Trustees ‘among lowest paid’ in pension management despite growing responsibilities

Trustees are among the lowest paid roles in pension scheme management despite increasing regulation and responsibilities, figures from PwC have shown.

PwC found that schemes typically pay less for trustees than for actuarial and legal advisers, and in some instances less than for secretarial support.

Its Trustee Pay Survey revealed the average annual pay for a trustee board chair was £54,000, or around 5 per cent of the annual cost of managing a typical defined benefit scheme excluding investment costs, and less than quarter of the average pay for a major company board chair.

The average pay for a trustee that was not chair was £30,000 a year.

PwC stated that the global pandemic and market volatility, alongside increasing regulation, had put more pressure on pension trustees “than ever before”.

Furthermore, according to PwC, trustee time commitment had “steadily increased” over the last 10 years, from an average of 17 days a year in 2010 to 26 days in 2020.

“Huge additional pressure has been placed on trustees over the past year to preserve the continuity of service to members,” commented PwC head of pensions management consulting, Peter Sparshott.

“With a number of new requirements underway or in the pipeline, such as benefit equalisation and pensions dashboards, we are expecting trustees to be busier than ever.

“At the end of such a difficult year and with no easement in sight, it is perhaps a good time to reflect on whether trustees are adequately rewarded for taking on this ever-growing list of responsibilities and challenges.”

PwC also found that women tended to be under-represented on trustee boards, with 24 per cent of trustees women and 17 per cent of trustee chairs being female.

However, average pay for female chairs tended to be higher than their male counterparts.

PwC pensions partner, Saye Mkangama, added: “It’s clear that many trustee boards are not currently representative of the diverse membership they are serving.

“Representation is important because it has been reported that the gender pensions gap in the UK could be 40 per cent and the ethnicity pensions gap could be 25 per cent.

“Improved representation on trustee boards, and pensions industry leadership in general, will allow the development of better pension policies, products and options. They can be more tailored to diverse individual needs. Other channels can be created for savers to access the pensions information that they need.”

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