Defined Contribution Master Trusts: NEST, People's Pension and NOW: Pensions Explained

The auto-enrolment revolution that began in 2012 transformed UK workplace pension saving. At the centre of that transformation are master trusts — multi-employer occupational pension schemes that allow thousands of businesses to fulfil their auto-enrolment duties without the cost and complexity of establishing their own occupational schemes.

The three largest master trusts by membership — NEST (National Employment Savings Trust), People's Pension, and NOW: Pensions — between them hold pension assets on behalf of tens of millions of UK workers. For many UK nationals, including those who have spent time employed in the UK before moving abroad, a balance in one of these schemes represents a significant slice of their total pension savings.

This guide explains how the major master trusts work, how they compare, and what members — including UK expats with dormant balances — should know about managing assets in these schemes as of 2026.

What Is a Master Trust?

A master trust is a single occupational pension scheme that serves multiple unrelated employers under a common governance and administrative structure. Each employer's workers participate in the scheme, but assets are segregated by employer section.

Key features:

• Authorised by The Pensions Regulator (TPR): since 2018, all master trusts must be authorised by TPR under the master trust authorisation regime. This imposes significant governance, financial, and operational requirements.
• Trustee governance: independent trustee boards (rather than individual company trustees) manage the scheme in the interests of all members.
• Scale economics: pooled management allows lower per-member costs than most smaller individual schemes.
• Broad accessibility: master trusts accept employers of all sizes, from sole traders with one employee to large corporations.

NEST (National Employment Savings Trust)

NEST is a public corporation established by the UK government specifically to ensure that all employers — including the smallest businesses — had access to a qualifying auto-enrolment vehicle. NEST is governed by the NEST Corporation and is underpinned by a government guarantee.

Key facts about NEST:

• Membership: approximately 13 million members (and growing) as of 2026
• Annual management charge: 0.3% of fund value per year, plus a 1.8% charge on each new contribution
• Default fund: NEST Retirement Date Funds — a range of lifecycle funds that automatically shift from growth-oriented to capital-preservation assets as the member approaches their target retirement date
• Governance: independent NEST Corporation board
• Investment approach: globally diversified, predominantly passive with some active elements; responsible investment principles applied
• Restriction: historically, NEST had an annual contribution cap and a bar on transfers in and out — these restrictions were removed in April 2017, so contributions are no longer capped and transfers in and out are now accepted.

Who ends up in NEST? Often, employees of small and micro-employers who have chosen NEST as their auto-enrolment provider, or employees of larger employers who use NEST as a default. NEST is also the fall-back provider for any employer that cannot find an alternative — it cannot refuse an employer.

Cost structure: the contribution charge (1.8% per contribution) plus the annual management charge means total costs can appear higher on a per-year basis when contributions are small, but reduce in relative terms as the fund grows. For long-term members with large balances, the 0.3% annual charge alone compares favourably with many alternatives.

People's Pension

People's Pension is run by B&CE, a not-for-profit organisation with roots in the construction industry. It has grown substantially through the auto-enrolment period and is one of the UK's largest master trusts.

Key facts about People's Pension:

• Membership: approximately 6 million members as of 2026
• Annual management charge: 0.5% of fund value per year for the standard arrangement (lower for larger employer accounts)
• Default fund: a global equity and bond blended fund with a lifestyling approach that gradually de-risks as retirement approaches
• Not-for-profit structure: surpluses are retained in the scheme for members' benefit rather than distributed to shareholders
• No contribution charge: unlike NEST, there is no per-contribution charge, which can be advantageous for members making frequent or small contributions

Who ends up in People's Pension? Employees of employers in the construction sector (historically B&CE's core market) and a wide range of other employers who have selected People's Pension as their auto-enrolment provider. It is a popular choice for mid-size employers.

Investment options: members can choose from a range of fund options beyond the default, including Shariah-compliant and ethical investment options.

NOW: Pensions

NOW: Pensions is a master trust originally established with backing from Danish pension provider ATP (one of the world's largest pension funds). It has a clear focus on simplicity and low cost.

Key facts about NOW: Pensions:

• Membership: approximately 2 million members as of 2026
• Annual management charge: 0.3% of assets per year, plus a £1.50 per member per month administration fee
• Default fund: a single, straightforward diversified growth fund — no lifestyling, which can be an advantage or disadvantage depending on perspective
• Governance: independent trustee board; regulated by TPR under the authorisation regime
• Administration charge: the £1.50 monthly flat fee can be disproportionately high for members with very small balances (it represents a large percentage of a £100 pot, for example)

Who ends up in NOW: Pensions? Often employees of employers in sectors that have traditionally had lower pension engagement — hospitality, retail, and logistics. The scheme's simplicity has attracted employers who want a straightforward, low-governance-overhead solution.

Comparing the Three: A Practical Summary

Feature	NEST	People's Pension	NOW: Pensions
Annual charge (%)	0.3% + 1.8% per contribution	0.5%	0.3%
Fixed monthly fee	None	None	£1.50/month
Default fund	Lifecycle (retirement date)	Blended (lifestyling)	Single diversified growth
Transfer-in	Accepted	Accepted	Accepted
Transfer-out	Accepted	Accepted	Accepted
For-profit?	Public corporation	Not-for-profit	For-profit (Danish parent)
Suitable for small employers	Yes (cannot refuse)	Yes	Yes

No single master trust is objectively superior for all members in all circumstances. NEST's contribution charge disadvantages frequent small contributions but the government guarantee and 0.3% annual charge may appeal to risk-conscious members. People's Pension's not-for-profit status and absence of a contribution charge may suit members who prefer simpler, ethically aligned structures. NOW: Pensions' simplicity is attractive to some, though the monthly fee can bite small pots.

What Should Members Do With Dormant Master Trust Pots?

UK expats who have accumulated balances in NEST, People's Pension, or NOW: Pensions through UK employment and then moved abroad often leave these balances dormant. Common questions:

Can I leave it where it is? Yes. There is no requirement to move a master trust balance. The pot will continue to grow (subject to investment performance and charges) until you draw benefits at retirement.

Should I consolidate it into a SIPP? Potentially yes, but consider:

• The master trust balance is a defined contribution pot — straightforward to transfer
• Check for any valuable features (for example, some older policies have guaranteed annuity rates, though most auto-enrolment master trust pots do not)
• Compare the ongoing charges in the master trust against a modern SIPP platform — a SIPP with lower charges may be preferable for a growing pot
• Consider management — a single SIPP that consolidates multiple master trust pots is easier to oversee from abroad

Can I transfer to a QROPS? In principle yes, if the transfer meets the QROPS and OTC criteria. However, the same analysis applies as for any QROPS transfer — the OTC and ongoing charge differential make QROPS rarely cost-effective except for EEA-resident members transferring to an EEA QROPS.

What about contributions from abroad? If you are no longer employed in the UK, you cannot receive employer contributions to a master trust. You can make personal contributions to a SIPP (subject to the relevant UK earnings rules) but not typically to a master trust as a non-employee.

Access Rules and Drawdown

Master trusts are subject to UK pension access rules. Members can currently access benefits from age 55, with the normal minimum pension age rising to 57 from 6 April 2028. However, not all master trusts offer flexible drawdown directly:

• NEST: offers a drawdown facility directly, introduced in recent years.
• People's Pension: offers drawdown as well as annuity purchase.
• NOW: Pensions: historically focused on accumulation; drawdown may require transferring to another provider at retirement.

Members approaching retirement should check the drawdown options available directly from their master trust, or consider transferring to a SIPP that offers full flexible drawdown options, before choosing how to access benefits.

Compliance Caveat

Charges, fund options, and regulatory requirements for master trusts are subject to change. NEST's contribution charge structure has changed once already (the cap was removed; the charge has been reviewed). Nothing in this guide constitutes financial advice. Decisions about retaining or transferring master trust pots should be made following a review of the specific scheme terms and individual circumstances. The value of pension assets can fall as well as rise.

How Global Investments Can Help

Global Investments helps UK expats review dormant master trust balances alongside their other UK pension assets, assess the case for consolidation into a managed SIPP, and integrate the overall pension position into a coherent retirement income plan.

Whether the decision is to retain a master trust pot, consolidate it into a SIPP, or incorporate it into a broader drawdown strategy, we provide the analysis and regulated advice needed to make an informed decision.

Contact us for a confidential review of your UK pension position.