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Workplace pensions provider to cut fees to benefit members

Leading not-for-profit workplace pensions provider to cut fees as it returns profits to members, saving them thousands more across their lifetime

The People’s Pension¹, a leading, not-for-profit workplace pension provider, has today revealed plans to return profits to members by cutting fees, potentially saving people thousands more towards their retirement.

With auto-enrolment maturing, pension pots growing, and contributions set to rise further to eight per cent from April this year, the rapidly growing master trust will this summer move from its already low-cost AMC of 0.5 per cent to a banded pricing structure. Member charges as a percentage, will fall as their pension pots grow, giving them a long-term incentive to stick with auto-enrolment saving and to consolidate multiple pots.

The new pricing structure immediately reduces the fee revenue which The People’s Pension receives from its membership’s Annual Management Charges (AMC) by 10 per cent.

An average earner saving over their working life with The People’s Pension could see their lifetime AMC fall by more than half to just 0.23%², potentially increasing their pension pot at retirement by:

almost £55 000 when compared to a lifetime fee set at the charge cap of 0.75% – nearly five years additional retirement income³
almost £30 000 when compared to a lifetime fee set at the already low 0.50% which members of The People’s Pension currently pay – nearly three years additional retirement income⁴

A member’s AMC will reduce as their savings increase through the following bands⁵, with the charge they pay shown simply and transparently in pounds and pence each month in their online account.

Commenting on this announcement, Patrick Heath-Lay, CEO of B&CE, provider of The People’s Pension, said:

“Auto-enrolment is on the cusp of a significant landmark, with contributions set to rise for 10 million savers across the UK. Providers need to respond imaginatively to ensure auto-enrolment is attractive over the long-term, rewards people for saving and incentivises the consolidation of multiple pots.

“Charges can eat away at pensions, and on a flat-rate, percentage fee savers pay a lot more in pounds and pence the more they save. We’re reducing members annual charges as a percentage of their savings in line with the growth of their pot, potentially boosting their retirement income by thousands.

“The People’s Pension led the auto-enrolment market by offering all employers, whether large or small, the same uniform single charging structure for their employees, removing a sense of unfairness in industry charging practices. We’re taking this approach further by offering all members the same clear incentive to save for the long-term. We urge the industry to follow suit.”

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Notes to Editors

The People’s Pension is a leading, not-for-profit master trust (multi-employer pension scheme), provided by B&CE. Since its creation in 2012 it has grown to serve more than 4 million members and more than 85,000 employers across the UK. Assets under management are £5.7bn. Accurate at 21 February 2019. We tweet as @peoplespension.
All modelling assumes:
- earnings £30,000 per annum (UK media fulltime annualised wage £29,588, ONS 2018)
- timeframe 45 years
- contributions at 8% of qualifying earnings
- investment returns 5% per annum
- inflation 2.5% per annum

Earnings: £10,000 per annum

Year	TPP New Charges	TPP New Fund value	TPP New average lifetime AMC	TPP Old Charges	TPP Old Fund value	0.75% Charges	0.75% Fund value
5	£21.83	£1,852.18	0.5%	£21.83	£1,852.18	£32.61	£1,840.49
10	£95.90	£4,379.30	0.5%	£97.54	£4,377.60	£145.04	£4,321.67
15	£230.66	£7,827.98	0.47%	£247.03	£7,809.49	£365.62	£7,658.06
20	£442.77	£12,476.47	0.45%	£496.09	£12,411.64	£730.64	£12,087.07
25	£738.57	£18,698.27	0.42%	£877.93	£18,518.95	£1,286.35	£17,906.88
30	£1,141.62	£26,958.98	0.40%	£1,435.18	£26,555.94	£2,091.53	£25,491.36
35	£1,670.03	£37,867.64	0.37%	£2,222.42	£37,059.98	£3,220.68	£35,308.70
40	£2,354.60	£52,199.25	0.35%	£3,309.36	£50,710.52	£4,767.90	£47,944.40
45	£3,217.18	£70,965.01	0.33%	£4,784.79	£68,365.76	£6,851.87	£64,129.98

Earnings: £23,000 per annum

Year	TPP New Charges	TPP New Fund value	TPP New average lifetime AMC	TPP Old Charges	TPP Old Fund value	0.75% Charges	0.75% Fund value
5	£88.10	£8, 084.63	0.47%	£95.21	£8,077.19	£142.21	£8,026.20
10	£350.67	£19,174.03	0.42%	£425.34	£19,090.32	£632.50	£18,846.41
15	£803.21	£34,385.93	0.37%	£1,077.28	£34,056.46	£1,594.44	£33,396.09
20	£1,479.65	£55,007.37	0.34%	£2,163.42	£54,126.04	£3,186.24	£52,710.63
25	£2,411.75	£82,712.31	0.31%	£3,828.57	£80,759.49	£5,609.64	£78,090.29
30	£3,664.23	£119,637.11	0.29%	£6,258.68	£115,808.07	£9,120.99	£111,165.55
35	£5,342.13	£168,503.30	0.27%	£9,691.78	£161,615.23	£14,045.09	£153,978.05
40	£7,581.27	£232,798.66	0.26%	£14,431.82	£221,144.01	£20,792.40	£209.081.23
45	£10,556.99	£316,988.62	0.24%	£20,866.02	£298,136.94	£29,880.41	£279,665.07

Earnings: £30,000 per annum

Year	TPP New Charges	TPP New Fund value	TPP New average lifetime AMC	TPP Old Charges	TPP Old Fund value	0.75% Charges	0.75% Fund value
5	£120.32	£11,444.33	0.45%	£134.72	£11,429.11	£201.23	£11,356.96
10	£466.33	£27,165.72	0.39%	£601.85	£27,012.55	£894.98	£26,667.42
15	£1,059.14	£48,753.62	0.35%	£1,524.34	£48,189.45	£2,256.11	£47,255.04
20	£1,935.82	£78,050.20	0.31%	£3,061.21	£76,587.64	£4,508.49	£74,584.85
25	£3,152.93	£117,428.82	0.29%	£5,417.38	£114,273.63	£7,937.57	£110,496.75
30	£4,825.37	£169,901.18	0.27%	£8,855.95	£163,866.90	£12,906.08	£157,297.80
35	£7,102.29	£239,331.13	0.25%	£13,713.74	£228,683.44	£19,873.62	£217,876.93
40	£10,176.59	£330,670.29	0.24%	£20,420.83	£312,915.89	£29,420.97	£295,847.21
45	£14,297.21	£450,258.02	0.23%	£29,525.15	£421,859.88	£42,280.39	£395,722.42

Earnings: £45,000 per annum

Year	TPP New Charges	TPP New Fund value	TPP New average lifetime AMC	TPP Old Charges	TPP Old Fund value	0.75% Charges	0.75% Fund value
5	£180.69	£18,652.83	0.42%	£219.38	£18,611.81	£327.69	£18,494.32
10	£688.08	£44,321.46	0.35%	£980.09	£43,988.76	£1,457.44	£43,426.74
15	£1,546.78	£79,619.06	0.31%	£2,482.32	£78,474.42	£3,673.98	£76,952.77
20	£2,819.28	£127,567.15	0.28%	£4,985.05	£124,719.63	£7,341.88	£121,458.18
25	£4,648.70	£191,998.52	0.26%	£8,821.97	£186,089.63	£12,925.98	£179,939.15
30	£7,223.06	£277,835.03	0.25%	£14,421.53	£266,850.13	£21,016.99	£256,152.63
35	£10,786.14	£391,391.12	0.23%	£22,332.24	£372,401.03	£32,363.33	£354,803.11
40	£15,653.27	£540,758.69	0.23%	£33,254.44	£509,569.92	£47,910.77	£481,774.31
45	£22,231.36	£736,297.16	0.22%	£48,080.42	£686,980.47	£68,851.78	£644,416.76

For the average earner the new charge structure could enable them to save an extra £54,535.60 compared to paying a flat rate AMC of 0.75%. Assuming the average earner requires 2/3rds of their salary as a retirement income and receives a full state pension of 8,767.20 a year (2019/20 prices), the £54,535.60 equals roughly five years additional retirement income.
For the average earner the new charge structure could enable them to save an extra £28,398.14 compared to our current flat-rate AMC of 0.5%. Assuming the average earner requires 2/3rds of their salary as a retirement income and receives a full state pension of 8,767.20 a year (2019/20 prices), the £30,000 equals roughly three years additional retirement income.
So for example if a member’s pension pot is worth £8,000, the banded AMC would be calculated as:

Therefore, the monetary charge would be £35.00, and the equivalent AMC would be 0.44%.

B&CE appoints Stella Beale as Director of Marketing

Stella previously held roles at Mercer Consulting where she was European Marketing Leader-Investments & Retirement, as well as a range of marketing and customer focused roles at MetLife Assurance, Legal & General, RBS and American Express.

Stella is responsible for developing the marketing, events and brand strategic plans to generate positive brand awareness across B&CE’s money and health business areas.

Commenting on her appointment, she said:

“I have joined B&CE at a very exciting time and I look forward to continuing to develop the brand to accommodate their growing business. B&CE values and guiding principles of ensuring all they do is in the best interest of their members; customers and their own employees really resonate with me and I am delighted to be a part of such a forward thinking and customer focused organisation.”

Commenting on Stella’s appointment, Roy Porter, Group Director of Sales and Marketing said:

“We’re delighted to welcome Stella into the team permanently. She’s already made an incredibly positive impact on the company in her time here as Interim Director of Marketing, so we’re thrilled that she will continue to lead on our marketing activities, particularly shaping and developing our brand and building straightforward and easy to understand communications that meet our audiences’ needs.”

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Notes to Editors

B&CE is a not-for-profit organisation, founded in the construction industry in 1942, offering workplace pensions, employee accident cover and employee life cover. It provides The People’s Pension, a leading master trust (multi-employer pension scheme) in the UK, with over 4 million members and more than 80,000 employers signed up (correct as of 17 December 2018) . Follow @peoplespension

The People’s Pension invests in ESG fund

The People’s Pension newly invests in fund combining ESG and factors to reduce fossil fuel exposure

The People’s Pension¹, a leading not-for-profit master trust in the UK, has this week invested in the State Street² ACS Multi-Factor Global ESG Equity Index Fund, in order to reduce exposure to ESG factors including fossil fuels, as part of its wider work on responsible investment.

The fund, which targets the MSCI³ World Select 5-Factor ESG Low Carbon Target, has a blend of smart beta factors and ESG characteristics. It targets five well-established equity factors, improved ESG scores and a reduction in carbon emissions and reserves intensity.

Commenting, Nico Aspinall, Chief Investment Officer at B&CE, provider of The People’s Pension, said:

“Factors offer a different way of constructing portfolios for members and we expect it will reduce the risk of our holdings overall whilst achieving their targets. We also recognise the importance of ESG as a financial factor and the screen we apply keeps the worst companies out of the portfolio, reducing fossil fuel exposures as a result.”

Guido Giese, Executive Director of MSCI, added:

“Institutional investors are increasingly seeking to incorporate ESG considerations into factors. This Index aims to incorporate ESG-based and carbon-based constraints in a bottom-up index construction approach.”

Daniel Leuty, UK Head of DC Clients and Financial Institutions at State Street, said:

“The launch of the State Street ACS Multi-Factor Global ESG Equity Index Fund continues to build on our belief and commitment to ESG and factor investing and delivering these capabilities to our clients and the wider market. State Street and The People’s Pension are fully aligned in the belief that climate change presents material, uncompensated risks to long-term investors, and this strategy was designed to protect and benefit the portfolio over the long-term.”

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Notes to editors:

The People’s Pension is a leading not-for-profit master trust in the UK, provided by B&CE, with more than 4m members from more than 80,000 employers, and £5bn assets under management (AUM) (as of 12 December 2018).
For four decades, State Street Global Advisors (SSGA) has served the world’s governments, institutions and financial advisors. With a rigorous, risk-aware approach built on research, analysis and market-tested experience, it builds from a breadth of active and index strategies to create cost-effective solutions. As stewards, SSGA help portfolio companies see that what is fair for people and sustainable for the planet can deliver long-term performance. As a result, SSGA has become the world’s third largest asset manager with nearly US $2.81 trillion under its care.
For more than 40 years, MSCI’s research-based indexes and analytics have helped the world’s leading investors build and manage better portfolios. Clients rely on their offerings for deeper insights into the drivers of performance and risk in their portfolios, broad asset class coverage and innovative research. Their line of products and services includes indexes, analytical models, data, real estate benchmarks and ESG research. MSCI serves 99 of the top 100 largest money managers, according to the most recent P&I ranking. For more information, visit www.msci.com.

B&CE appoints Tim Gosling as new head of policy

Joining B&CE from the Pensions and Lifetime Savings Association (PLSA) where he has been DC policy lead since 2015, Tim will work to develop B&CE’s pension policy. This will include the advantages of the not for profit with scale model in delivering value for money in DC pensions, extending the advantages of this model to and through retirement, and finding a solution to the growing small pots challenge, via consolidation.

Gregg McClymont, director of policy & external affairs at B&CE said:

“I’m delighted to welcome a technical policy expert of Tim’s calibre to B&CE. With his professional background in the not for profit trust-based pensions sector and at our trade body, he’s a great fit for The People’s Pension¹.”

Tim’s appointment begins on Monday 15 October 2018.

Commenting on his appointment, Tim Gosling² said:

“I’m excited to be joining The People’s Pension – a leading pension scheme that genuinely puts the saver at the heart of everything it does. This is an exciting time for pensions policy and I’m looking forward to joining such a strong team.”

The appointment comes following the departure of former Head of Policy and Government Relations, Andy Tarrant, who will continue to work on special projects for B&CE.

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Notes to Editors

The People’s Pension is a leading and not-for-profit master trust (multi-employer pension scheme) in the UK, with more than 4 million members from more than 80,000 employers, and £5bn Assets Under Management (as of 11 October 2018). We tweet as @peoplespension.
A picture of Tim Gosling can be downloaded on our Biographies & photos webpage.

B&CE appoints new director of IT

B&CE, provider of The People’s Pension, has appointed David Redbond as its new Director of IT

David comes to B&CE with a wealth of experience having worked in a number of top senior IT positions within the financial services industry. His previous roles include Chief Information Officer at Old Mutual, and roles at Skandia Life and Hargreaves Lansdown.

David will lead the development and implementation of overall IT strategy at B&CE ensuring that the organisation is well positioned for future growth across both its pensions and occupational health products.

Commenting on his appointment, David said:

“I am excited to join B&CE, a business that has grown rapidly over the last five years and recently hit 4million members. I look forward to working with the team to ensure it continues delivering systems that enable an excellent customer journey.”

Commenting on David’s appointment, Tracy Weller, Group Director of Business Operations said:

“We’re delighted to welcome David into the business. He has extensive IT experience in financial services and is well positioned to develop and maintain the IT strategy in support of B&CE’s strategic business goals. He will make a great addition to our senior leadership team.”

David joins Monday 13 August.

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Notes to Editors

B&CE is a not-for-profit organisation, founded in the construction industry in 1942, offering a workplace pension, employee accident cover and employee life cover. It provides The People’s Pension, a leading master trust (multi-employer pension scheme) in the UK, with more than 4 million members and more than 80,000 employers signed up (correct as of 13 August 2018). We tweet as @peoplespension.

The People’s Pension names Chris Fagan as a trustee

The People’s Pension announces the appointment of Chris Fagan as a Trustee

The People’s Pension, the UK’s second largest master trust with almost 4 million members (correct as of 5 July 2018), today announces the appointment of investment specialist Chris Fagan to its Trustee. In addition to building a portfolio of non-executive and trusteeship roles, Chris is an Associate Director with independent consultancy, Muse Advisory. Prior to this appointment he was a Trustee of the Towers Watson Pension Scheme and worked in Willis Towers Watson’s Investment Advisory and Fiduciary Management teams.

Commenting on the appointment of Chris Fagan as Trustee, Steve Delo, Chair of Trustees said:

“We are pleased to welcome Chris onto the Trustee board and are confident that his exceptional levels of pensions expertise and front-line investment knowledge will add greatly to scheme governance. By bringing in industry renowned pensions professionals such as Chris, we are able to maintain high standards of trusteeship and ensure we continue to deliver excellent outcomes for our members.”

With almost 30 years of experience at UK pension schemes, Chris’ expertise will help strengthen the technical pensions offering at The People’s Pension. His appointment will begin in early July 2018.

Commenting on his appointment as Trustee at The People’s Pension, Chris Fagan said:

“I’m really excited to be joining The People’s Pension as a Trustee and await the challenges this new role will bring. I’m looking forward to the variety offered by a role at a Master Trust and helping bring pension provisions to those who may not otherwise have access to retirement saving tools.”

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Notes to Editors

The People’s Pension is the second largest master trust (multi-employer pension scheme) in the UK, with almost 4 million members, £4bn assets under management and more than 80,000 employers signed up (correct as of 5 July 2018). Follow @peoplespension.

Former Shadow Pensions Minister joins The People’s Pension

B&CE, provider of The People’s Pension, announces that former Shadow Pensions Minister, Gregg McClymont is to join the organisation as Director of Policy and External Affairs

Gregg joins B&CE from Aberdeen Standard Investments where he has been Head of Retirement for three years. Previously he was an MP, an Opposition Whip and then Shadow Minister of State for Pensions from 2011 – 2015. He was also an adviser to the Secretary of State for Health, between 2003 and 2005. His first career was as an Oxford academic.

Gregg is co-editor of two books on the design of pensions systems around the world. He plays an active role on several industry boards and committees including the FCA’s Institutional Disclosure Working Group (IDWG) and the Board of Directors of the Tax Incentivised Savings Association (TISA). Gregg is a visiting Fellow at Nuffield College, Oxford.

At B&CE, Gregg will lead the organisation’s Policy and External Affairs team, overseeing relationships with external stakeholders including policymakers, media and trade associations on money and health matters. He will join B&CE at the end of July.

Commenting on the appointment, Patrick Heath-Lay, Chief Executive Officer of B&CE said:

“Gregg’s commitment to delivering better retirement savings outcomes for working people is well-recognised throughout the industry and in Parliament. He has been a tireless supporter of automatic enrolment and a vocal campaigner for improved pensions options for UK workers. As a not-for-profit organisation, this aligns with B&CE’s aims and values and we are thrilled to be able to benefit from his extensive policy experience and industry expertise.”

Gregg McClymont said:

“This is an exciting time to be joining B&CE. With nearly 4 million members* The People’s Pension is growing rapidly and helping to shape how the retirement savings industry can better address the needs of workers up and down the country. Large not-for-profit pension funds are the most efficient way to deliver occupational pensions at scale. I am also looking forward to supporting the organisation as it develops an occupational health solution that will improve the lives of workers by treating health equally to safety, catching symptoms of ill health in the workplace early and helping them to stay in work longer.”

*Correct as of 2 July 2018.

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B&CE strengthens Board of Directors with new hire

B&CE, provider of The People’s Pension, has appointed Pat Billingham as a Non-Executive Director

Pat has extensive board experience and currently holds non-executive directorships at Exemplas, RenaissanceRe Syndicate Management, Huntsworth Group where she is Chair of Audit, and Aldwyck Housing Group, where she is Chair of the Group Board.

Commenting on the appointment of Pat Billingham, Babloo Ramamurthy, Chairman of B&CE, said:

“We are delighted to announce the appointment of Pat at B&CE. She has an exceptional wealth of experience to bring to our Board, having held positions at a wide range of companies in multiple sectors, particularly across both health and money.

“As we move forward, not only growing our financial business but also building our new occupational health product, her experience will be invaluable to B&CE.”

Pat will join B&CE’s Board in early July 2018 and will chair B&CE’s Group Audit and Risk Committee from January 2019.

Commenting on her new appointment, Pat said:

“I’m excited to be joining the Board of B&CE and I’m fully committed to the company’s aims of creating simple financial products to meet the needs of working people. It’s essential that customers understand what they’re buying and why they’re buying it, especially when asked to pay for something that they won’t receive for many years to come. B&CE’s aim of making the complex understandable is much needed within the sector and I will be pleased to play my part in achieving this goal.”

ENDS

Notes to Editors

B&CE is a not-for-profit organisation, founded in the construction industry in 1942, offering a workplace pension, employee accident cover and employee life cover. It provides The People’s Pension, the second largest master trust (multi-employer pension scheme) in the UK, with almost 4 million members and more than 80,000 employers signed up (correct as of 29 June 2018). Follow @peoplespension.

New Trustee appointment announced at The People’s Pension

The People’s Pension has appointed David Maddison to its Board of Trustees

Well-known across the pensions industry, he brings a wealth of experience from nearly thirty years at RPMI, most recently as scheme managing director, where he leads a function dedicated to supporting the Railways Pension Scheme trustee board. He is a Fellow of the Pensions Management Institute, an Associate of the Chartered Insurance Institute and a Chartered Director from the Institute of Directors.

David is also a Non-Executive Director of Health Shield Friendly Society Ltd serving as chairman of the Business Development and Investment Committee and a member of the Nomination and Remuneration and Pensions Governance Committees.

Commenting on his appointment, he said:

“I am really pleased to be joining The People’s Pension, which has had outstanding success to date with an impressive trustee board and executive team. I’m looking forward to bringing my experience and challenge to the table and to play a part in The People’s Pension’s continued development.”

David will start his role from June 1 2018.

Commenting on the appointment, Steve Delo, Chair of The People’s Pension Trustee, said:

“David is a respected figure across the pensions industry, and we are delighted that he will be joining the Trustee. His energy, expertise and experience will help ensure that we continue to provide excellent value for money for our members, putting them at the heart of everything we do.”

After reaching the end of his two-year term, Ruston Smith is stepping down from the Trustee from May 31 2018.

Commenting on the departure, Steve Delo added:

“Ruston has been a great asset to the Trustee during the past two years, and it’s been fantastic working alongside him. We wish him all the best.”

Sue Lewis, who joined the board in April 2016, has also been reappointed for a further term of two years.

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Notes to Editors

The People’s Pension is the largest private sector master trust (multi-employer pension scheme) in the UK, with almost 4 million members and £4bn assets under management (correct as of 25 May 2018). Follow us @peoplespension.