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Yes, that is the point I was trying to make. Even master trusts that have been set up entirely properly and with the best of intentions could find, by the end of auto-enrolment, that they were not going to be viable in the long run. We need to ensure that there is a clear, well managed route so that, rather than having zombie funds sitting around delivering a poor return, we can get them moved into the higher quality, better performing ones. We need to ensure that this market works for everyone.
One element that people might not have considered is that we have not yet found a solution for people who end up with multiple very small pots spread across the landscape. I suspect that that could present a cost to the system that we will want to manage our way out of in order to create a sustainable situation. Overall, master trusts are a good thing, but they will need to be well regulated if they are to create confidence in the system and ensure that savers do not get a bad deal.
There are a few other things that I think I can just about sneak in as being within the scope of the Bill. We have ended up with slightly different arrangements for master trusts and insurance-based products, and I wonder whether it is sensible to have so many different regulators in the industry trying to do the same thing. Should the Pensions Regulator really be responsible for regulating all pension schemes, however they are structured, rather than letting the Financial Conduct Authority do some? Should we try to get equivalence between schemes that are trying to do the same thing but end up having subtle differences? Perhaps it would be better to say to all savers and all members of pension schemes, “Your scheme is regulated by the Pensions Regulator. Yes, there will be a cut-off with the FCA at some point.” That would be better than having uncertainty about who is responsible for which scheme.
Looking at master trusts more generally, there is a need to think through the position in the decumulation phase. The market might already be seeing that master trusts can be used for decumulation as well as accumulation. Decumulation is a very different model, and it is perhaps harder to see the business case for that than for the accumulation phase, with its ever-growing pots and more income. With decumulation, we have ever-dwindling pots and seemingly less income from the fees. We need to think through whether master trusts are intentionally aimed at the decumulation phase where members treat them as a kind of bank account from which they can draw money when they want to. The secret will be to ensure that savers have access to the right advice, and it is a pity that the Bill does not address the future of the various advice schemes, but I am sure that we will get to that at some point. In summary, this is a welcome and necessary Bill, and I am sure that it will be very effective. I look forward to its making progress in the House.