Pensions Week articles from April 2008

Pensions Week archives from April 2008

News: Sipp first for Stagecoach sharesavers.
April 7, 2008... Byline: David Rowley The Stagecoach Group has become the first high profile employer to ditch its stakeholder scheme for a group self-invested personal pension (Sipp). The move will give 20,000 employees the ability to transfer shares...

News: Unite decries equity 'raids'.
April 7, 2008... Byline: David Ricketts Unite, the UK's largest union, has hit out at what it calls private equity 'raids' on company pension schemes. The comments follow a meeting between union officials and the pensions minister, Mike O'Brien, in...

This week: One man's Sipp is another man's pension.
April 7, 2008... Byline: David Rowley - Editor, Pensions Week The downside to all the hoopla on self-invested personal pensions (Sipps) being the next big thing is the warning about the potential for mis-selling. High charges, day trading and a bewildering...

News: Strathclyde turns to LDI to reduce risk.
April 7, 2008... Byline: David Rowley The GBP9.5bn Strathclyde pension fund has approved a shift into liability- driven investment (LDI) as part of a derisking process. The proposal for its No3 fund is currently seeking the go ahead from its sponsoring...

News: Reworked Myners principles should not burden industry.
April 7, 2008... Byline: David Ricketts A consultation looking to update the Myners principles has been welcomed, but should avoid increasing the regulatory burden on pensions. The Treasury has launched the consultation in response to last year's...

News: Effectiveness of policies in doubt from trustees.
April 7, 2008... Byline: David Ricketts Pension trustee boards lack confidence in their governance policies and risk management systems, according to a new study by PricewaterhouseCoopers (PwC). It found that despite a significant increase in the...

News: Tax-free payout made available to 1m.
April 7, 2008... Byline: David Ricketts Changes introduced to the finance bill will allow up to one million people to access a tax-free lump sum from their pension savings. Pension tax changes, which came into effect on A-day, introduced a standard...

News in brief.
April 7, 2008... The Cabinet Office has reappointed Hewitt Associates as actuarial advisers to civil service pension arrangements. Hewitt succeeded the Government Actuary's Department in 2003 when it was appointed actuary, making it the first firm from the...

News: Career average may suffer under IAS 19.
April 7, 2008... Byline: David Rowley The International Accounting Standards Board's (IASB) discussion paper on changes to IAS 19 has come under criticism for its unfairness towards career average plans. Phil Turner, principal at Mercer, said the...

News: Scheme solvency a major factor in analyst estimates.
April 7, 2008... Byline: David Rowley City analysts are placing increasing importance on the solvency of pension schemes when passing judgment on quoted companies, according to a new survey. While in 2007 only 57% of equity analysts were asking...

News: Pension fund surpluses rise by a third.
April 7, 2008... Byline: David Ricketts The combined surpluses of FTSE 100 companies' pension funds reached GBP40bn under FRS 17 at the end of March, the largest total since 2002. Despite falling share prices, Watson Wyatt estimated pension fund...

News: Investment platforms change the face of DC.
April 7, 2008... Byline: Tom Willetts Investment platforms are breaking down relationships between defined contribution (DC) pension schemes and fund managers, according to a leading investor. The platforms offer DC clients access to a range of funds...

News: Funds demand asset analytics to lower risk.
April 7, 2008... Byline: David Rowley Pension funds are increasingly reducing risk by asking their custodians to provide measurement and analytics of assets classes. State Street has seen increased demand for these services over the last two years,...

News in brief.
April 7, 2008... The GBP350m London Borough of Richmond-Upon-Thames pension fund has put out to tender 50% of its assets. The move could see the portfolio of balanced manager Schroders significantly reduced. Malcolm Smith, senior accountant at the...

News: Board resignations fail to solve conflicts.
April 7, 2008... Byline: David Ricketts Individuals who resign from trustee boards in a bid to avoid conflicts of interest, could do more harm than good, a leading independent trustee has claimed. This follows advice from the Pensions Regulator, which...

News: Numbers of firms ready for buyout rockets to 60% in last 12 months.
April 7, 2008... Byline: Tom Willetts Twice as many UK pension schemes are preparing for buyout than were a year ago, according to a survey by Watson Wyatt. More than 60% of delegates at a seminar held by the consultant firm said they were preparing to...

News: Pension victims safe from higher tax.
April 7, 2008... Byline: David Ricketts Wind-up victims will not have to pay a higher rate of tax on their compensation payments, the government has confirmed. Work and pensions secretary, James Purnell, said those receiving GBP40,000 or less a year...

News: Investment causes most trustee woes.
April 7, 2008... Byline: Tom Willetts Implementing an appropriate investment strategy for the future is the main worry of pension trustees, according to Aon Consulting. Its survey of 250 defined benefit scheme trustees found that 51% thought investment...

News: Trustees urged to include derivatives in pension funds.
April 7, 2008... Byline: Tom Willetts Pension schemes must embrace derivatives to help ensure pension scheme liabilities are matched by assets, according to a leading fund manager. Martin Hall, head of Axa Investment Management UK, said that pension...

News: 50% cut in contributions in 12 months.
April 7, 2008... Contributions to company pension schemes have fallen by half in the last 12 months, Prudential has claimed. Figures from the Prudential 2008 retirement savings report revealed those who pay into private or company pension arrangements have...

News: Capita moves closer to all-in-one service.
April 7, 2008... Byline: David Rowley Capita Hartshead has launched an investment consultancy arm to help achieve its ambition of offering an all-in-one pensions service for SMEs. The firm, noted for its pension administration services, already has an...

News: Equity allocations plummet following volatile period.
April 7, 2008... Byline: David Ricketts Allocations towards UK equities among pension funds saw their biggest one- year fall to date according to BNY Mellon Asset Servicing. In a general move towards bigger cash and bond holdings, UK pension funds...

News: Schemes seek buyout alternatives.
April 7, 2008... Byline: Tom Willetts Trustees and sponsor finance directors will increasingly embrace derisking strategies over the coming year, according to investment risk firm Valiance. The company said trustees and sponsors were eager to explore...

Awards: Get ready for PIPA 2008.
April 7, 2008... The most prestigious pensions and investment industry awards are almost upon us. Excitement and anticipation are reaching fever pitch among those providers who took the time and effort to enter the awards. Brought to you by the leading...

Current affairs: Default driven.
April 7, 2008... Byline: David Rowley One of the popular adages about defined contribution (DC) schemes is that only once senior executives start to join them in droves - following the closure of defined benefit schemes to future accrual - will we then see...

Current affairs: Longevity, the credit crunch and copycats.
April 7, 2008... Byline: Raj Mody So the credit crunch continues. Headlines continue to appear from the financial services sector about organisations in difficulty. Headlines have also been appearing lately about the Pensions Regulator's latest stance on...

The insider: Personal view - Timing is everything when it comes to committing to a lifetime annuity.
April 7, 2008... Byline: Kim Lerche-Thomsen Although the government allows retirees with money purchase pension arrangements to wait until age 75 to commit to a lifetime annuity, very few people use this flexibility. Given that a 65-year-old man will...

The Insider: Technical view - The facts of life in black and white.
April 7, 2008... Byline: John Lawson Be afraid. Be very afraid. Annuity pricing actuaries might just be left feeling that way after reading Robert N. Butler's The Longevity Revolution. Immortality is just one of the subjects under discussion in this...

Industry watch: Governance - You should be so lucky, lucky, lucky, lucky...
April 7, 2008... Byline: Tom Powdrill Are chief executives overpaid, and if so, is it rational for investors to take companies to task over high pay? According to a chapter in the new book The Logic of Life by the FT's 'Undercover Economist' Tim Harford,...

Industry watch: Notice board - NAPF conference and training dates 2008.(Conference notes)
April 7, 2008... Local authority conference - The new LGPS: ringing the changes May 19-21, 2008 The Belfry, Warwickshire The essential event for everyone in the Local Government Pension Scheme (LGPS) world, including elected members, officers,...

Industry watch: View from the bridge.
April 7, 2008... Byline: Norman Russell Ponte Vecchio The view from the bridge over the River Arno this Easter was decidedly murky. Being in Florence as Bear Stearns crumbled, I thought of the Florentine Medici Bank. It was founded in 1397 and finally...

Pensions workout: Beginner - Fixed income - Beginners' level.
April 7, 2008... Bonds used to be seen as less glamorous compared to their equity brethren because of their lower returns. However, the benefits of fixed income are increasingly being recognised. A properly constructed bond portfolio will not only help pension...

On the move: Hess to be hailed as global head at WW.
April 7, 2008... Byline: Tom Willetts Watson Wyatt is to promote Carl Hess to global head of investment consulting in July. Hess is taking over from Roger Urwin, who is taking on a global development and investment research role this summer. Hess...

On the move: Going places.
April 7, 2008... Skinner sworn into senior role at SWIP Scottish Widows Investment Partnership (SWIP) has appointed Guy Skinner as government bonds investment director, to strengthen its global bonds and economics team. He will report to Graeme...

On the move: Top 4 moves.
April 7, 2008... 01 - Ashpal Bhabra OLD - Bhabra was managing consultant at Watson Wyatt's Birmingham office NEW - He is promoted to head of corporate consulting in the UK Tel: 01737 241144 02 - Tony Hogbin OLD - Hogbin leaves Credit...

News: Trustees under fire for lack of swaps wisdom.
April 14, 2008... Byline: Tom Willetts Investment experts have broken ground to call for reform of the trustee model over concerns that sophisticated investing styles are being neglected. Their complaint is that most trustees lack understanding of swaps...

News: Fines required to rectify poor annuity process.
April 14, 2008... Byline: Tom Willetts Hard-hitting minimum standards and fines must be introduced to boost the performance of insurers in processing annuities, according to a leading broker. A survey of 6,000 annuity applications over the last three...

This week: Hurry, because it may not last.
April 14, 2008... Byline: David Rowley - Editor, Pensions Week One of the most common phrases used by fund managers over the last few months is 'tactical opportunities'. Distressed selling by overleveraged investors - hedge funds, banks, the risk-averse -...

News: Kingfisher offers group Sipp to staff.
April 14, 2008... Byline: David Rowley Kingfisher is giving its senior management the ability to place share awards into a group self-invested personal pension (Sipp). The scheme is not yet open to all employees (a move other employers have taken to...

News: DWP says decision on GPPs in PAs not a done deal.
April 14, 2008... Byline: David Ricketts The Department for Work and Pensions (DWP) has played down rumours that a decision allowing auto-enrolment into workplace group personal pensions (GPPs) is imminent. It follows speculation that the European...

News: Govt proposals remove regulator from restructure.
April 14, 2008... Byline: David Rowley The government has responded to concerns that employer debt regulations were making company restructuring too burdensome. Under new, simpler withdrawal proposals, employers can restructure without reference to the...

News: Value drop in securities offers opportunity.
April 14, 2008... Byline: David Rowley Distressed selling of mortgage and asset-backed securities has thrown up good opportunities for pension funds, according to Pimco. The fixed income specialist says selling from overleveraged investors such as hedge...

News in brief.
April 14, 2008... Martin Harris has quit his position as managing director of UK defined benefit (DB) at Fidelity International. Mark Miller is to increase his focus on the DB business and will be responsible for development and consultant relations. A...

News: Clout of commodities overlooked by schemes.
April 14, 2008... Byline: David Ricketts Pension funds should take more advantage of the increasing demand for commodities, a leading investment figure has suggested. David Aird, managing director of UK distribution at Investec Asset Management, said...

News: Liberata fined by FSA for failings in administration.
April 14, 2008... Byline: Tom Willetts Third-party administration firm Liberata Financial Services has been fined GBP525,000 by the Financial Services Authority (FSA) for failing to produce and issue documents correctly for life and pensions policyholders....

News: PPF provides payouts for 12,100 people.
April 14, 2008... Byline: Tom Willetts More than 12,100 people are receiving compensation from the Pension Protection Fund (PPF), or are in line to receive it in future. The PPF, which has just celebrated its third anniversary, said it was paying out...

News: Letter.
April 14, 2008... Pension Corporation has defended its takeover of Telent and denied it is in the business of raiding pension schemes, but does that defence really stand up to any close examination? (PW 07/04/08) Its motives were questioned because Telent is...

News: Negative outlook towards reforms.
April 14, 2008... Byline: Tom Willetts Most people in the UK fear public pension reforms will mean they will have to work longer and retire on less state benefits. Research from Axa found that 91% thought it would mean an increase in the number of years...

News in brief.
April 14, 2008... A former chartered accountant and company director has been fined for misleading the Pensions Regulator. Michael Sheridan, executive director of software company Mediqal, failed to pay GBP13,537 of staff pension contributions to the scheme,...

News: Adviser software a threat to schemes.
April 14, 2008... Byline: David Ricketts Pension schemes should be cautious of governance software offered by their advisers, leading independent providers have warned. Alistar Esam, managing director at independent governance software provider eShare,...

News: DC providers across Europe fail to review member options.
April 14, 2008... Byline: David Ricketts Almost half of defined contribution (DC) pension schemes across Europe do not regularly review the investment options offered to members, figures from a survey have found. Mercer's European pension survey,...

News: Laissez faire approach is best for DC plans.
April 14, 2008... Byline: David Ricketts Members of defined contribution (DC) plans could miss significant gains if they attempt to time their investment decisions. Research from Fidelity claims a GBP1,000 investment in the FTSE All Share in March 1993...

News: Investors warned of absolute return risk.
April 14, 2008... Byline: David Rowley Consultants are urging caution over the growing popularity of absolute return funds, due to concerns about manager risk. The multiple strategy funds have sought to offer cash plus returns that are uncorrelated to...

News: Success of hedge funds not enough to ward off critics.
April 14, 2008... Byline: Tom Willetts Hedge funds are facing a wave of criticism despite many delivering absolute returns during extreme volatility, according to the Alternative Investment Management Association (AIMA). Critics singled out hedge funds...

News: Short-term investors fuel pension volatility.
April 14, 2008... Byline: David Rowley The change in market ownership caused by the influx of short-term investors, is adding to the volatility headache of some pension funds. Speaking at the Association of Investment Companies conference for...

News: Emerging markets set to lure investors.
April 14, 2008... Byline: David Rowley There may be no better time to invest in emerging markets, according to two leading fund managers. Emerging market specialists Baring Asset Management and Ashmore Investment Management have both hailed the strong...

News: Risk awareness drives continued alternatives trend.
April 14, 2008... Byline: Tom Willetts Global tactical asset allocation, fund-of-hedge funds and active currency management are the most commonly used alternative asset classes among pension schemes. And the popularity of these styles will continue...

News: Insight launches high quality loan fund.
April 14, 2008... Byline: David Rowley A fixed income fund that offers a diversified source of alpha has been launched by Insight Investment. The Insight Loan Fund will invest in mainly high quality, senior loans, which Insight says can typically offer...

Awards: Get ready for PIPA 2008.
April 14, 2008... The most prestigious pensions and investment industry awards are almost upon us. Excitement and anticipation are reaching fever pitch among those providers who took the time and effort to enter the awards. Brought to you by the leading...

Current affairs: Talking heads.
April 14, 2008... Byline: Tom Willetts 1 - How sustainable are the current funding arrangements for local authority defined benefit pension schemes? 2 - Is local authority investment practice on a par with that found in private sector schemes? 3 -...

Current affairs: Financial news is seldom all bad.
April 14, 2008... Byline: Lindsay Tomlinson The biggest shock of my life in recent years was when it was revealed that the story about lemmings committing mass suicide to alleviate population explosions was complete nonsense. This myth was created by the...

The insider: Personal view - This could well be the first of many makeovers for the new-look LGPS.
April 14, 2008... Byline: Gary Delderfield After almost six years in the making, the 'new-look' Local Government Pension Scheme (LGPS) has taken effect this month, and brought with it a new regulatory framework, a new benefit structure and a new...

The Insider: Technical view - Following buyout and the flight from risk.
April 14, 2008... Byline: Phil Tranter Hardly a week goes by without a headline appearing somewhere publicising the latest pension scheme buyout. In two recent cases - Emap and Rank - risk removal was cited as a key reason for the buyout. Ian Griffiths,...

Industry watch: Governance - Harnessing the true power of the people.
April 14, 2008... Byline: Tom Powdrill The status of shareholder resolutions as an option in the investor's toolbox varies from market to market. In the UK they are still seen by some as the 'nuclear option' to be used only after engagement has...

Industry watch: Notice board - NAPF conferences, training & seminars.(Conference notes)
April 14, 2008... Local authority conference - The new LGPS: ringing the changes May 19-21, 2008 The Belfry, Warwickshire The essential event for everyone in the Local Government Pension Scheme (LGPS) world, including elected members, officers,...

Industry watch: View from the bridge.
April 14, 2008... Byline: Norman Russell Appearances Appearances can be deceptive. The appearance of the Olympic torch in London, en route from Olympia itself to Beijing, is portrayed as the continuation of an ancient Olympic tradition going back to the...

Pensions workout: Intermediate - Fixed income - Intermediate level.
April 14, 2008... While investments in government and corporate bonds have traditionally dominated fixed income portfolios, pension funds should consider the diversification benefits of opportunities beyond these traditional bond investments. This requires...

Special Focus: Introduction.
April 14, 2008... Byline: David Rowley - Editor, Pensions Week Cash, currency, currency overlay, fixed interest and money market funds. All of them are different but distinguishing between them is not always easy for the novice. This timely special focus on...

Special Focus: Looking for a safe bet.
April 14, 2008... Money market funds have traditionally offered pension schemes security of capital over the short term, rather than long-term growth. As cash lacks the ability to keep pace with inflation, pension schemes usually only transfer investments to...

Special Focus: Cash control.
April 14, 2008... As pension schemes look for ways to cope with the current credit crisis, solid cash management can be an excellent way of underpinning stability. Coupled with the development of enhanced cash management products and the ever-increasing role of...

Special Focus: Company focus - A word from the sponsor...
April 14, 2008... Background BNY Mellon Asset Management offers excellence through specialisation. Its asset managers are independent and focus entirely on managing money to provide investment excellence to clients. Its unique asset management...

On the move: Gardner elevated to CEO at MetLife Europe.
April 14, 2008... Byline: Tom Willetts MetLife Europe has strengthened its UK retirement and savings business with a pair of senior promotions. Ed Gardner becomes chief executive officer, and Dominic Grinstead becomes strategic development and marketing...

On the move: Going places.
April 14, 2008... Bowden promoted to partner at Allen & Overy Allen & Overy has promoted Neil Bowden to partner in its employment and benefits group as part of a global expansion drive. He will practice a range of duties and in particular advise...

On the move: Top 4 moves.
April 14, 2008... 01 - Carl Hess OLD - Hess was director of Watson Wyatt's investment consulting practice in the Americas NEW - He is promoted to global head of investment consulting in July Tel: 020 7222 8033 02 - Guy Skinner OLD -...

News: Regulator's role creates corp paralysis.
April 21, 2008... Byline: Tom Willetts and David Rowley Mergers and acquisitions are being put on hold while UK corporates wait to find out the full extent of the pension regulator's new powers. Pension advisers have also reported that corporate...

News: Ineos staff to strike over DB.
April 21, 2008... Byline: David Ricketts Workers at the Ineos oil refinery in Grangemouth, Scotland are to strike over plans to close the company's final salary pension scheme to new entrants. Up to 1,200 Unite members have voted in favour of a walk-out...

This week: The paper tiger bares its teeth.
April 21, 2008... Byline: David Rowley - Editor, Pensions Week Fear is no match for lengthy boredom. So while the introduction of moral hazard powers for the regulator in 2004 caused a lot of nail biting, much of this subsided when people became tired of...

News: Mislabelling risks balance of fairness.
April 21, 2008... Byline: David Ricketts Pension providers risk misleading investors who pump money into balanced or cautious managed funds. Funds that are labelled 'balanced' or 'cautious' do not reflect the investment approach their names may...

News: PD Pension Plan sold in biggest buyout of 2008.
April 21, 2008... Byline: Tom Willetts Paternoster has secured the largest pension buyout this year, for a scheme worth more than GBP400m. Under the terms of the deal, the assets of the PD Pension Plan will be transferred to the buyout firm in return...

News: Firm adopts target return DC fund to put staff at ease.
April 21, 2008... Byline: Tom Willetts A UK employer has become one of the first to use a target return fund as the default option for its defined contribution (DC) pension scheme. It is being used by a client of BlackRock to smooth out volatility and...

News: ACA says bill falls short of its goals.
April 21, 2008... Byline: David Ricketts The pension bill as it stands is not fit for purpose, the Association of Consulting Actuaries (ACA) has claimed. It argues the bill still does little to offer an alternative to switching employees into defined...

News in brief.
April 21, 2008... Tube drivers are threatening to walk out over staff transfers and pensions. The RMT union want assurance that 2,500 members from the failed private firm Metronet, whose contracts are being transferred to TfL, will be allowed to join the...

News: AMC will not raise enough for PA launch.
April 21, 2008... Byline: David Rowley The organisations chosen to run personal accounts may have to borrow between GBP1.7bn-GBP4.5bn for set-up and administration costs according to the Pensions Policy Institute (PPI). The estimates from the institute,...

News: F&C attributes global growth to emerging markets.
April 21, 2008... F&C has joined the growing number of fund managers highlighting the good opportunities for investment in emerging markets. The manager's faith in the asset class is based on its belief that emerging markets are now a bigger contributor to...