Umbrella funds need tougher scrutiny
Pension pots should open up to costs and conflicts of interest
The steady growth of members in umbrella funds is likely to accelerate with a government-led drive to consolidate retirement funds, making the need for improved oversight of these funds all the more pressing. A seasoned pension lawyer speaking at the annual conference of the Pension Lawyers Association this week highlighted the inadequacy of the Pension Funds Act to deal with the multiplicity of legal issues arising from the increasing use of umbrella retirement funds. However, umbrella retirement fund providers argue that the industry has become more competitive and this, together with a growing awareness among employers of their duty to interrogate whether funds are suitable for their employees, has led to funds improving their offerings. Umbrella funds, which offer a number of employer groups the opportunity to save in a single retirement fund, have been growing rapidly but there are no specific provisions in the Pension Funds Act dealing with these structures. In last week's Bud...
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