Pensions Talks Interview: Mark Ashworth, Director at Law Debenture

Mark Ashworth, Director at LawDeb Pension Trustees, shared his perspective on key developments in the pensions world. He highlighted the importance of balancing innovation with fiduciary responsibility, particularly as the government looks to unlock pension surpluses for economic growth. He also touched on the PPF’s levy reductions, the potential of AI in pensions, and the increasing shift towards professional trusteeship.

1. Last year was a particularly busy year for the world of pensions. We saw the government’s Mansion House announcements, along with the Pensions Investment review findings and a raft of upcoming pensions legislation.

What do you see as the key priorities for the first half of the year? What more can the industry do to ensure these policies are achieved successfully?

Keep calm and carry on!  More specifically, I think that we need to be open to new ideas and doing things differently, but we must steer by our fiduciary duty which has not changed. 

2. More than £60bn could be released from corporate pension schemes under proposal by Rachel Reeves last week, in order to kick start economic growth. The pension surpluses held in defined benefit schemes could be worth up to £100bn. 

Do you think this is a good idea? What measures will schemes / trustees need to put in place to ensure member benefits are secure?

I am wary of “big bang” solutions, especially when they involve using other peoples’ money!  But, as I said, we need to be open to the possibility that there are other ways of investing which might be in the best interests of pension scheme members. 

It is essential that any changes or plans are carried out with the consultation and agreement of the trustees - and many will harbour concerns over any Government plans which include mandatory rules on surplus release. The key challenge will be convincing trustees that the interests of their members remain the driving factor in any decisions made by the Government, and are balanced with consideration of the views of the sponsor as a key stakeholder.

3. At the end of December, the PPF made a decision to delay the 2025/ 2026 levy. Given the significant surplus within the PPF, it’s argued by many that it’s not right to continue to impose such substantial levies on schemes and sponsors. 

What reforms do you feel are needed to allow the PPF greater flexibility in setting these levies?

I am not an expert, but as the PPF is in essence an insurance vehicle, the premiums should not be more than are reasonably required for the risk being insured.  Where there is not a competitive market to determine the premium then care needs to be taken to infer the appropriate level.   To that end it was good to see that the PPF has recently announced that levies will be reduced from £100m to £45m for 2025-26, so the PPF is obviously listening!  I understand that current legislation restricts the ability to reduce the levy to zero and subsequently increase it again, and it would seem desirable to remove this quirk. 

4. AI has been a big topic of discussion. Last week we saw the government announce new plans to leverage technology and AI tools to streamline public service. Meanwhile on the other side of the Ocean, OpenAI and SoftBank announced that they would launch a massive US artificial intelligence infrastructure project, dubbed Stargate, in a move Donald Trump praised as a “declaration of confidence in America”.

What role do you think AI could contribute to pensions? What are the challenges for schemes?

AI brings risks and opportunities.  We are only in the foothills of both the range of risks and the range of opportunities.  The most important thing is to be alive to the possibilities, and to become familiar with using AI.  To that end I posed the question to Microsoft Copilot and it told me that “AI has the potential to significantly transform the pensions industry in several ways”, and went on to list the following headings for roles: operational efficiency, personalisation, decision-making, and fraud detection.  For challenges it listed data management, regulatory compliance, trust and transparency, and cost and implementation.  I would say that’s a pretty good list.  It is also mostly self-explanatory, but under the heading of data management AI noted that “pension schemes often deal with complex and dispersed data. Integrating AI requires converting legacy data into formats that AI can process, which can be challenging” That makes me think that AI is already familiar with the terrain on planet pensions!

5. A recent report from Lane Clark & Peacock showed that 51% of UK pension plans now have a professional trustee, of which a quarter have appointed a sole trustee. 

Do you see this as a trend set to continue in 2025? Are you experiencing more schemes demanding a more streamlined offering to meet growing demand for efficiencies? 

The short answer is “yes”.  The slightly longer answer is that we would be delighted to share our experience and insights.  These come from doing no more and no less than the right thing, in the most efficient way. We do think that the growing complexity and governance burden make an ever stronger case for professional trustees in general and corporate sole trustees in particular.  However, we continue to be committed to working with all schemes and all governance models, whether as chair, co-trustee or corporate sole trustee.