Trustees are among the lowest paid roles in pension scheme management despite growing responsibilities and increased regulation, analysis by PwC reveals.
A survey conducted by the firm found that on average, the chair of a trustee board is paid £54k a year. This is around 5% of the total annual cost of managing a typical DB pension scheme (excluding investment costs), and is less than 25% of the average pay of the chair of a major company board.
PwC also found that the average pay of a trustee who is not a board chair, but is likely to have additional responsibilities such as chairing a sub-committee, is £30k a year, the survey of 112 schemes shows.
According to the firm, the global pandemic and the “associated volatility in financial markets”, together with increased attention from the pensions regulator (TPR), has “put more pressure on pension scheme trustees than ever before”.
However, it discovered that “schemes typically pay less for trustees than for their actuarial and legal advisers, and in some cases less than their secretarial support”. This is despite having “responsibility for managing the challenges, risks and complexities associated with the £2trn of defined benefit pension liabilities in the UK”.
Saye Mkangama, PwC pensions partner, said: “Huge additional pressure has been placed on trustees over the past year to preserve the continuity of service to members. With a number of new requirements underway or in the pipeline, such as benefit equalisation and pensions dashboards, we are expecting trustees to be busier than ever.
“At the end of such a difficult year and with no easement in sight, it is perhaps a good time to reflect on whether trustees are adequately rewarded for taking on this ever-growing list of responsibilities and challenges.”