Buzz: DC schemes failing to offer alternatives

clock • 1 min read

Almost six out of ten respondents thought defined contribution schemes could make better use of alternative assets, while just one in twenty disagreed. But many respondents admitted to being unsure of exactly how schemes could make these funds available to members.

"It might be appropriate for large target date funds, but they won't be appropriate for smaller funds or for individual 'pots'," said one contributor.

p19-chart-3

Others worried that there were few funds that were suitable for use in DC while some said the class was too expensive for DC members to access.

"I'm not sure how they would make use of these alternatives," said one correspondent. "It's expensive and if we are going to have all this brouhaha about costs, this is a nonstarter."

But one contributor said providers in Denmark, Norway, the Netherlands and Germany demonstrated "effective use of alternative assets" with "balancing risk controls as the core measure".

A respondent who thought DC schemes in the UK were getting this just about right said: "They are rarely used and that is probably correct. They will be generally too expensive and complicated for all but the very largest schemes."

More on Defined Contribution

DC Future Book highlights major growth in DC, with assets quadrupling since 2015

DC Future Book highlights major growth in DC, with assets quadrupling since 2015

DC Future Book shows median DC pot sizes reached £15,000 in 2024

Martin Richmond
clock 23 October 2025 • 3 min read
IFM Investors: Aligning pension capital with long-term growth

IFM Investors: Aligning pension capital with long-term growth

Cath Bowtell says the conversation between Australia and the UK around long-term investment is entering a new chapter

Cath Bowtell
clock 23 October 2025 • 4 min read
SPP: The message to the government is clear - don't mandate

SPP: The message to the government is clear - don't mandate

Jeremy Goodwin says mandation would ‘drive a coach and horses’ through the prudent person principle

Jeremy Goodwin
clock 14 October 2025 • 3 min read
Trustpilot