There is a “growing gulf” between master trust service standards, LCP has argued, with its analysis showing a 25 per cent difference in the range between the best and worst providers.

The firm said this could raise the question of how robust providers would be in coping with any shocks and sudden increases in demand.

LCP suggested that the quality of service delivery and the extent to which providers are responsive to member engagement varies across the market, emphasising that this would become an increasing focus when the government’s Value for Money framework comes into effect.

The firm also pointed out that the master trust market remains highly competitive, with a clear strategy and a track record of proposition development contributing to success.
It said that providers are working across a whole range of areas to ensure that their propositions remain competitive.

In particular, there is activity in front-end member-facing services such as improving service standards, member engagement, financial wellbeing, and post-retirement.

In addition to this, the report said that the potential reforms announced as part of the Chancellor’s Mansion House speech, if they go ahead, could result in further consolidation of the master trust market.

The firm said that therefore understanding the provider’s business plans and selecting a provider that is well-placed to remain in the market is an increasingly important consideration.

The report also acknowledged that engagement in defined contribution (DC) schemes remained a challenge but said some providers have been successful in engaging members with key tasks or via certain channels.

LCP suggested that understanding best practices in this area will help providers assess the best solution for its members.

In addition to this, the report also suggested that decumulation options are evolving into broader service-based solutions rather than investment propositions.

LCP said that this was the most notable area of development over the past year and one in which a range of providers are set to bring solutions to market over the next 12 months.

Looking forward to 2025, LCP expects continued enhancements, especially in the post-retirement space, which it said is starting to get the focus it needs to ensure members are adequately supported at this “vital” time.

LCP principal, Rachel Crowther, stated: “The master trust market is varied but competitive. There are significant differences between providers so it’s really important to dive into the detail of how they work to ascertain which one will meet your needs and those of your members.”

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