The Bank of New York Mellon Corporation : Administration, Risk Control and Competitive Fees Driving DC Pension Scheme Platform Selection, According to New BNY Mellon-Cerulli Associates Report

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Contact: Tim Steele

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Administration, risk control and competitive fees driving DC pension scheme platform selection, according to new BNY Mellon-Cerulli Associates report

LONDON, January 17, 2013 - A new report published by BNY Mellon, the global leader in investment management and investment services, in association with Cerulli Associates, has identified administration, risk control and competitive fees as the three key critical considerations for DC pension schemes selecting a platform provider in the UK.
The new report - The Future of UK DC Pension Platforms - notes that the workplace savings market in the UK is currently going through the most radical period of change in a generation. Developments and innovations in full service 'bundled' platforms - the infrastructure allowing pension schemes to receive administration, investment and communication services combined - will play a defining role in the future delivery of workplace savings provision.
Pensions and benefits managers must ensure their chosen platform providers can offer the appropriate range of at-retirement solutions or linkages to other providers as appropriate. At the same time, platform providers themselves need to align their products to better meet the changing needs of pension schemes.
David Calfo, Group Head of DC Strategy at BNY Mellon, said: "The industry has reached a watershed. Developments initiated in the next 12-18 months will have a lasting effect on shaping its future. Several legislative initiatives, from auto-enrolment to the Retail Distribution Review (RDR), have created further impetus for all those involved to review their existing models."
The introduction of auto-enrolment will over time likely precipitate a large influx of additional pension contributions due to anticipated higher levels of take-up and is also prompting employers to review their existing pension scheme provision for their workforces. At the same time, there is also likely to be an increased shift from unbundled to bundled offerings to allow pension schemes to harness cost savings and improve administrative efficiency.
The report highlights a number of key findings: