantial increase in the amount of investment UK pension funds can deploy, from £90bn in 2012 to approximately £116bn in 2022, the current disclosure requirements for DC pension funds were «inconsistent» and do not require a breakdown of their UK investments.

It added, this made it difficult for policymakers and members to understand where assets were invested — noting that by ensuring pension funds disclose where they invest and the returns they can offer members, it would make it possible for employers and savers to compare schemes to make «informed choices».

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HM Treasury said the measures came as part of its broader value for money framework (VfM) reforms to improve the outcomes for savers and