The recent comments from the Bank of England on superfunds highlights key considerations for trustees and scheme members.
When considering the caution raised by the Bank of England, it appears that it is important to consider the underlying principles including member protection and consideration of the alternatives available to a scheme.
Where the interests of members are promoted having regard to the other options, then superfunds may potentially provide a new opportunity to consider for schemes.
With this in mind it is useful to consider the framework suggested by tPR including:
- a recommendation for clearance to be obtained
- a clear record of the merits and rationale in respect of the proposal
- those involved to meet fitness and proprietyrequirements
- high levels of governance
- clear communications with members
- triggers in the deed and rules in respect of funding and winding up.
Properly applied the above structure may potentially provide greater governance and assurance levels than some alternatives that also include levels of inherent risk.
In short we support the ongoing discussions in respect of superfunds and welcome the Regulator’s guidance providing this initial framework. Caution is natural, whilst evaluating any option will naturally have promoting member interests as key
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