Will a mastertrust be suitable for all employees? Pensions Insight explores


While the likes of NEST and The People’s Pension might do a great job of providing a low-cost, well-run pension for low earning or short stay staff, many employers will ultimately realise that no single pension arrangement will work for all of the people in their organisation.

Combining arrangements together so that, for example, a low-cost mastertrust is used for short-term workers or those below a certain level of salary, with a GPP for senior or long-stay staff is one option. While in theory any combination of providers could work in this context, B&CE has put in place an arrangement between GPP provider Scottish Widows and B&CE’s The Peoples Pension product to provide a ready-made approach to splitting pension provision according to employee grade.

Another route might be to use a low-cost master trust provider, with a top-up pension arrangement offered for contributions above a certain threshold. NEST itself has taken this approach, appointing Aviva to provide a top-up GPP for pension contributions above its government-imposed £4,200 contributions cap.