UK pension funds may soon be forced to disclose details of contracts with asset managers, after the government said there was “merit” in proposals to increase transparency tabled by a member of the upper house of Parliament.

Michael German, a Liberal Democrat peer in the UK upper house, tabled an amendment to the current Pension Scheme Bill – legislating for the introduction of defined ambition schemes – to allow members of trust schemes to request details of voting behaviour and the “selection, appointment and monitoring” of asset managers.

Nick Bourne, government whip in the Lords, said the amendments would go much further than currently proposed increases to scheme transparency, but that there was nonetheless merit in further examining all ideas tabled by German.

“However, we consider that greater transparency in relation to costs and charges, as well as about how schemes manage their investments, go hand in hand,” he said.

“As such, they would be better considered together as part of the same well-established transparency work programme, which is already under way and we are committed to consult on later this year.”

He said legislating for German’s proposals before the other changes surrounding fee disclosure came into force in April would risk introducing transparency in a “piecemeal and uncoordinated way”.

“Introducing these requirements through the amendment would remove the opportunity to consult all relevant stakeholders,” he said.

Instead, Bourne said the government would include the proposals in a forthcoming consultation planned by the Department for Work and Pensions, and could then potentially enact any changes as regulation.

ShareAction, which had been working with German on the amendment, welcomed the government’s commitment.

The responsible investment charity’s chief executive Catherine Howarth said: “We warmly welcome the government’s commitment to action that will give UK pension savers long overdue rights to information about what happens to their money.

“We urge pensions minister Steve Webb to move swiftly to set a consultation timetable to make these rights a reality in 2015.”

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