The Role of Trustees in Pension Funds
Posted: 27 Feb 2008
Date Written: December 12, 2007
Trustees have always played a vital role in the operation of pension plans in the UK. Most of the UK pension funds are organised as trusts- a legal entity that places the responsibility for taking care of certain assets in the hands of third parties, who are governed by trust deed, general trust law (Trustee Act 2000, Trustee Delegation Act 1999) and specific pension legislation (Pension Scheme Act 1993, Pension Act 1995, 2004). Historically, trust were devised to manage the affairs of people who, for various reasons, could not competently do so themselves, such being minors or those seriously ill. This dates back over 800 years in the UK legal practice. Hence, trustees are not required to have investment or financial experience but rather, through obligation and under common law, to act in good faith, exercise their discretion and promote the best interests of their beneficiaries (PLRC 1993).
Keywords: Pension, pension fund, trustees, DB, DC
JEL Classification: A10
Suggested Citation: Suggested Citation