Prudential has decided to wind up its master trusts, as it is focusing on the migration of its administration platform.
The current members of the master trusts will remain with the provider, and their funds will be held in the name of the individual in default investment strategies, a spokesperson told FTAdviser.
However, she declined to reveal the number of members affected by this change.
Employers who participated in master trust schemes have been given the option of using a new group personal pension with Prudential for ongoing contributions.
The Prudential spokesperson said: "The Prudential master trust schemes entered wind up in April 2019. More broadly, the Prudential corporate pensions business is preparing for migration to a new administration platform, BaNCS run by Diligenta.
"The focus of the business is very much on ensuring the orderly migration and at the same time providing scheme members with a good service be it administrative or investment."
In January 2018, Prudential announced an agreement for a 10-year partnership with Tata Consultancy Services, which would see the pension administration services for some 4m life and pensions contracts consolidated into one platform and digitalised in order to speed up service.
Prudential had worked with business process outsourcing company Capita for the past 10 years and agreed to move contracts to Diligenta, the Financial Conduct Authority-regulated subsidiary of TCS.
Master trust came under more intense scrutiny as a new registration process was introduced. From October 1, 2018, master trusts had until March 31, 2019 to apply to the The Pensions Regulator for authorisation to demonstrate that they have met the newly required standards.
Under the new registration process, master trusts have to hold enough capital to cover the cost of a worst-case scenario, such as the cost of transferring to another scheme or of winding up, without charging members.
The government and the regulator have been discussing these new rules since 2016 and were expecting them to drive consolidation in the market.
To date some 39 master trusts have applied for authorisation with TPR, as the application process for existing workplace pension schemes has ended.
maria.espadinha@ft.com
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