The voices of trustees, who control the majority of workplace pension money in the UK, are 'rarely heard' in the corridors of power, a report from LCP has warned

The report highlighted the "huge concentration" of defined benefit (DB) pension scheme assets, revealing that 50 schemes account for half of all DB assets.

Decisions on how that money was invested were taken by fewer than 500 trustees across those schemes, including over 150 'lay' members of their pension scheme, nominated by other members to serve as trustees.

However, the report suggested that the voices of these 'pensions powerbrokers' were rarely heard in the corridors of power.

Despite their influence in determining how pension scheme assets are invested and setting the scheme's 'endgame' from the range of available alternatives, trustees—both lay and professional—told LCP their voices were often not heard.

They said ministers regularly met with representatives of the pensions industry, asset managers, and insurance companies but rarely had face-to-face meetings with the trustees who decide how money is invested.

However, the report warned that unless this changes, plans to ensure UK pension assets are used more productively to promote economic growth were likely to fail.

LCP partner, Nathalie Sims, said this omission must be addressed "as a matter of urgency" if we are to get the most out of the money invested in the UK pension system.

"Following the pensions regulator's recent announcements about its extension of oversight to the 11 largest professional trustee firms, trusteeship is back in the spotlight," she suggested.

"Pension scheme trusteeship is an increasingly professional area, with trustee firms and independent trustees providing high-level expertise and high-quality governance to schemes."

Echoing this, LCP partner, Lorraine Porter, stressed that trustees were "at the heart" of the pension system.

"This includes the vital contribution of hundreds of lay trustees, nominated by scheme members, who bring unique insights and diversity of thought to trustee deliberations," she said.

"At a time of huge change in the world of DB pensions, with key decisions being made about the future of schemes, it is time that the trustee's voice was put front and centre of policymaking and regulation."

LCP partner, Steve Webb, added: "The government is keen to see pension scheme assets across the pensions landscape invested in a way that will generate higher levels of growth in the UK economy. But any reform will be ineffective if it is not grounded in a full understanding of the role and attitudes of pension scheme trustees.

"Most trustees are open to a conversation about making the most of the money held in their pension scheme, but policymakers need to understand the constraints within which trustees operate and do more to address their concerns."

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