The reasons are linked to a variety of factors, including higher fees on products tied to boosted allocations to expensive alternatives, active equity and niche asset classes. For example, already high fees for investing in private equity and debt funds, and hedge funds, are likely to increase increasing further as investors compete for a place in fewer deals.

Elsewhere, the increased spend on technology including data gathering and analysis, software and hardware to ensure the ability to work remotely, and a spike in the number of manager relationships and the associated fees is also adding to costs.

In one potentially harmful consequence, stubbornly high costs will maintain the pressure on high return handles, warns Anthony Skriba, senior consultant, Casey Quirk.

“Costs continue to rise and as this starts to impact plan returns, it is likely that most will have to maintain aggressive (return) targets.”