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Member Communication and Pension Superfunds

What is a pension superfund?

A superfund is a special purpose vehicle (SPV) that eliminates an employer’s liability towards a Defined Benefit (DB) scheme.

The scheme employer is replaced by the SPV “shell” employer, preserving the scheme’s pension protection fund (PPF) eligibility. Multiple schemes are pooled into an SPV to gain bulk efficiencies for better member outcomes.

Pension superfund consolidation.

The first defined benefit pension superfunds were launched in March of 2018 by Clara Pensions and The Pension SuperFund. These superfunds aim to bring together several corporate pension schemes, running them more efficiently and doing so at a lower cost than the initial company that set them up.

Superfunds operate in such a way that the companies (also known as sponsors) that have set up the initial pension schemes pass on all of the assets and liabilities in the scheme to a superfund. The superfunds will then continue to manage the pension schemes accordingly until they have paid out or until they can be passed onto an insurance company.

These superfunds are regulated by The Pension Regulator, under rules that were put into effect by the UK government in December 2018 and updated in June 2020 (Read more here.)

With one in five schemes considering superfunds and as many as 11% already discussing these as an option, don’t let member communication requirements be an afterthought.

Member communication requirements for superfunds

Communication throughout the entire membership is essential for members to help them decide how to proceed, once they retire. Much like regular pensions schemes, the same obligations fall on superfunds when it comes to member communications.

In the regulations updated in June 2020, The Pension Regulator stated that for DB Superfunds “We will expect trustees to clearly explain their approach to member communications, how they will be tested for accuracy and how they will satisfy themselves that they are effective. We will also ask trustees to set out how they have ensured members are able to provide feedback and by which mechanism.”

An example of a critical piece of member communication that will still need to be provided, should a scheme be transferred to a superfund, is the annual summary funding statement.

Summary funding statements are issued to scheme members following the completion of the actuarial valuation, or report, to explain the scheme’s latest financial position.

In this statement you will need to communication to members how the scheme’s assets compare with the value of the scheme’s liabilities – the amount needed to pay future pensions and other benefits given prevailing market conditions.

Additionally, there are other scenarios where all providers will need to communicate with members, such as;

  • Changes in pension scheme legislations
  • Changes in your scheme’s design

For consolidation and transferring assets and liability to a superfund, all parties involved will also need to communicate with current scheme members throughout the process.

This process can be simplified by working with an expert pension communication provider, who can use the data you hold on your members to streamline both consolidation and ongoing communication.

Integrating member feedback and response management

With feedback mechanisms required to be put to the regulator, scheme providers and superfunds should consider response management systems as part of their member communications plan, to ensure accuracy and efficiency.

A response management solution, implemented as part of your communications, will allow those managing responses and collating feedback a view of exactly what communication has been sent to a particular member and feedback to be recorded and analysed accordingly – with easy reporting to satisfy regulatory guidance.

We have helped clients put in place response management processes as part of ongoing communication projects using our proprietary software.

For more information on how Forth could help streamline your response and feedback mechanisms, as part of your member communication strategy, get in touch here or by emailing




Jamie McBride
Head of Marketing

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