Dalriada.Defined Contribution Consolidator

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  • Simplifying AVC & Small DC Scheme Management

    Additional Voluntary Contributions (AVCs) and small trust-based defined contribution pension schemes have never been straightforward. They often come with high charges, outdated policies, and an ever-increasing governance burden. For many schemes, they’re more trouble than they’re worth - adding complexity when you’re already juggling so much. That’s why we’ve developed Dalriada.Defined Contribution Consolidator (DCC), a smarter solution that delivers real value for your members while reducing the hassle for trustees and employers alike.

    For too long, AVCs have sat in the background, seen as too small to warrant attention. But the reality is, those small pots add up. Many of your members are typically paying fees of 0.75% p.a. or more on their AVCs - far higher than necessary. Worse still, the investment options often don’t match the needs of members today. And with every increasing regulation, keeping on top of AVC governance is only going to get harder.

    The challenges with legacy AVCs

    • High fees
      Many AVCs charge 0.75%+ p.a., reducing member savings.
    • Governance & compliance burdens
      Pensions Dashboard and Value for Money (VfM) regulations require greater oversight.
    • Legacy AVC provider exiting the market
      Trustees face uncertainty as some AVC providers (e.g., Santander in 2024) withdraw from the market, leaving schemes without viable options.
    • Buy-out delays
      AVCs create administrative roadblocks that slow down transactions.
    • Poor member engagement
      Outdated platforms lack transparency and digital access.
    • Disproportionate costs and activities
      AVCs typically represent a disproportionately high level of member complaints and IDRPs (Internal Dispute Resolution Process)

    Our Streamlined Solution: Dalriada.DCC

    As a professional trustee company, Dalriada is committed to delivering better member outcomes through strategic AVC consolidation. By collectively managing defined contribution pension schemes instead of treating them individually, we achieve economies of scale, reduce charges, enhance investment options and simplify governance - all within a high-quality DC Master Trust.

    Lower costs, greater benefits

    Partnering with Smart Master Trust, your members will enjoy fees that are a fraction of the typical Additional Voluntary Contribution charge. Trustees and employers can be confident that their AVCs are managed efficiently and fully compliant with evolving regulatory standards.

    Seamless Transition

    Our team, alongside leading legal and investment advisers (Gowling WLG, Hymans Robertson), ensures a streamlined, smooth and cost-effective consolidation process. Your members retain flexibility, including a convenient switch-back facility, enabling easy access to their AVCs to support tax-free cash withdrawals.

    Empowering Member Engagement

    The Smart Master Trust platform offers modern digital tools, enabling members to track their investments effortlessly. With a user-friendly digital interface, members can explore investment choices transparently, empowering informed decision-making and greater control over their pension savings.

    How it works

    Dalriada acts as lead trustee, overseeing the entire consolidation process in collaboration with:

    • Smart Pension – Master Trust administration & investment platform.

    This integrated approach ensures a seamless transition, risk reduction and long-term efficiency.

    Why Dalriada.DCC?

    Professional Pension Trustee led

    Dalriada is uniquely positioned as a professional trustee firm. With the DCC we have established a trustee solution to a trustee problem.  

    Background work done

    The DCC has already completed the market review, tendering process, price negotiation and established the template documents to complete the process, saving trustees considerable time, effort and money.

    Seamless transition process

    Dalriada has reinvented the AVC transfer process, ensuring efficiency while retaining member flexibility (e.g., switchback for PCLS). The DCC includes the document and project management, investment and legal advice, member communications, risk registers, signatory processes, record keeping and transition oversight.

    Value for Money (VfM)

    Delivering better member outcomes, ensuring an effective system of governance and enabling better operational costs to deliver value for employers.

    Better member outcomes

    Members will benefit from significantly reduced member charges, investment in a quality default fund (including lifestyling and ESG, with other options for self-selection), vastly improved member engagement with on-line functionality, a member App, dedicated helpline, and ‘Scam safe’ At and post-retirement options included, e.g. drawdown. Unlike typical AVCs, the DCMT provider is continuing to invest in R&D, to introduce future improvements and members will have  a switchback facility when taking retirement benefits for PCLS and / or added years.

    Dashboard solution

    For Schemes with 100 or more relevant members, Trustees need to do one of two things: comply with the Dashboard in respect of their AVCs or remove their AVCs from the Scheme. Trustees have until October 2026 to complete either project.

    For those that wish to comply, as well as making sure that data on main scheme benefits are available, trustees must also ensure that any AVCs are effectively integrated into the pensions Dashboard ecosystem.

    For those that would prefer to transfer their AVCs out of the scheme, removing the risks, liabilities and responsibilities, Dalriada has created a low cost, efficient and effective solution, while retaining the switchback facility for any member who wishes to use their AVC against their PCLS.

    Decumulation Solution

    Following the King’s Speech, upcoming pension reforms will require trustees to apply DC regulations to their arrangements—an area that has largely excluded AVCs until now. However, the cost of implementing a full DC decumulation framework for AVCs may be disproportionate to the value of the assets.

    Scale benefits

    In managing multiple schemes together, we enable cost efficiencies that individual schemes cannot achieve in isolation, reducing charges, enhancing investment options and simplifying governance – all within a high-quality DC Master Trust.

    Dalriada is uniquely positioned to lead the way in AVC consolidation.

    James Fitzsimmons, co-creator of the DCC and Accredited Professional Trustee at Dalriada Trustees, said:

    Trustees have struggled to improve Additional Voluntary Contributions terms and the investment platforms available to their members due to cost barriers, resource constraints, complexity and lack of a viable market, particularly for Schemes that can only negotiate in isolation. We believe our new solution will be the most effective way to tackle this problem. By consolidating AVC into a DC Master Trust, it will significantly reduce member charges, improve member engagement, and reduce the administration and governance burden for DB trustees.

    Ready to Simplify AVC Management?

    Discover exactly how Dalriada.DCC AVC Consolidation can lower your scheme’s costs, improve governance and enhance outcomes for your members.

    Explore AVC Consolidation in detail

  • Get in touch with us

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