Global pension funds are sorely disappointed with the fees they pay for actively-managed funds of funds, according to a new survey.

New findings from London-based bfinance indicate that a majority of pension schemes favor lower fees from their alternative managers. What’s more, they want discounts of between 10% and 30% without conceding to a one-, two- or three-year lock-up in exchange.

However, 45% of investors said they are willing to consider trading liquidity for a reduction in fees.

“The traditional ‘2 and 20’ model of a 2% flat fee and a 20% performance fee is unlikely to survive last year’s market bloodletting,” according to the firm. “Our respondents have been negotiating hard with their asset managers to reduce fees. A medium-sized pension fund of a Scandinavian insurance company has been negotiating to reduce both base and performance fees on assets that it cannot redeem because of gate restrictions.”

bfinance also asked asset managers if they would consider offering a discount to investors if they agreed to a lock up: Sixty-eight percent of money managers say they are prepared to offer a discount if the investor agrees to a two-year lock up, while 46% said they’d do it for a one-year lock up and 79% for a three-year lock up.

However, there do not seem to be many takers among the surveyed schemes.

“In the past, we were in actively-managed funds of hedge funds with a one- and two-year lock-up,” says Richard Grottheim, chief investment officer of Swedish pension fund AP7. “Liquidity is one reason why we have been migrating out of FoHFs and into FoHF replicators. I would like to have the possibility of quick withdrawal in times of crisis.”

The survey was conducted in December and covered 10 countries and 32 pension schemes, both corporate and sovereign, with an average AUM of €5.4 billion (US$7.1 billion).