FCA defers review of workplace pension independent governance committees

The first IGCs began operating in April 2015, and were set up to fulfil broadly the same role for members of workplace personal pension schemes as trustees perform in occupational pension schemes.

The FCA had intended to assess how effective IGCs are in helping pension providers deliver value for money for workplace pension scheme members, including their effectiveness against the recommendations of the legacy audit conducted in response to then consumer protection regulator the Office of Fair Trading's critical report on the defined contribution (DC) pensions market.

It has, however, deferred this review "to allow us to focus on other priorities", as set out in its latest business plan. A 2016 review of industry progress against the recommendations of the Independent Project Board, conducted jointly by the FCA and the Department for Work and Pensions, was broadly supportive of the role played by IGCs in this process, according to an update on the FCA's website.

The regulator has not provided any indication of when it will return to this review.

IGCs have a duty to act in the interests of the pension scheme members, independently of employers and providers. They must have a minimum of five members and the majority of these, including the chair, must be independent.

Among their duties, IGCs must produce an annual report on the scheme's value for money and performance against a range of quality standards. They are also under an ongoing duty to assess the value for money of the scheme, raising any concerns with the provider's board and escalating their concerns to the FCA if necessary.