What reasons do schemes have for considering master trusts?

With an ever-increasing compliance burden and rapidly growing assets, particularly defined contribution (DC) assets, many companies (and some trustee boards) no longer have the resource, expertise or desire to carry on managing their own schemes. They are looking to master trusts in particular because they’re seen as a high quality, well-governed option.

Other reasons for considering master trusts include a need to reduce employer costs, a desire to improve member engagement levels with pensions and provide a more comprehensive communications experience, or a wish to reshape the pension arrangements, for example, by transferring tranches of legacy deferred members or set up a new DC scheme.