PMI responds to Value for Money consultation 

The Pensions Management Institute (PMI) has published its response to the Government's consultation on the proposed Value for Money (VfM) Framework, welcoming the significant progress made in moving beyond simple cost comparisons and towards a broader assessment of the value workplace pension schemes deliver to members.  

The PMI supports the framework's focus on investment performance, costs and service quality, and welcomes the move towards more proportionate and practical measures. The Institute also backs the phased implementation approach and the recognition that value should not be judged on cost alone.  

However, the PMI has urged Government and regulators to ensure the framework is only applied where it can deliver fair, meaningful and comparable assessments. In particular, the Institute believes hybrid pension schemes should remain exempt from the initial scope of the framework, or be granted a temporary exemption until a more tailored approach can be developed.  

The PMI is concerned that applying a framework designed primarily for standalone defined contribution arrangements to hybrid schemes could create misleading comparisons, increase costs and administrative burdens, and potentially divert time and resources away from activities that directly improve outcomes for members.  

It has also called for greater recognition of employer subsidies within assessments, a review of whether annual full assessments are necessary in all circumstances, and a future expansion of the framework to consider retirement income and decumulation outcomes, rather than focusing solely on pension saving during the accumulation phase.