Workers should have more say in how their pensions are governed through mandated member representation on pension trustee boards, the Trades Union Congress (TUC) has argued.

Its report warned that worker representation on pension boards was falling amid a shift from employer-based pension schemes to multi-employer schemes.

With the government looking to scale up schemes and improve governance standards, TUC emphasised that member-nominated trustees (MNT) strengthened accountability, decision quality, engagement, and diversity on scheme boards.

It noted that while mandatory MNTs were introduced following the Robert Maxwell scandal, changes to the system meant that most workers were in multi-employer schemes that were exempt from these requirements.

Furthermore, TUC raised concerns that consolidation would accelerate this trend.

To address these concerns, TUC outlined three recommendations, including the introduction of minimum requirements for member representation at scale by requiring all trustee boards of trust-based schemes to include at least one-third member representation, regardless of scheme structure or size.

It also called for governance structures that recognised the diversity of members in multi-employer schemes to be encouraged, rooted in clearly defined cohorts of workers based on characteristics.

Finally, it recommended that minimum standards for support, training, and resourcing should be set to ensure representation is effective, rather than symbolic.

“Pension schemes deliver better outcomes for members - and ultimately a better quality of life in retirement - when those members have a say in how they are run,” commented TUC general secretary, Paul Nowak.

“As the government looks to move to a system of fewer, bigger pension schemes, ministers should look to Australia and Canada to see how member representation can help to ensure those bigger schemes deliver better results.

“All workers deserve to retire in dignity. It is vital that pensions are governed fairly.”

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