IAPF’s Cost Transparency Standard

16 July 2024:  The Pensions Authority welcomes the launch of the IAPF’s Cost Transparency Standard (CTS). Participation in the CTS will enable trustees to better understand the investment costs they pay and to benchmark these costs against their peers. The CTS builds on the requirement in the Pensions Benefit Statement to provide a breakdown of the costs deducted by the scheme.

Pension scheme trustees have responsibility for achieving good outcomes for the members and beneficiaries of their scheme. Scheme costs have an important bearing on these outcomes, and therefore trustees should know the costs that their pension scheme is incurring and be able to justify the value received for these costs.

Costs and value for money are an important part of the Authority’s engagement with pension scheme trustees. The information provided by CTS will be a useful input into that dialogue. The Authority will expect those schemes which are not participating in the CTS process to have equivalent data, from whatever source.

The Authority favours a voluntary approach to cost transparency, benchmarking and disclosure. Through its supervisory activities, the Authority will closely monitor the success of the voluntary regime. However, in the longer term if cost disclosure and comparability are not adequate, the Authority will seek legislative change.

Further information is available at IAPF CTS.