PASA has submitted its response to the DWP consultation ‘Trust-based pension schemes: Trustees and governance, building a stronger future.’
PASA welcomes the consultation and its focus on strengthening trusteeship, governance and administration to improve saver outcomes across DB, DC, CDC, Master Trust and emerging Megafund structures. The consultation recognises the strategic and operational importance of high quality administration within a well governed trust-based system.
In its response, PASA calls for mandatory, proportionate minimum administration standards grounded in existing, industry-tested frameworks. Building on established Standards, Guidance and Accreditation will accelerate implementation, avoid duplication and provide trustees and regulators with clear, independent evidence of operational capability.
PASA highlights four priority areas:
Mandatory minimum administration standards
PASA supports the introduction of consistent baseline standards across in-house, third party and insurer models. Standards should drive decision-useful management information focused on trends, root causes and forward-looking risk indicators rather than simple SLA metrics. They should also recognise the critical role of people, skills and embedded scheme knowledge in delivering accurate and timely benefits.
Administrator registration and accreditation
PASA supports administrator registration with TPR to improve visibility of operational capability and systemic concentration risk. Meeting defined minimum standards should be a condition of registration, with independent accreditation providing one route to evidence compliance. Any deregistration powers must be paired with robust continuity protections and realistic transition planning to safeguard members.
Managing consolidation and systemic risk
As consolidation accelerates, PASA stresses DC Megafunds introduce a materially different order of operational and systemic risk. A tiered regulatory approach with enhanced expectations for resilience, cyber security, continuity planning and member voice is appropriate. Without clear standards, phased exit planning and credible resilience requirements, market concentration could increase single point of failure risk across a small number of administrators and software platforms.
Reducing the risk of disorderly market exits
PASA also calls for a more proactive supervisory approach to reduce the likelihood and impact of a disorderly exit by an administration provider. Registration and minimum standards would give TPR earlier visibility of emerging provider stress and concentration risk. Clear expectations for continuity planning, including data escrow, structured transition protocols and scenario testing for credible failure modes, will be essential. Complex administration cannot be transferred overnight. Stronger forward planning will protect members and support orderly transitions where change becomes necessary.
The response also supports statutory higher standards for professional trustees, particularly in administration, data and operational risk oversight, and calls for clearer alignment across regulatory perimeters to reduce fragmentation and improve accountability.
David Fairs, PASA Chair, said: “This consultation represents an important opportunity to strengthen governance in a way which recognises the central role of high quality administration in delivering saver outcomes.
Administration risk is operational risk. It involves data, systems, controls, people and continuity. Introducing proportionate minimum standards, linked to registration and evidenced through independent accreditation, will give trustees and regulators clearer visibility of capability and emerging systemic risk, including the risk of disorderly provider failure.
PASA has already developed and tested a comprehensive Standards, Guidance and Accreditation framework across the industry. Building on this established foundation through TPR encouraging wider adoption, will accelerate progress, support innovation and avoid unnecessary duplication.
As consolidation gathers pace and DC Megafunds emerge, scale alone will not guarantee better member experience. Stronger oversight, tiered expectations, credible continuity planning and structured exit frameworks will be essential to protect members and maintain confidence in the trust-based system.
PASA stands ready to support the DWP in developing detailed technical standards and practical implementation guidance, drawing on its established framework and broad industry expertise.
PASA will continue to work closely with DWP, TPR and industry stakeholders to support practical implementation and ensure administration remains firmly at the heart of good governance.”
You can find PASA’s response here
