Value for money in workplace pensions
The current consultation paper CP26/25 is focusing on Value for Money in workplace pensions. We are developing our consumer research and insights programme to support the industry in better understanding what consumers value from their workplace pensions. Please talk to us for more information.
Value for Money: is the service pillar ambitious enough?
Performance and price are data, but service is harder to define, and the proposed service metrics currently focus on provider-held administrative data rather than what savers themselves say they value.
In July we asked over 1,400 Boring Money readers what they value about a workplace pension. Information, tools and support to take action came back as core components of any value equation, all of which can be tracked and benchmarked against peers.
What the framework will ask you to prove
Annually, providers and trustees will collect metric data, submit it for assessment and rating, compare it against other schemes and relevant benchmarks, and publish the outcome for each arrangement. Assessment is likely to be weighted towards investment performance and costs, though the final weighting is still to be determined.
Years of experience tracking consumer research, market data and providing the "voice of the customer" to the industry means Boring Money is uniquely positioned to help you meet and evidence these requirements at every stage.
Workplace pensions can capture customer feedback to gauge performance in both an absolute and relative sense against key service metrics.
Service is an important factor of value for consumers
Using a satisfaction survey alone is unlikely to be the appropriate measure for VFM
We believe that the quality-of-service metrics need to be expanded to assess performance against additional service metrics such as:
Why this matters now
Auto-enrolment has been very successful at getting people into pensions, and much less effective at proving those pensions deliver good outcomes. Most workplace savers do not actively engage, rarely switch and seldom challenge value, so poor-quality arrangements can persist unchallenged.
The Value for Money framework is intended to change what providers compete on. Arrangements will be publicly rated, employers will have the information to select on long-term value, and persistent underperformers may be required to transfer members elsewhere.
The journey to first assessment
We are currently within a second phase of consultation. Data submission is required well before the first assessment reports are published, so the work to close data and evidence gaps needs to start against the 2027 dates, not the 2028 ones.
How we are helping clients with Value for Money
Our extensive support of firms through Assessment of Value, Consumer Duty, and Targeted Support has enabled us to develop robust research, implementation and validation frameworks that support good regulatory outcomes and customer-centric servicing.
Our Value for Money Partnership Framework helps providers, master trusts and trustee boards navigate the full journey.
At the heart of the conversation
We were joined by Nike Trost, Head of Department for Asset Management and Pensions Policy at the Financial Conduct Authority (FCA), at our fourth annual conference, Boring Money 2025: Change and Growth.
Our mission is to provide independent consumer-first input to regulators and policy makers, and also to engage with the industry to improve consumer insights and understanding, to enable and support better customer outcomes across the board.
