FCA has made its final rules on how Independent Governance Committees and Governance Advisory Arrangements should work to compare the value of pension products and services to promote the best value for money on workplace pensions for their members. FCA has specified a definition of value for money in this context and the three key elements (costs and charges, investment performance and quality of services) that a pension provider’s IGC or GAA should take into account when assessing it. IGCs should also compare their provider’s offerings with similar propositions on the market.
The rules took effect on 4 October and firms and IGCs have until the end of September 2022 to publish their next report.
Separately, FCA and the Pensions Regulator are seeking views on prescribing metrics or benchmarks for the three elements of VFM. They ask for views by 10 December.