with whatever else the future might bring. returning to my suitcase analogy, who would have thought in 2019, never mind 1990, that those carefully packed clothes for a 2020 holiday in the caribbean would need to instead serve a staycation in the uk. things change and the ability of ma portfolios to adapt to this is key. on the solvency ii review, we have been open with the possible reform options we ’ ve been developing in the pre - consultation phase of the review. this has had the benefit of generating a lot of feedback, particularly in the months since our quantitative and qualitative information requests. as mentioned, we recently published a discussion paper [ 6 ] alongside hm treasury ’ s consultation document. we are now arranging further meetings to hear reactions to that discussion paper and will engage with all material provided to us. we will be asking many of you for more information in the next few weeks and months, because we need to explore further the areas that are important to us and the areas that you ’ ve said are important to you. this includes the impacts of any reforms to the balance sheet on capital requirements. we will listen and engage with all the information we receive. i don ’ t expect that we will agree with everything we hear – but the healthy tension and particularly the case study or experience backed arguments are going to help us to a better solution overall. the pra is keen to see the bpa sector develop in a way that allows it to safely and sustainably deliver on promises made to its long - term policyholders. as my discussion of the four rs shows – relying on regulation, in isolation, to ensure security of policyholder benefits is not enough. boards must be responsible for running their businesses prudently, consistent with safety and soundness ; firms need to invest in the right risk expertise to take on and manage the assets selected to back their long - term obligations to policyholders ; and resilience must be appropriate for the risks being run. we, as regulator, are keen to work with firms to create the conditions necessary for success now, and for the long - term. i am grateful to craig turnbull, jemima ayton, miranda hewkin - smith, alan sheppard, shamir patel, laurienne sherriff, giles woodruff, philip grundeu, anooj dodhia and wendy fu for their assistance in helping me prepare this speech. thank you. annex chart 1 : bulk purchase annuities ( bpas ) and

needs to be based. so let me begin with what the bpa market looks like today and how we got here. bulk pension annuity market developments starting with growth, chart 1 of the slides ( in the annex ) shows the growth in the bpa market over the last decade or so, highlighting that insurers have taken on around £200bn of pension scheme liabilities over that period. chart 2 shows that the bpa market is projected to have opportunity to grow at significant pace over the next ten years. the decline of defined benefit ( db ) pensions and the desire to secure future scheme member benefits continues to create demand from db pension scheme sponsors and trustees for de - risking or exit solutions. these should provide their members with a wellmanaged and cost - effective delivery of their outstanding pension benefits as they fall due over the coming decades – some extending more than 50 years into the future. life insurers also have the capability to use the relatively stable and long - term annuitant liabilities entrusted to them, to invest in productive assets for the benefit of future generations, including in the transition to net - zero carbon. while i talk about growth, overall this is really a transfer of promises - specifically promises made by a large number of employers converted to promises made by a smaller set of insurers. it is important to remember that this is not all new investment or credit creation. but in making this transfer there is a change in investment strategy that backs those promises. and, given there is still a much larger pool of db pension liabilities potentially available, as prudential regulator we need to know that the right package of incentives – and constraints – are in place for this transfer to be soundly managed in both the short and longer term. conditions for long - term sustainable growth the recent history of the uk life sector has shown us conditions that were not supportive of sustainable growth – or indeed policyholder protection. we need only cast our minds back a couple of decades to the existential challenges faced by some with - profits firms and the impact this had on benefits paid to policyholders. these challenges resulted from the inadequate capital resources supporting the promises they had made ( or were deemed to have made ) to their policyholders. whilst bpa balance sheets look very different, this nonetheless underlines our strong motivation for and expectations of effective governance, risk management and resilience, underpinned by a robust, transparent and risk - sensitive solvency system for long - term business.