Master trust vs Workplace Personal Pension

Which is best?

Master trusts have seen tremendous growth over the past few years. Membership has grown from 200,000 members in 2010 to 16 million memberships holding more than £36 billion in members’ savings 1 in 2019.

What was a niche option is now mainstream, presenting employers with a choice when it comes to workplace pension provision. So which is best? This guide compares the main features.


A Workplace Personal Pension (WPP) includes group personal pension, group stakeholder and group self invested personal pension.

Workplace Personal Pension (WPP)

  • An investment product so it’s subject to Financial Conduct Authority (FCA) rules.
  • An Independent Governance Committee (IGC) oversees how providers operate all of their workplace personal pensions. They conduct a value for money assessment each year.
  • The IGC can include provider employees but the majority must be independent.
  • The IGC can recommend changes are made and can report a provider to the FCA if they think insufficient progress is being made.
  • IGC members are not legally liable for the decisions they make.
  • Chair of the IGC must produce an IGC Report reporting on governance activity each year.

Master trust

  • An occupational pension scheme so it’s subject to The Pensions Regulator (TPR) rules and must be authorised as a Master Trust by TPR.
  • The Scheme must have a majority independent board of trustees. At Aviva the board is made up of professional trustees, each with different specialist knowledge.
  • The Trustees must comply with legislation as well as TPR’s Code of Practice.
  • The Trustees are jointly and severally liable for everything that happens with the scheme. They can be individually fined for non compliance, or in extreme circumstances imprisoned.
  • The Chair of Trustees must produce a Chair’s Statement reporting on governance activity each year. 

Investment choice

Workplace Personal Pension (WPP)

  • The fund range available to members is determined by the provider’s investment governance team.
  • This could be a default, wider governed range and further self select range that is not subject to the same level of governance.
  • A group SIPP might offer even wider investment choice, including the ability to invest directly in shares and other investments. 

Master trust

  • The Trustees, with the help of a professional investment adviser, are responsible for choosing the fund range.
  • In the Aviva Master Trust, should an employer wish to have a bespoke fund range, they can appoint their own investment adviser to provide advice to the Trustees on their particular section.
  • The Trustees must carry out ongoing governance on every fund they offer, so fund ranges tend to be smaller than in a WPP.
  • The Trustees’ investment aims must be recorded in their Statement of Investment Principles. 


Workplace Personal Pension (WPP)

  • Charges are limited by the charge cap.
  • The IGC must report on the value for money provided to members by all of a provider’s workplace personal pension products in their IGC Report.

Master trust

  • Charges are limited by the charge cap.
  • The Trustees must report on the value for money provided to the scheme’s members in their Chair’s Statement.
  • In the case of Aviva’s Master Trust, the Trustees engage an independent employee benefit consultant to provide a view of how charges and services compare with the market. 


Workplace Personal Pension (WPP)

  • Member communications must meet FCA requirements to be clear, fair and not misleading.

Master trust

  • Member communications must meet TPR and DWP disclosure requirements and be accurate, clear, relevant and in plain English.
  • Aviva Master Trust communications are reviewed by the Trustees and have been reviewed by TPR as part of the master trust authorisation process.


Workplace Personal Pension (WPP)

  • WPP administration at Aviva is carried out on modern platforms which are all subject to the same control framework.
  • We have recently completed an independent AAF 01/06 admin and IT controls audit across our NGP and My Money platforms.
  • We have an ongoing programme to improve service and our ambition is to drive first point resolution of queries through investment in digital solutions, automation and process re-engineering.

Master trust

  • Master Trust administration at Aviva is carried out on the same platforms as some of our WPP (NGP and My Money).
  • Administration and IT controls were audited as part of the AAF 01/06 admin and IT controls audit.
  • Controls have also been evidenced to TPR as part of the master trust authorisation process.
  • The same ongoing programme to improve service as WPP, is in place. 

Security and sustainability

Workplace Personal Pension (WPP)

  • WPP are included in the Solvency II calculations that must be provided to the Prudential Regulatory Authority. This is a measure of the capital insurers need to hold to reduce the risk of insolvency.
  • Aviva holds 206% of the prescribed level of capital, calculated at 31 December 2019.
  • In the event of Aviva’s insolvency 100% of members benefits would be protected by the Financial Services Compensation Scheme (FSCS). 

Master trust

  • Master Trusts do not have to comply with Solvency II requirements. Members may not be protected by the FSCS either.
  • For the Aviva Master Trust, because the Trustees invest in Aviva products, members benefit from the same Solvency II and FSCS protections as a WPP member.
  • Aviva is also required by TPR to hold additional capital to enable the Scheme Trustees to manage any event prescribed in the Pension Schemes Act 2017 as a condition of continued authorisation. 

So, which is best?

There is no right or wrong answer and the margins are fine.

For example, if an employer has a workforce that is likely to want to invest in a wide range of funds, the fund range in a master trust might prove restrictive. But if an employer thinks a reduced fund range will make choices simpler, then a master trust may be a better choice. Similar considerations will apply across all of the above criteria.

We recognise that no two employers are alike, which is why Aviva offer both options. Employers need to remember that no two WPP or master trusts will be alike either. Different providers offer very different propositions and quality of service. While we have tried to cover the main differences that apply to the different schemes, employers should engage an adviser with experience in the market for workplace pensions to help them decide on the best scheme and best provider for them.

The value of a pension can fall as well as rise, employees could get back less than invested.

If you’d like more information on master trust and WPP, please get in touch with your Aviva contact.