Aegon Ltd. (AGN) Earnings Call Transcript & Summary

Hello, everyone, and welcome to Aegon's 2024 U.K. Strategy Teach-In Webinar. My name is Yves Cormier, and I'm the Head of Investor Relations. Thank you for joining us today. Over the course of the next 2 hours, we will address our plans to transform Aegon U.K. into a leading digital savings and retirement platform. First, you will hear from our CEO, Lard Friese, who will present our strategic vision for the U.K. market. Then we will pass the floor to our U.K. management team, starting with Michael Holliday Williams, the CEO of Aegon U.K. to expand on the transformation of our business and its ambitions. Ronnie Taylor, our U.K. Chief Distribution Officer, will then present our workplace and adviser platform businesses in more detail. Next, Tim Orton, CEO of Aegon U.K. subsidiary, Origin, will discuss our advice proposition. Aegon UK's CFO, Jim Ewing is going to present our other U.K. businesses, and how the transformation will benefit shareholders. After the presentations, we will have a Q&A session together with the presenters of today. But before we start, please take a moment to review our disclaimer on forward-looking statements, which you can find at the back of the presentation.

Thank you, Yves. I want to thank you all for joining this virtual event. Aegon's ambition is to create leading businesses in investment, protection and retirement solutions. A year ago at the Capital Markets Day, we presented to you the next chapter in Aegon's transformation and our ambition to build Transamerica into America's leading middle market life insurance and retirement company. Today, as part of this transformation, we are presenting our plans for our U.K. business. Aegon U.K. is well positioned to capture the opportunities in this attractive market, and we will tell you why. We have granular plans to transform the business, drive growth in our focus areas and create value for shareholders by investing in our franchise while gradually increasing remittances. I want to start by addressing the marketplace in which Aegon operates in the U.K. using Slide #4. The U.K. wealth management market is one of the largest and most developed markets in the world. The market today is highly fragmented across distributors, investment managers and platform administrators who play a central role to bring market participants together. Aegon U.K. operates at the heart of this industry with both its Workplace and Adviser platforms being among the largest ones. In addition, we have the possibility to provide advice and investment solutions to our clients. Using the next slide, I want to talk to the opportunities in the platform market. The long-term platform savings market is expected to grow considerably over the next decade. Assets under administration, or AUA, are predicted to grow by 10% per annum on average between 2023 and 2033. This is supported by favorable demographics with an aging population. The number of people over 65 in the U.K. is expected to increase by around EUR 3 million or 20% over the next decade, highlighting the higher demand for savings and decumulation solutions. People will need to save more, not less. In this market, user experience and the state of technological solutions are critical and they will be our focus point during the transformation. Let us first look at our achievements since the last strategic update of Aegon U.K. that we gave at the Capital Markets Day in 2020. In the U.K., the environment has not been favorable over the past 4 years, but despite this, we have achieved a lot. An important step was the rollout of a new modern user interface that we call Aegon Digital Experience. It is the basis for our transformation program. The business has also grown its customer base to around 3.7 million customers. Improved margins and efficiency was another goal. And despite the inflationary environment, we have worked hard and have reduced the addressable expense base. I'm also very satisfied with the workplace platform where net deposits have shown strong momentum. But net flows on the adviser platform have been more disappointing. Part of this was due to the macroeconomic context. And in addition, we have been impacted by market consolidation and vertical integration in the market. There is more work to do here. And later on, Mike and his team will elaborate on our plans. But let me give a summary on the next 2 slides, starting with Slide 7. Our goal is to build a champion in the U.K. savings and retirement market. And we are doing so from a position of strength. Our workplace platform has a proven track record being a top 3 player in terms of new schemes One, and we will continue to invest in it. For the adviser platform, we are focusing on 500 adviser firms, and we are investing in the platform to improve their experience and in turn, drive flows. F In addition, we operate an advice business. Our advice offering can leverage the workplace customer base as well as those of our partners like nationwide to drive flows. Our plans are expected to generate benefits for Aegon U.K. and the group as summarized on Slide #8. We are transforming Aegon U.K. into a leading digital savings and retirement platform. By 2028, these platforms will generate positive combined net flows of around GBP 5 billion per year and the total AUA will increase to over GBP 135 billion. At the same time, operating capital generation is expected to increase by 12% per year on average, driven by these growth franchises. The transformation of Aegon U.K. will take place over the 2024 to 2027 period and will be self-funded from Aegon U.K.'s capital generation and own funds. During this transformation phase, we aim to grow remittances by GBP 5 million per year, starting from a level of around GBP 100 million in 2024 with potential for higher growth after the investment period. This is an ambitious plan, but we have a strong position in the market and a strong management team. So I'm confident that we will deliver on it. I now want to invite Mike to share his thoughts on our prospects.

Thanks, Lard, and hello, everyone. I am Mike Holliday-Williams, CEO of the Aegon UK business. It's great to get a chance to give you an update on the U.K. business and the plans we've got for the future. I would like to start with Slide 10. Aegon in the U.K. has a large, scalable, strong interconnected business model with a workplace franchise at its heart. Our ambition is to be the U.K.'s leading digital savings and retirement platform. Today, we'll show you the significant progress we've made over the last few years and we'll take you through the plans we've put in place to drive growth, improve efficiency and become a modern digital business well placed to win in our target markets. Our aim is to deliver GBP 5 billion of positive net flows by 2028 across our growth franchises, build on our current flow momentum in workplace whilst turning net flow positive on our adviser platform. We're going to invest significantly over the next few years to achieve this whilst continuing to deliver stable growing dividends to the group. Let me first just explain our business model. We are well positioned in growing markets with some compelling competitive advantages. We've got 3 great franchises, our workplace platform, our adviser platform and our advice business. We also have 2 other businesses, which provide a significant source of earnings, those are the traditional product and institutional businesses. Our focus is on our growth franchises. The workplace franchise is in a strong position. We've consistently grown net flows, and we are maintaining our growth momentum. The adviser platform franchise has significant scale but is in a weaker position. It's been suffering negative net flows, mainly driven by a couple of things: increased cost of living, which has accelerated outflows; and the impact of market consolidation and vertical integration. However, we are continuing to grow in our target segment of advisers where we have a strong relationship. The Advice franchise now includes the recently acquired nationwide Adviser business as well as Origin, who offer advice to workplace employees and to private clients. Now as I said, some of the features of our business give us a competitive advantage. We have an interconnected business model with workplace customers very much at its heart. That means we've got one platform for advisers who want to manage customers from the workplace into advice on the same product. This is a big attraction for advisers targeting the corporate employer market. In 2023, they accounted for 1/3 of our workplace net flows. And we're a market leader in driving customer engagement and action. We have a unique customer engagement model, offering a breadth of education from award-winning pension gigs, guidance from our dedicated Aegon assisted teams plus holistic advice from Origin, our in-house advice business. In terms of distribution, we not only have strong relationships with all the major employee benefit consultants and adviser firms who use our platforms, but we also have distribution partnerships with Aon and Nationwide. Across our platforms, 80% of the assets are in low turnover pension products providing GBP 6 billion of regular customer premiums each year. Whilst our other businesses and in particular, traditional products, provide a stable source of income. So you can see why I say we've got some real competitive advantages. Now let's have a look at our business in terms of numbers on Slide 12. Overall, we have GBP 104 billion of assets and 2.5 million customers across our growth franchises. We currently have negative flows of GBP 1.2 billion as the positive net flows in our workplace franchise are offset by the negative net flows in our adviser platform franchise. Our ambition is to reach positive net flows of GBP 5 billion by 2028. Let's now turn to our markets. As you know, the markets we operate in remain attractive with some significant structural tailwinds. The Workplace and Adviser long-term savings market a second to continue to grow by around 10% per annum to 2033. And within this, the Workplace market is set to increase around 8% per annum. One of the big drivers here is clearly auto enrollment, which will add an additional GBP 700 billion to flows over the next 10 years. Additionally, there will be a GBP 3 million increase in the number of people over 65 and they will all need to make crucial choices in retirement for themselves and their family. Whilst many of these could benefit from advice, most will not pay for it. 6.5 million people say they are willing to pay for advice, but think it is too expensive. As such, customer education, guidance and advice is going to be critical in the future. It is also no surprise that in our sector, there is a big focus on technology, as this is a key enabler to providing content, experiences, tools and solutions that can really engage customers. This is an area of continued investment for us, and it is really central to our plans. Now before I talk to you about the progress we've made and our future plans, I want to use Slide 14 to first talk about our recent history and our ongoing journey to become a more focused and efficient business. The disposal of our annuity books and this year, our protection books, has meant we are more focused on our core savings and retirement proposition. The acquisition of Cofunds and the Black Rock Workplace businesses gave us scale positions in the Adviser platform market and entry into the master trust market. Since then, we've established Aegon as a leader in the Workplace pension market, developing a winning proposition and some key strategic relationships, especially with Aon. The outsourcing of the traditional products has enabled us to reduce our cost in that business, and we have now started our digital transformation on our growth platforms. The recent acquisition of Nationwide Advice business allows us to grow the platform and investment income from nationwide customers as well as access to those who need advice. Today, we are solely focused on building a leading digital savings and retirement platform business across our growth franchises. Now we made a good start on that journey but there is much more work to do to transform our business and base into some of our internal challenges. In particular, we need to simplify the complex technology and operational landscape we inherited through historical platform acquisitions. This complexity has delayed us improving the overall platform experience and in developing our proposition, particularly on our Adviser platform. So where are we in our journey to achieve our ambition? Well, we've made considerable progress over the last few years. In Workplace, we're in a great position. We've got a strong proposition, especially in the medium and large employer market and that includes employers who want to master trust. We provide market-leading insight and engagement tools to employers and members, and we offer a differentiated education, guidance and advice service. We've also got a unique distribution model, which has enabled us to drive strong net flows and be the #3 in the market for new schemes. In the adviser platform business, we are in a more challenged position, given we are having negative net flows, but we do have some strength. We have a target segment made up of around 500 independent adviser firms where we have strong relationships in place, and they provide us with positive net flows. Earlier this year, we started to deliver on our platform improvement program, significantly modernizing the digital experience, making our online customer journeys much easier and faster for advisers. As I have said, we have also got a single platform for advisers that want to manage customers from the workplace into advice. And we offer a pricing model that is very attractive for mass affluent customers. In Advice, we have both an open market and restricted proposition. And in total, we advised over 100,000 customers. The Origin business is focused on offering independent advice to employers and individuals and supports our overall workplace proposition. And the recently purchased Nationwide Advice business now called Aegon Financial Planning, supports 90,000 Advice customers on our platform. Importantly, it also provides distribution access to nationwide customers who need advice. Let's move on to Slide 16. Now whilst we have made progress, we are going to invest significantly to transform our growth franchises. In Workplace, we need to keep delivering ongoing improvements to build on our top 3 position in the market in terms of new scheme wins. So we're going to further digitalize and automate our processes. We're going to enhance our retirement solutions and we're going to engage our customers better through a more personalized digital experience. In our Adviser Platform franchise, we are planning to make some big improvements to return to positive net flows. We're going to simplify our technology and increase the automation of our processes to improve efficiency and increase our speed to market. We're going to enhance our proposition, closing down the key gaps. We're going to further improve the adviser experience and we'll remove the journey blockers to strengthen our primary platform status for our target 500 adviser firms. In Advice, we're going to get some efficiencies and increase the penetration of Advice. We're going to deliver cost synergies through integrating the recently acquired Aegon Financial Planning business. We're going to offer Advice to more of our own workplace customers and the nationwide customer base. And we're going to expand our Advice proposition to make it more accessible to more customers. So if I draw all that together, you can see we've got clear plans to transform our grade franchises and to become a modern digital growing business. We aim to invest significantly over the next few years to deliver this transformation. This will enable us to become the U.K.'s leading digital savings and retirement platform and ensure we are well placed to win in our growing attractive market segments. Now the combination of our current strengths and transformation plans are key to us achieving our ambitions. So Ronnie and then Tim will now cover these in more detail across our Workplace platform, Adviser platform and Advice franchises. So Ronnie, over to you.

Many thanks, Mike, and welcome, everyone. I'd now like to talk to the first of our growth franchises, Workplace, using Slide 18. As you can see here, the Workplace DC market is one of the largest and fastest-growing savings markets in the U.K. is forecast to grow 8% per annum over the next 5 years to total more than GBP 850 billion worth of assets. And within this, Master Trust business is predicted to grow at 18% and so making up over 1/3 of the market by 2028. At Aegon, our Workplace book is large and growing. It's also very stable. And by that, I mean our clients stay with us. We currently set up more than GBP 50 billion of assets and have been growing at 9% per annum over the last 4 years. In fact, over 10,000 employers across the U.K. have selected us as the workplace savings platform of choice. And because of that, we look after 1.8 million of their employees who delivered GBP 1.8 billion worth of net flows last year. We've got a great client retention rate of 98%, and we're also attracting 200 new corporate clients every year. In fact, overall, we generate 200,000 new individual customers a year through our Workplace franchise. So we're in a winning position in this attractive market, but excitingly, we've also got headroom to grow. And that's because by assets, we sit fifth, but we're actually a top 3 player for attracting new clients. That means we're growing faster than most of our competitors, and we're doing this at a time when many employers across the U.K. are actively reviewing their existing workplace savings arrangements. So our advantaged position in the workplace market is really based on 3 key attributes: Our differentiated proposition for employers, our personalized approach to employee engagement, and last but not least, our broad and unique distribution reach. I'd like to have a look at each in turn. So starting with employers, we've got specialist propositions for both medium and large-sized organizations. And we deliver these through an easy-to-use administration interface, which our clients truly love. Looking at employees, we offer a targeted and personalized approach to communication and engagement. And we've thought carefully about how best to do this, and we deliver it through a unique combination of 3 things: education, guidance and advice, both to and through retirement. And these services are supplied by best-of-breed organizations that we've established within the Aegon family over the last few years. Education from the award-winning pension geeks, deep specialists and contemporary communications. Guidance through our dedicated telephony support capability, Aegon Assist; and then Advice powered by our national advisory firm, Origin, which Tim will talk you through shortly. And we take our overall workplace proposition to market via 3 different distribution channels. Through corporate and retail advisers, we serve medium-sized employers. Working with employee benefit consultants, we cater for larger companies. But we also have a partnership with Aon, the global professional services firm where we power their proposition in the market to serve the savings needs of their largest corporate clients. And let's be really clear, nobody else has this breadth of distribution reach. It gives us great market coverage as well as real business balance with 1/3 of our workplace net flows coming through each channel every year. However, this is a highly competitive market. And on Slide 20, you can see how we plan to keep improving our offering for both our workplace employers and their employees. So first of all, we'll further digitize the journeys for our customers, and we're going to improve both engagement and their ability to self-serve. And at the same time, we're going to increase automation of front and back office processes. Secondly, we are enhancing our core proposition with a particular focus on personalized retirement solutions. And importantly, we're going to increase the allocation of default funds to private markets, details of which you'll have seen we announced the market last week. And last but not least, later this year, we will be introducing a brand-new personalized engagement capability for all of our workplace customers, which will significantly deepen their experience with Aegon. And we're calling this Milo. Milo from Aegon will enable customers to interact with us in many different ways. Its initial focus will be on pension consolidation so that through Milo, customers will look to search, find and transfer other pension pots into one combined plan. with enhanced features, competitive charges and contemporary investment solutions. But Milo is going to be much bigger than just pension consolidation. It will be a trusted guide that stays with our customers as they move into retirement by being their go-to destination for managing a whole range of different money milestones. So look, in Workplace, we are already very well-positioned. But we've also got ambitious plans to increase our footprint in this dynamic and growing market. And by successfully delivering on these plans, we aim to more than double our net flows to over GBP 5 billion per annum over the next 5 years. And this will see our asset base grow to over GBP 85 billion by 2028. And all of these results will be enabled by 3 key aspects: improving new client scheme on rates, maintaining regular contribution flow and also increasing retention of customers to and through retirement. So that's Workplace and I'd now like to move on to our adviser platform franchise starting on Slide 23. As you can see here, the overall financial adviser market in the U.K. is of a similar size to Workplace, GBP 600 billion in assets. And it's forecast to grow strongly at around 10% per annum over the next 5 years. This market supports a number of different business models, including vertically integrated operators and tight advice firms. And these organizations usually employ just one underlying platform administration solution. However, we play in the independent sector. Here, advisers typically select between 3 and 5 different platforms, matching different segments of their client base. And this represents a sizable portion of the overall U.K. market at around 40% of total inflows. And already delivered substantial business today for Aegon on our Adviser Platform. Our focus is on a target segment of 500 advisory firms within this population. These organizations hold 45% of our assets and deliver around 70% of our annual gross inflows. And although we are experiencing negative net flows across our overall advisory platform, we are net flow positive with these target advisers. In total, they write GBP 2.5 billion inflow per annum, giving us an 11% market share. And importantly, we hold primary platform status of 19% across this group. This investment makes for a very strong base in this market. but we can also see material upside potential from where we are today. And one other point I really want to stress, it's important to note that these very same advisers deliver 1/3 of the net flows in our workplace business that I covered earlier. We're very well positioned to be the platform of choice for a 500 target advisory firms because of 3 key areas. First of all, experience. Earlier this year, we completely refreshed the look and feel of the digital front-end experience advisers have with us, something we call Aegon Digital Experience or ADX. ADX has delivered seamless and intuity for journeys and feedback has been hugely positive. It also means that adviser platform is now on proprietary cloud-based technology, making it our engine to enable rapid proposition development moving forward. And you can see that in how we've delivered our first enhancement post-ADX within a month of the capability going live, a brand-new reporting suite for annual client reviews. Second, we have a differentiated proposition through one core platform that can support both workplace arrangements and individual savings for employees and their families. This provides a one-stop shop for advisers, something that's critically important to a number of our target firms. Let's be really clear. No one else has this capability. And then third, our platform solution is delivered through our partnership with GBST. This choice provides us with greater flexibility, but also matters to our target advisory firms, who value diversification of platforms, but also value diversification of underlying technology supplier. So put simply, we tick a lot of boxes for our target advisers, and we have plans to continue to improve our offering for this group. But standing back, our Adviser Platform is the one area of our overall U.K. business that does need some significant transformation. And I'd like to talk you through that now using Slide 25. So essentially, we need to simplify the underlying technology that supports our Adviser Platform business. And we also need to significantly improve the level of automation behind the scenes. So first up, we plan to update the key components that make up our overall technology estate. The delivery of ADX is a big step forward, but we need to do more in other areas like data sourcing, workflow management and telephony systems. Second, we're well progressed with our technology partner, GBST, to upgrade to SaaS, Software-as-a-Service cloud architecture, and that enables regular updates to our underlying platform capability. And then third, we plan to transition to existing legacy platforms across to our one core platform. And in parallel with this activity, we will modernize our overall administration capability. Operational processes will be automated, digitalization and self-service will be increased. And these changes will lead to less complexity, lower running costs and improved quality of service. Look, this combination of technology simplification and a drive to further automation will have significant outcomes across our overall U.K. business, as you can see here. They will future-proof our Adviser Platform while at the same time transforming our speed to market, but they'll also drive significant cost reduction across our overall U.K. addressable expense base. So moving forward, our plan is to build the leading digital savings advisory platform for our target segments. The technology and automation developments that I've just outlined, will be of significant benefit to our target advisers. But we also need to improve our offering to them in 2 other key areas as well. First, we need to address some known functionality gaps that our target advisers require to unlock greater flows in our direction. And second, we will continue the feedback has identified a number of journeys that can be further simplified and pushed into self-service. So we plan to deliver these improvements on an ongoing basis through a program of monthly platform upgrades. Pulling all of these components together will make a big difference for our Adviser Platform business, particularly with our target advisers. We've already got strong relationships with this group. Our delivered and planned experience improvements will take these relationships on to the next level. Then addressing functionality gaps will remove outstanding blockers to trade, so extending our addressable customer segments. And that, in turn, will unlock increased flows in our direction. So let me summarize all of this on Slide 27. We are very well positioned to be the platform of choice for our 500 target advisory firms. Sure. We've got work to do to fully achieve this, but we are confident that by successfully delivering on our plans, we will turn net flow positive overall by 2020. We're already GBP 0.5 billion net flow positive for the target Adviser segments, and we expect that to grow significantly over the next 5 years. Further, we aim to materially grow the portion of assets we have with this group, making up 2/3 of our total adviser platform assets by 2028. And all of these results will be enabled by focus on our target 500 independent advisers, driving an improved experience for this population and as a result, increasing market share and primary platform status. So that's how Adviser Platform franchise. I'd now like to hand you over to Tim to talk through our Advice business.

Thanks, Ronnie. I'm delighted to showcase our Advice business. Using Slide 29, I'm going to talk about how Advice business provides value to our interconnected business model. And then highlight our differentiated distribution potential. So starting with the synergies with Aegon U.K.'s broader business. As Ronnie described earlier, our advice business is a critical component in our current workplace proposition, providing employees with access to guidance and advice through their employer. And where aligned to client needs, our Advice business has the ability to provide additional flows by selecting products on Aegon's Adviser Platform, which is currently used for around GBP 5 billion of our assets under advice. It also has the potential to add further value through the use of investment solutions from Aegon, which are currently used for just over GBP 1 billion of assets under Advice. In terms of distribution, firstly, we have access to customers of Nationwide, the largest U.K. building society. We were really excited to launch Aegon Financial Planning, our restricted advice offering acquired from Nationwide earlier this year. We have an ongoing introducer agreement, and this extensive partnership gives access to their 16 million customers. In Origin, our holistic advice capability, we have a number of additional corporate partnerships giving us access to their customers or employees in their own workplace. And going forward, we'll also unlock advice access to the historic customer base of our workplace and traditional products businesses. Many of whom do not have a financial adviser. So as you can see, we have a fantastic connectivity to U.K. consumers and as advice needs to merge from each of these groups, we are really well placed to be the adviser of choice. Today, we're serving around 100,000 customers and by 2028, we expect to be generating around GBP 10 million of operating result per annum. And now using the next slide, I'm going to highlight our plans to achieve that. Generating value from our Advice business, we have plans across 3 dimensions. Firstly, integrating our Advice businesses and reducing costs. We're currently realigning the size of our Advice footprint to optimize productivity. We've identified further opportunities from creating synergies in the infrastructure supporting our advice businesses and through process and technology simplification. These actions will enable the business to enhance cost efficiency in the short term. Secondly, growing our customer value through advice. Many customers of our growing workplace business will have financial advice needs as their wealth increases, and they approach their retirement. So we'll be enhancing the visibility of our advice services to these customers and making it easier for them to get additional help with their financial planning. We'll also extend our restricted advice proposition to enable it to meet wider customer needs. This will enable us to leverage on our extensive distribution reach in both our Advice business and also our Adviser platform through the use of additional products or investment solutions from Aegon. These opportunities will supplement our revenues over the medium term. And thirdly, expanding our accessible customer segments. We see longer-term potential in the introduction of digital-first Advice. By digitalizing components, we'll reduce costs and make advice services more affordable to a wider range of customers who currently see it as being too expensive. And we've got the natural advantage of existing customer relationships as many of these customers sit in workplace schemes like Aegon. These services will be accessed via Milo, which Ronnie highlighted earlier. So in conclusion, these plans will build an Advice business, generating an additional profit stream in Aegon U.K. They'll also position our interconnected business model to be able to exploit further long-term value from the growing savings and retirement market. And now I'll hand to Jim to introduce our other businesses.

Thank you, Tim, and hello, everyone. I'm Jim Ewing, the CFO of Aegon U.K. I'm going to start with a brief summary of our 2 remaining businesses to complete the picture of Aegon U.K. These 2 businesses very much compliment our growth franchises and play an important role in the financial stability and evolution of Aegon U.K. Slide 32 presents our traditional products. They contributed GBP 83 million to the IFRS operating result in 2023. There are 2 components to our traditional products portfolio. First, our defined contribution pensions administration business, worth 1.3 million customers and about GBP 30 billion AUA. While it's not open to new schemes, this business remains open to new members from existing schemes. Regular outflows from members are largely offset by anticipated market growth and contributions from continuing our new scheme members. Second, we also have a small annuity book, which is running off and contributes to the increasing contribution. The book is managed day-to-day on an outsourced basis, allowing for a variabilized cost base. The 1.3 million customers are also a source of opportunity to meet customers' retirement needs with other Aegon services like for example, Milo, further demonstrating the interconnected nature of our business. Let me now move to the next slide. Our final business is Institutional. This is a low margin book with limited earnings contribution. This is the institutional trading and custody platform we provide to around 25 firms. It generates high volumes and sometimes volatile flows. At the same time, margins are very low, less than 1 basis point on average hence, earnings contribution is limited, albeit positive. Just as the traditional portfolio, this book also is managed on an outsourced basis allowing a variabilized cost base. We now have completed the overview of our businesses. Let me now move to the financial metrics, summarizing the impacts of everything you have heard today. My key headline is this. We are changing the earnings profile of Aegon U.K. towards our growth franchises as we expect both growth and cost efficiencies to emerge from the clear plans we set out today. This generates consistent and increasing operating capital generation and remittances, while we fund the investments required ourselves. Let me now turn to Slide 35 and discuss flows and assets under administration. During the planned period, we expect to turn our platform net flows positive, while AUA is expected to increase driven by increasing net flows. In the workplace platform, we expect to see our net flows improve from GBP 1.8 billion in '23 to around GBP 5 billion in 2028, increasing our recent growth. In the Adviser platform, we expect to see our flows turn positive by 2028 as net flows from our target 500 adviser firms start exceeding the natural attrition in the rest of the Adviser platform. As mentioned before, over the plan period, we expect outflows from other adviser firms where market consolidation and further vertical integration negatively impact our ability to grow. Overall, we target net inflows on our platforms of about GBP 5 billion in 2028, and we expect to realize about half of that by 2026 as we expect GBP 2.5 billion of net inflows by rent. We expect to see assets under administration of our platform business to increase from GBP 104 billion at the end of 2023 to over GBP 135 billion by the end of 2028, driven by significant growth from the Workplace platform. On this slide, we set out our IFRS operating result and the stable progression expected in the coming years. The key point here is that the operating result is expected to grow and the growth is driven by the increased operating result from the growth franchises, which more than offsets the impact from the traditional products gradually running off. We expect to grow from around GBP 165 million in 2024 to $190 million in 2028, enabled by the investment in our transformation of the platform. We do expect to see a decrease in 2024 from last year. This includes the impact of a favorable item in 2023 that we do not expect to reoccur and our methodology change. Finally, note that the transformation cost will be reflected in other charges and hence, are not reflected in the operating result. So let me now move to my final slide, Slide 37. Here, I will cover our increasing contribution to our group operating capital generation and cash at the holding during the transformation plan. We expect operating capital generation to increase from GBP 120 million in 2024 to around GBP 190 million in 2028, driven by the growth in platform AUA, increased efficiency and the progressive release of capital from the attritional book. In 2023, operating capital generation was elevated as we saw some favorable impact from underwriting variance. The operating level that we use for solvency remains unchanged at 150%. As of March 31, we were at 192% in our main U.K. legal entity, Scottish Equitable. The culmination of the strong solvency ratio and the growing operating capital generation will enable us to both fund the investment in the platform and also gradually increase remittances from the U.K. to the holding. We expect that the investment program will reduce the solvency ratio by a modest 2 to 3 percentage points on average per annum through to 2027. At the same time, we expect steadily increasing remittances by GBP 5 million per year, allowing for expected remittances of GBP 120 million in 2028. After the investment plan is completed in 2027, the reduced investment will also allow the potential for higher remittance growth as we see the full benefits of the transformation materialize. To sum up. The investments in the business are self-funded by Aegon U.K. and allow us to further improve our business while also increasing both operating capital generation and remittances. I will now hand back to Mike for the final summary.

Thanks, Jim. Now before I conclude, I just wanted to bring us back to customers and the current regulatory agenda using Slide 39. We have fully implemented consumer duty, and we had no major gaps and we've got continuous improvement plans in place. In terms of some of the key focus areas in the market, we expect no issues. We are confident in our approach on pricing, and we have limited back book exposure. In terms of interest on cash, our approach is compliant and our interest rates on the platform are competitive at around 3%, and they're available on our website. As for the ongoing advice risk, Origin has strong evidence of annual review meetings in place. All our plans are ultimately aimed at helping customers manage their savings to and through retirement, so they can live their best lives. This is the unifying purpose of Aegon and very much aligned to the U.K. regulatory agenda. So I hope you are now much clearer on the Aegon U.K. business. Let me just underline some of the key takeaways from today. We are laser-focused on our ambition to build the U.K.'s leading digital savings and retirement platform. We've got a large and scalable savings platform with some areas of real competitive advantage in an attractive market. We've made significant progress over the last few years, but there is more work to do. As such, we're going to significantly invest over the next few years in our transformation plans to drive growth and improve efficiency. This will enable us to build on our top 3 position in workplace to return to positive net flows on our Adviser platform, and increase the number of customers we advise in the workplace and through nationwide. Our transformation plans will also enable us to build a more modern digital business. And this includes future proofing and simplifying our technology; automating our processes, making them easier and more efficient to use; and further developing our digital experience to make it more personal, more adaptable and more engaging; and building the capability to continuously improve and develop our proposition, increasing our speed to market. We also see more opportunity from our interconnected business model, in particularly engaging more directly with our customers in more digital and innovative-wise like Milo to support consolidation and our customer journey to and through retirement. Our aim is to deliver GBP 5 billion net flow positive in 2028 across all our growth franchises; grow net flows in workplace whilst turning net flow positive in adviser platform; and increase operational capital generation and deliver stable growing dividends to the group. So thank you very much, and I would like to ask Lard and the other presenters now to join me for the Q&A.

Thank you very much. We will now start our Q&A session. Can I ask the operator to explain the procedure to ask questions. Thank you.

Ladies and gentlemen, we will now begin our Q&A session. [Operator Instructions] And a moment for the first question, please. Our first question comes from Farooq Hanif from JPMorgan.

Thanks very much, and thanks for a very informative presentation. firstly, a slightly cheeky question, I apologize. But why do you think you're a better owner of this business than some of the other scale players out there because everybody wants adviser and everybody wants workplace. So for example, is the ownership of Aegon Asset Management, an overlap. So if you could just give the strategic rationale. Secondly, you've obviously done disposals and M&A in the past. Why are those not part of the plans are both kind of bolt-ons to help with tech, but also disposals of traditional books like [ annuities ] ? And then lastly, sorry about the background noise, but lastly, one of the experiences I've had as being a customer of workplace pensions at various places I've worked is, the companies want to give you a tool Milo or some platform, but the pension is gate kept by the EBC, the Employee Benefit Consultant, has its own platform, which accesses the pension through. So none of that actually ever gets through how do you address that? How are you going to make the Milos actually used by customers rather than just being a shiny new tool that you offer, but doesn't get that engagement.

All right. Thank you, Farooq. So 3 questions here. I suggest we kick off with Lard on why we're the best owner of the business. And then Mike can probably add on it on the M&A side and also on how to make customers use Milo.

Yes, Farooq, thanks for your question. Well, everybody, as you said, wants to have adviser business, et cetera. And they want it for a reason. And the reason is that the U.K. market is a thriving large wealth management market, which is poised to grow on average by 10% per annum over the next decade, and where the demographic trends are in our favor. Consumers need to save more, not less. And in that market, we have a winning franchise with our workplace business, which is now the third largest in the market when it comes to net flows. And we have an advisory business and an adviser business or an advisory platform and advice business, which formed together a very strong interconnected opportunity to tap into the possibilities of that very large and growing market. We have a plan. That plan has been disclosed today, and we will discuss it in Q&A format as well. And we believe in that plan. And we think as a result, that would create a lot of value by investing in the plan and to build this champion franchise in this large and growing market. When it comes to asset management and the combination between the 2, in fact, they support each other. The asset manager already today manages roughly GBP 20 billion, GBP 25 billion for the business here in the U.K. and also recently in our workplace offering, we are going to launch UBC, which is a different investment strategy where our asset manager will be quite pivotal for. So we believe it's an attractive business. It's, by the way, also a very reliable business that is reliably remitting cash to the group and that will grow modestly in the coming years. And post that investment period, we'll have more scope for further growth of remittances to the group. So very core to the group.

I'll take the M&A. So I think our focus on our measure days were very -- we got a lot to do on our growth franchises, and this is where we see lots of value. So whilst there always might be things around bolt-ons to help technology, that's not our core focus. And when you look at traditional products, there's a lot of customers in traditional products business, over GBP 1 million. So when we've been talking about education, guidance and advice, pointing that our traditional products book is also very much part of our plan. And that brings me to Milo. You're right, right? There's lots of options out there, but nobody has really cracked engagement yet. And we see Milo as for us, just changing our role so that we become the pension provider for life not just a platform provider for this current job. So that's a very different shift for us. So we do become that trusted guide someone to turn to through key money moments that matter. So that's our plan here. We're really excited about it. We're taking a very digital mindset. So we're going to use data and test and learn as we go. And our focus very much is on consolidation where we see we can really improve and there's lots of opportunity and then at retirement and then into advice. So we're really excited about it. It's a big topic in the market, and we think this is going to give us a real advantage.

Thank you, Mike. Can we move to the next question, please?

Our next question comes from David Barma with Bank of America.

The first one, please, could you talk a little bit about the mix of products within your Adviser platform, please? And then secondly, could you come back on the measures you think will help you double your net flows on the workplace platform and especially how you plan to improve retention on customers and retirement.

Thank you, David. So I will pass on to Mike both questions on the mix of products and how we are doubling the flows on the workplace.

So doubling the flows on workplace. So our core focus here is look, we've already got momentum on workplace. We're #3 in the market in terms of new schemes today. We've got a proven track record of growing this business. We've got a 9% CAGR over the last few years. So we know we've got some real core strengths. So if you look at the proposition for employers, we're actually well today. We've got some good tools and we engage well with customers. If you look at the engagement for members, we are market leaders in education, in guidance and advice and then also really importantly, we've got a great strength in distribution. So we've got access to the market through EBCs, through a partnership with Aon as well as our Advisers. Now we know it's a competitive market to grow flow. So we also know that we need to improve the proposition further, and that's what we are talking about today in the presentation. There's much more room for us to automate and digitize making journeys more engaging and easier for employers and for customers overall. And employees always talked to me about app retirement solutions how can we make these really personally for customers and make the journeys a bit easier. So again, another core focus. And Lard talked about the UBC product. So how can we give customers access to better value for money pensions through, in this case, access to private markets. So obviously, that's critically important. And engagement, engagement is really, really key here. And through the innovations like Milo, it's going to give us a real opportunity to engage our end customers' case much more successfully, which is what employees are really, really focused on. So as I said, we've already got good momentum. And with the work and the plans we've put in place, we see we can really continue that.

Ronnie, on the mix of products?

Yes. Thanks for the question, David. So if you look at the Adviser platform, essentially, there's 3 core products in that. So it's a pension GIA and an ISA. And as it stands today, about 70% of those assets will be in pension products. the balance in GIA and ISA.

All right. Thank you, both. Can we move to the next question, please?

It's from Iain Pearce with BNP Paribas Global Market.

The first question I have was just on Slide 27. Looking at the Adviser flows from the non-targeted 500 adviser firms that you've highlighted. Those are basically -- well, the AUAs sets a half on your projection. I'm just wondering are you so negative on that particular segment? Are you sort of giving up on that segment to a certain degree and just focusing purely on that 500 target segment? The second one was just on -- if you could give some details on the total cost of the investment program. I think you gave some towards the end of that presentation, but if you could just give a bit more detail on the cost of the program. And then a final one, just on overall cost saves. What are you targeting in terms of overall cost saves? And is that cost save expected to be able to keep the margins of this business stable?

Thank you, Iain. So I suggest Mike takes the 3 questions. So advisers versus non-targeted AUAs, total cost and cost saves.

Okay. So on the first one, there's 2 things going on with flows, okay? So in our nontarget segment, we've got less control here overall. So these are advisers that are either moving into vertical integration or going into consolidation and are just treating as a legacy platform. So we're looking at that going forward. And whilst they will benefit from all the changes that we're making and improvements on the platform, we expect that to decrease. But on our focused 500 firms, they account for 70% of our gross flows today, GBP 23 billion of our assets. As you can see in the presentation, GBP 2.5 billion of gross flows. We're aiming to double that through all the improvement plans that we've got in place through the programs that we've put together. So by the end of the plan, we end up with a really positive growth trajectory on -- a positive trajectory on our gross sales, positive net flows overall and are really set to start to take market share. So that gives you a good flows. On the cost side, on the overall investment program, so I think we said that the total investment here, if you add it up, is about GBP 70 million to GBP 80 million per annum. So quite significant. So we're really, really excited about this because whilst we've made some good progress already when we talked about ADX and we've talked about some of the technology foundations that we've laid. We know there's a lot more to do here. And just to pick out a few points in our back office. We want to move into the cloud with GBST, allows us to be much more agile going forward. We want to automate and digitalize more of our processes. We want to simplify our technology, taking out some of the duplication and upgrading our infrastructure. And we want to keep improving our product as we go. And just say this is iterative. So this is month-on-month, quarter by quarter, year by year. This is not a kind of big bang approach, and we're looking to kind of get benefits as we go. So driving growth, reducing costs and really future-proofing the business. So that gives you a good sense of what it is and what we're targeting on overall. Now within that, the automation. You mentioned costs. So as we said in the presentation, it does drive efficiency in cost. So cost does come down, but it significantly improves the experience that we deliver into the marketplace as well.

All right. Thank you, Mike. Should we move to the next question, please?

Next question comes from Nasib Ahmed with UBS Investment Bank.

So yes, 3 questions for me. Firstly, on Royal London, is there more solvency benefit to come to once that transaction is completed this year? Or has that come through already in the solvency ratio? Secondly, on ADX. Can you talk a little bit more about integration of Cofunds and the ARC platform. Is that done? And is there a kind of one platform now facing the Adviser? And then finally, I think Mike mentioned investment income from the nationwide partnership. What's that? What investment income is Aegon earning on that partnership?

Thanks a lot, Nasib. Three questions. So maybe, Mike, you can start with the nationwide partnership and the Cofunds integration. And then Jim can conclude on the solvency benefit after the Royal London acquisition.

Okay. So on Nationwide, yes, so this business has come over to us this year. And there's a few benefits that we get in on here. So all the advisers have come over, so we get the advice cut income but this business is also on our platform. So we also get the platform income and we also use our investment solutions as well. So GBP 1 billion of the investments in our own solutions. So we get -- it's a restricted business, and therefore, we get the income across the whole piece there. On the Cofunds, yes. So sorry, I'll take the ADX and Cofunds as well. Yes, so ADX, we're already starting to simplify the processes for Advisers now. So for instance, there's a single log on, it doesn't matter what platform you've got. At the back end of this, they're all provided by GBST, the same supplier. So we're lucky just to make it really simple for advisers, whatever experience and whatever process they're going through, and we'll be doing this iteratively over time.

Yes. Thank you. So in terms of Royal London, so this is the protection business, which we have sold and that is due to complete early in the second half of the year. The vast majority of the solvency benefit came through last year when the full reassurance stage went in place. So there's a very modest amount to come through, but it's pretty much done now.

Next question comes from Steven Haywood from HSBC.

Good afternoon. Thank you very much. Three questions from me. One on the Adviser market. It is, obviously, struggling currently what is going to make this market turnaround going forward? And the sort of doubling of AUA over 10 years for the adviser market does seem challenging. I can understand Workplace and direct platforms doubling in size of AUA, but the adviser one seems to be struggling for the medium term. Second question, just on your sort of old traditional annuity books, et cetera. Can you remind me who they are outsourced to? Is it TCS? I think you had an agreement with them some time in the past. And are there any other outsourced businesses and companies that you outsource to? And then thirdly, on the traditional business again. Can you give us an indication of what the runoff rate is in terms of percentage of AUA that runs off per annum? And then what your target percentage might be to recapture that with your new products? Milo, app, et cetera?

All right. Thanks a lot, Steven. So I suggest Mike kicks off with the answer to the Adviser platform market and our outsourcing partners and also an [ Aegon ] recapture. And maybe Jim at the end can comment on the traditional products runoff.

Okay. If I can just do -- I'm going to do traditional first and outsourcing, if that's okay. So I think it's not TCS that we outsource this to is ATOS, and they've been doing that for some time. And they are the main outsourced partner that we use and the only one for traditional products. As I said, we've got over 1 million customers on the traditional products business. So they're a good target for Milo because they are tend to be slightly older customers. So we'll see how that goes. We're very much at the early stage of the development here. We'll be getting that kind of live at the beginning of next year. And as I said, we're going to focus on consolidation. So there's a lot to go out here and it's not a significant part of this plan, but we know it's going to add a lot more future value. Ronnie, do you want to do the adviser market? Because obviously, you're out there all the time.

Yes. I think if you look at the Adviser platform, it's probably best to split that into 2. So there's a nontarget segment we talked about earlier on, which are gradually moving away from us. But where our real focus on is on our target 500 advisers that are net flow positive today, and we expect them to grow their net flows with us. And there's a real reason for that. That was target 500, and that's part of the reason we've selected them. We've got great relationships with them today, really good service. They like our overall proposition. And they particularly like the fact that with our platform, you can do workplace as well as wealth management. What they say to me, and I meet these firms a lot is, look, there's 2 things you really need to improve to unlock further flows. First is experience. And we've definitely ticked that box with the rollout of ADX that Mike touched on earlier on, which has been a huge success in the market. The next thing we need to do is there are a number of discrete proposition gaps that we need to fill over the next few years and months that will really, we believe and we're told by our target firms will unlock flows in our direction. So over that 5-year period, what we're looking to do is double gross flows from our target time advisers, and that's where we see the growth in the Adviser platform.

Thank you, yes. In terms of traditional products, it's a slow runoff rate. So as we said in the presentation, they do make a significant contribution to the operating result and they do provide the 1.3 million customers for further Aegon services. The runoff, if you've seen in the presentation, the assets dropped by about 3% to 2028, which was really just the inflow and the market appreciation offset by the outflow. Further out, we would still continue to see a fairly small drop-off of less than 5% per annum, but it's a real slow runoff on that book.

Next question comes from [indiscernible] with Deutsche Bank.

Three questions from me. So the first one, you've spoken a lot about increasing flows assets, reducing costs over time. Just turning to the revenue side of things. How do you expect margins to evolve across the 3 growth businesses? Then the second question is just a clarification. Are you looking to increase the market share of those 500 Adviser businesses that use your primary platform. Or is it just solely targeting those 500 and keeping them on? And then the third question on Advice, what percentage of your advice customers and assets have come from nationwide? And what percentage are coming from the Workplace book?

All right. Thanks a lot, [ Riya ]. So for these 3 questions on revenue margins, market shares with the 500 and advice, Mike over to you.

So I think on the advice assets, they're 2 quite separate businesses at the moment. So Origin is around GBP 2 billion and the Advice business that we've brought in, there's 90,000 customers here, say GBP 5 billion of assets on those platforms. So that is the difference between the 2. In terms of looking to increase market share, you're right. So very much targeting on the 500. We have about 11% market share there. So about GBP 2.5 billion of gross flows, and that's what we're really looking to increase through all the activity. We don't -- so that's on revenues and margins, we don't really talk about revenues and margins in this presentation. Clearly, it's a very competitive market. Price is certainly not everything here. There's everything around the whole proposition. The reality is we've not seen a massive deterioration in margin over the last 3 years. It's been less than a bit across all of our platforms. So it gives us a good sense that we're already competitively priced, but we're significantly increasing the proposition and the value of that, that we're taking to market.

Our next question comes from Andrew Sinclair from Bank of America.

Okay. If we can't connect, maybe we move to the next question.

Sorry guys. Can you hear me now?

Yes.

Sorry about that. Apologies. Sorry, just looking at Slide 37, your remittance ratio actually seems to be falling over the course of the plan. I think it was 72% last year, 83% in 2024, 69% in '26 and 63% in 2028. Why is that drifting down? And what you see as a sustainable longer-term remittance ratio? That's question one. Second, I mean, you've talked a little bit about consolidation being a challenge that's still going on. What's the risk of those 500 financial advice firms that you're focusing on get consolidated away from you, if you get any desire to bring some of those in-house? And then third question is just when you're talking about being a leading platform in the U.K. On what basis do you contextualize leading? Is that AUM? Is that profit? Is that flows? On what basis do you want to be the U.K.'s leading [indiscernible] we think digital savings and retirement platform.

All right. Thanks a lot, Andrew. So these were 3 questions. I suggest we start with Mike on the risk of the 500 to be consolidated and what we mean by leading, and then Jim can comment on the remittance ratio.

So on the 500 and the consolidation. So let me just -- so we're focusing on the independent market overall. And that represents about 40% of the overall advice market. And obviously, the others are vertically integrated or tied, and we do see movement across the 2. But actually, that's been fairly resilient over the last few years, which is good. And then the 500 and -- 500 device represents 5,500 advisers. They're growing as well in line with the market but as well, many of them also write workplace business. And obviously, we've got a platform that can manage Workplace business and Advice business together. So that's really good because that's growing overall. And as I've just said as well, we've got an 11% market share. So with all the plans that are going on, we see that as a real opportunity to increase that. So the reality is that there's no reliance on that 500, but we're just absolutely focused on getting growth from them. In terms of the leading U.K. platform. There's many things that go into this. But where I would start with this, it's always the feedback that you're getting back from the advisers. Are they giving you a high score in terms of the proposition that you're delivering the experience, the service, the relationship that is out there? If you get those things right, you will get the flow. You will get the flow consistently from current customers and you'll get them to bring new customers over, and you'll get the recommendations, which really helps particularly in the workplace market. So it's getting that sustainable return. It's getting that recommendation from customers, and it's building some really good momentum. And we've definitely got that in some places, but this whole plan is about starting to improve that so we can really stand out and be that best platform in the U.K.

Thank you, Mike. Jim and the remittance ratio.

Sure. Thank you. Yes. So we are investing, which will grow the OCG as we've laid out in the presentation. Alongside, we're growing the remittance by 5 per annum up until 2028. At that point in time, that gives us potential for future growth and remittance rate thereafter, and we'll see what the shape of that looks like nearer the time.

Thank you, Jim. So the next question we have has come via our chart. It's from [ Patrick Lemmens ] from Robeco. So I will read the question. Do you use outside help to build IT systems and/or do you hire mostly your own IT people and build yourself? Examples are Guidewire, EPAM, Endeavor beyond what you already indicated, you use AI? Mike?

This is changing all the time. And obviously, we have some very close partnerships. So we happen to traditionally use TCS. And the people around TTS have been around our platform for many, many years, actually. But we also work very closely with GBST, and we've got some real experts within our own business. And what it's worth saying here is we have been delivering change programs. ADX was quite a big program. We've completely moved in the business to an agile way of operating on our front office platform and are bringing new capability in there all the time. But at times, it does make absolute sense to use third parties and we very much do that. AI. Actually for me, it's a great time to be investing in automation because we've gone out into the market to talk to people about automation and AI is very much part of that conversation. So it would be really interesting as we go through the various process and likely to bring a partner who's very expert in automation, and what capabilities can we get out of that? Because I think we're just right a bit being really adding value into a business. So I'm quite excited about investing in really automating and digitizing the business at this moment in time.

Next question from comes from Farquhar Murray with Bernstein Autonomous.

Three questions from me, if you can hear me. In broad terms, can you just outline how the investments of EUR 300 million split between the key growth franchises on Slide 16? And if you saw maybe which of the key transformation components within that? And then you've been very open about the challenges within the IT landscape and the proposition gap. So I just wondered if you could maybe give us some color in terms of fleshing out concretely what those proposition gaps are exactly? And then finally, with regards to Slide 37, you're intending to swing OCG by about GBP 70 million through the planning period. I just wondered if you could break those down between the 3 components you outlined earlier, namely AUM growth, capital release component and also some of the efficiencies.

All right. Thanks a lot, Farquhar. So I suggest Mike starts with the split of the investment between the 3 franchises and the IT landscape and the proposition gap. And then at the end, we can comment on the OCG increase. Maybe that was for Jim.

Yes. So thanks, and I'll let Ronnie do proposition gaps because he's living and breathing this every day. It's an area he loves. So investment but I think the first thing to say is the investments we're making benefit all franchises. So one of the things, the advantages we've got is we are scale across adviser platform and workplace and we do have one platform. And when we're talking about the investment we're making, it will benefit all of our franchises. And that's because we're replacing things like the back office and going into the cloud. And that sits across both of the key platform franchises, simplifying the technology and the applications and the infrastructure. Again, sits across all of those when we're doing automation and digitization. Actually, we're doing on journeys that sit across quite often both of those franchises as well. So we're not going to give splits between each one of them. The key message is, it does benefit all of our growth franchises, driving both growth and benefits overall. And it gives us a kind of technology, modern digital platform that we can continue to deploy and improve product from in the future. And talking about products, Ronnie, do you want to give an idea of some of the product gaps?

So talking about proposition gaps. This is very specifically with our adviser platform on our target 500 advisers. So a lot of what they at least to me is, first of all, we need to improve the experience, which we've done through ADX, which is great. The second thing is we've agreed a program of proposition gaps that we will deliver for those advisers over the next few years. And the top 3 examples just to bring those live for you. One is a refresh client reporting suite. That's a major part of an adviser's role today. Second, there's more flexibility around [indiscernible] portfolio management. And then the third is integration with back offices advisers. Now post consumer duty are looking for much richer data on their customers. So those 3 specifics, there are things that we're planning to deliver for our target advisers, not really starts to close the gaps between us and some of our competition.

Yes. And in terms of OCG growth. What I would say so the expense we showed on the slide to move back from 2028 towards pre-nationwide levels, which were laid out in the slide. So between that, which is probably roughly half of the $70 million, I would say, and the rest would come from the growth in the business and the market returns.

Thank you, Jim. So I think our final question is coming from the chart again. So I will read that question. Can you explain more about your partnerships with Aon and nationwide? Mike, I think that's for you.

Yes. I'll do nationwide, and I'm going to let Ronnie do Aon. Nationwide, as I said, we've had a long-term relationship with Nationwide and once they wanted to come out of Advice, obviously, with these assets being on our platform and is providing some of the solutions here, it made sense for us to buy them from them. We've integrated that into the business now where we brought them over in February. And as part of that, we've got a distribution agreement with Nationwide. Obviously, the 60 million customers are Nationwide and many of them still need advice. So they've got a kind of regional layout for these advisers. They connect to the local branches, and they provide some leads and continue to do so into the business. Over many years, they've built up a base of 90,000 customers, mainly providing [ ICEs ] every year. And we see there's an opportunity to not only to continue that distribution but extend the propositions that are also offering to their customers. So it's a great partnership, and it's been going really, really well. On Aon?

Yes. So we've got a great and long-term relationship with Aon. And essentially, we are the administration platform for Aon's Master Trust. They do the front end and the back end investment, we do administration. We got embedded systems and processes, and we're really focused on the big market opportunities ahead, particularly in Master Trust in the workplace space. And to give you a sense of scale, it will make up about 1/3 of our workplace net flows every year, but a fantastic relationship for us and for them.

All right. Thank you very much. So I think we're done with the Q&A. Lard, over to you.

Yes. So thank you very much for all your questions. It's been an invigorating session. As we explained today, we are building a champion in the attractive U.K. savings and retirement market, and I hope that you got a clear sense of how we wish to achieve this. Let me close off today's session by thanking the Aegon U.K. management team. And by thanking all of you for tuning into this strategy teaching session. Thanks again.