Enforced Pooling or better manager competition?
It is an inherent contradiction in capitalism that, to be totally successful, it must become monopolistic, and therefore be a total failure at the same time. IPE reports that the FCA says that there is weak competition in real estate asset management, but then says that pooling might be the answer. Economies of scale, perhaps, but is this the right way to promote efficiency, by forcing more and more people into the arms of fewer providers? Is there instead a role for a competitive disrupter? Answers please on a postcard welcomed at the FCA.....
The UK’s Financial Conduct Authority (FCA) wants to see whether UK private sector occupational pension schemes could pool assets more effectively as a potential means of enabling them to extract better value for money from asset managers.On Friday, the regulator published the interim report on its study into the asset management market, saying it found evidence suggesting “there is weak price competition in a number of areas of the asset management industry”.The FCA has proposed a set of potential fixes for the problems it has found, one of which includes exploring the potential benefits of greater pooling of pension scheme assets.”
