Skip to main content

Your browser is out of date, and unable to use many of the features of this website

Please upgrade your browser.


This website requires cookies. Your browser currently has cookies disabled.

Value for members


Early draft of the code of practice

This code is not in force yet. It is an early version for the new code of practice consultation.

To give us feedback on issues such as the design, usability and navigation of this code, email us at

You can also read more information about the consultation.

Published: 17 March 2021

Unless exemptVA1, governing bodies of trust-based occupational pension schemes providing defined contribution (DC) benefits must, at least annually:

  • calculate the charges and, as far as they can, the transaction costs borne by members’ funds
  • assess the extent to which the charges and costs represent good value for membersVA2
  • explain their assessment of value for members (VFM) in the annual chair’s statement.VA3 Learn more in the Chair’s statement.

The list below describes how governing bodies should assess, determine and manage VFM.

Assessing VFM

  • Engage early with relevant parties, such as fund managers, administrators and scheme advisors, and establish the lead in time required to provide information about charges and costs.
  • Record any problems encountered in obtaining the necessary information and the steps taken to resolve them.
  • Document the evidence used to arrive at conclusions.

Determining VFM

  • Make efforts to understand the characteristics of their members in a manner proportionate to the scale, size, and resources of their scheme.
  • Consider characteristics such as scheme member demographics and, where possible, their salary profile.
  • Where possible, consider members’ preferences and financial needs.
  • Consider all available evidence when exercising judgment about what represents VFM.
  • Where direct member feedback is limited, consider what alternative methods can be used to assess VFM.
  • Consider using publicly available industry research reports to compare their scheme to similar ones.
  • Where the costs of a service are shared between members and employers – for example through a rebate arrangement or a proportional contribution from the employer, as opposed to a distinct division of cost – take into account all elements of services provided when carrying out their assessment.
  • Clearly set out the basis of cost sharing in their explanation of the VFM assessment in the chair’s statement.

Where governing bodies have identified areas of poor VFM they may wish to consider the following actions:

Managing poor VFM

  • Document the issues identified, as well as the steps needed to improve VFM in those areas.
  • Where it is not possible to improve VFM, document the reasons for this.
  • Where they are unable to resolve matters leading to poor VFM, consider whether winding the scheme up is an appropriate action.
  • Record the outcome of this consideration and regularly review it whilst poor value persists.

Legal references

VA1Regulation 25(1) Occupational Pension Schemes (Scheme Administration) Regulations 1996
[Regulation 25(1) Occupational Pension Schemes (Scheme Administration) Regulations (Northern Ireland) 1997]
See the definition of ‘relevant scheme’ for the exemptions.

VA2Regulation 25(1) Occupational Pension Schemes (Scheme Administration) Regulations 1996
[Regulation 25(1) Occupational Pension Schemes (Scheme Administration) Regulations (Northern Ireland) 1997]

VA3Regulation 23(1)(c) Occupational Pension Schemes (Scheme Administration) Regulations 1996
[Regulation 25(1)(c) Occupational Pension Schemes (Scheme Administration) Regulations (Northern Ireland) 1997]