Pensions Week articles from December 2008

Pensions Week archives from December 2008

News: 5-year plan for LGPS is no quick fix.
December 1, 2008... Byline: David Rowley Changes to the Local Government Pension Scheme (LGPS) which introduce cost- sharing in five years time have been slammed as overcomplex and late. Under the proposals from the Department for Communities and Local...

News: Goddard quits Capital Cranfield to run own firm.
December 1, 2008... Byline: Charlie Kirby Charles Goddard has left independent trustee firm Capital Cranfield to run his own practice. Goddard and his employers have agreed his departure by mutual consent. Goddard's active clients at Capital Cranfield...

This week: A bolshy solution to complex risk.
December 1, 2008... Byline: David Rowley - Editor What would Leon Trotsky be doing in an article about pensions? If you can bear with me for two paragraphs, I can explain. The Russian revolutionary had this theory that the primary purpose of a workers'...

News: Ill-health guidance puts onus on GP estimations.
December 1, 2008... Byline: David Rowley Statutory guidance on how local authority government pension schemes should deal with ill-health retirement has failed to appease doctors. The guidance was hoped to allay protests over the processing of new rules,...

News: Economic turmoil heaps further strain on trustees.
December 1, 2008... Byline: Charlie Kirby The collapse of Woolworths and MFI last week highlights the increased burden trustees face in this turbulent time, says Redington Partners. Trustees are now forced not only to measure, manage, and monitor risks...

News: Breach of trust test case taken to ombudsman.
December 1, 2008... Byline: David Rowley A former financial director who saw his pension in payment cut from GBP66,000 to GBP17,000 will act as a test case for 200 fellow ex-employees. Paul Hughes, a former employee of Heath Lambert, suffered the cuts...

News: Stats hiding hedge fund managers' skills.
December 1, 2008... Byline: David Rowley Pension funds have put too much emphasis on the number of people employed in hedge funds when choosing managers, and should focus more on quality. In this week's roundtable discussion (p24-29), leading industry...

News in brief.
December 1, 2008... The GBP100m British Regional Airlines Group pension scheme has appointed Mercer as its actuarial and investment adviser. The 1,500-member scheme was originally established by Manx Airlines on the Isle of Man in 1983. The airline later...

News: Cameron moots DC for public sector.
December 1, 2008... Byline: Charlie Kirby Conservative leader David Cameron has angered the public sector by hinting a Conservative government would phase out their final salary pensions. During a meeting with businessmen at the Greater Manchester...

News: Asset lending should proceed with caution.
December 1, 2008... Schemes should suspend lending assets to third parties unless they fully understand the arrangements, according to an investment consultant. In advice sent to hundreds of pension schemes, Watson Wyatt advises them to review the type and...

News in brief.
December 1, 2008... The Association of Consulting Actuaries (ACA) has called on the government not to lose sight of reforms allowing risk-sharing in final salary schemes. Keith Barton, chairman of the ACA, said while the advent of personal accounts was...

News: FSA plans revamp of GPP advice charges.
December 1, 2008... Byline: Charlie Kirby Proposals for making explicit the remuneration advisers receive on pension products have been praised by the pensions industry. The proposals are contained in the Financial Services Authority's (FSA) interim...

News: PADA bolstered by passing of pensions bill.
December 1, 2008... Byline: Charlie Kirby The Pensions Act 2008's royal assent will breathe new life into the Personal Accounts Delivery Authority (PADA), according to chief executive Tim Jones. The man tasked with delivering personal accounts hinted that...

News in brief.
December 1, 2008... Only one in 10 employers predict personal accounts will go ahead as planned, according to a survey. The poll by JLT Benefit Solutions also found that only 27% of employers are positive about the scheme, while it is unknown to 74% of...

News: Demand for trustees leads to pay increase.
December 1, 2008... Byline: Tom Willetts The salaries of pension scheme board members are rising due to the onerous nature of trusteeship, according to Mercer. An annual survey by the firm found that the average salary of a trustee who is also a pensioner...

News: Market turbulence fails to quell desire for scheme buyout.
December 1, 2008... Byline: Tom Willetts Most schemes are still planning to offload their pension liabilities to an insurer despite the volatility in the market, according to a survey. MetLife Assurance found that 54% of trustees want to buy out with an...

News: Self-certification rules required for PAs.
December 1, 2008... Byline: Tom Willetts The government is under pressure to provide detail on the self-certification scheme for personal accounts. The certification procedure will be laid out in regulations, which will be published for consultation next...

In depth: Taxing times.
December 1, 2008... Byline: Charlie Kirby In what is being called the most significant pre-Budget report (PBR) of the decade, chancellor Alistair Darling announced a raft of changes to taxation, savings and pensions to be rolled out over the next three years....

In depth: The maths of 2012 just doesn't add up.
December 1, 2008... Byline: Steve Bee I was thinking about something I read the other day about the auto-enrolment of something like 10 million employees into pension saving in 2012. The pension saving that 10 million people are to be swept into in 2012 will...

Asset news: Short-selling squeeze will hit hedge funds.
December 1, 2008... Byline: Tom Willetts Unprecedented regulatory changes will shrink the hedge fund industry, according to Watson Wyatt. It predicts fund closures and manager consolidation as a consequence of global restrictions on short-selling,...

Asset news: Emerging markets offer long-term results.
December 1, 2008... Byline: Tom Willetts Pension schemes should buy and hold emerging market equities instead of selling them, according to research by an asset manager. A study by HSBC Global Asset Management found that taking a long-term view towards...

News in brief.
December 1, 2008... Blue Bay Asset Management has launched a high income loan fund in response to requests from institutional investors. Anthony Robertson, senior portfolio manager at Blue Bay, said: "Leveraged loans represent a particularly compelling...

In depth: Technical view - A measured response to liabilities.
December 1, 2008... Byline: Hitesh Patel The UK accounting standard on pensions, FRS 17, has been a controversial one, which has arguably driven significant changes in how companies manage their pension schemes. Under FRS 17, pension scheme assets are...

In depth: Personal view - The pensions lifeboat is in danger of sinking if levies are raised to the roof.
December 1, 2008... Byline: Ben Shaw The Pension Protection Fund (PPF) is a curious vehicle. It was set up by the government as a lifeboat scheme for members of inadequately funded pension schemes. However, it is not funded or underwritten by the state, but...

In depth: Jargon buster.
December 1, 2008... Leverage Also known as gearing of borrowing. Leverage is an American phrase which describes the position in which a company's equity or shareholders' funds have been geared up or leveraged by the use of borrowing. Liability-driven...

Industry watch: Governance - Is the golden carrot justified in a crunch?
December 1, 2008... Byline: Tom Powdrill Bonuses are the governance issue of the moment. At the same time that banks around the world are announcing that (quite rightly) they won't be paying their board members bonuses this year, thought is beginning to go...

Industry watch: Notice board - NAPF events and training.(Conference news)
December 1, 2008... NAPF Investment Conference 2009 March 11-13, Edinburgh International Conference Centre (EICC) The NAPF investment conference will focus on key issues, principally how asset owners and institutional investors should refocus their...

Industry watch: My life outside pensions.
December 1, 2008... Byline: Antony Hayes While home brewing has a bit of an image problem thanks to being associated with hard-up students, Antony has turned into something of a fine art or science (depending on how you look at it) and claims the beer he...

Pensions workout: Intermediate - Fiduciary management - Intermediate.
December 1, 2008... Fiduciary management is one option for trustees facing the relentless task of running and managing their scheme, but who is using it? From an initial search, the potential providers seem to include Goldman Sachs Asset Management (GSAM)...

Roundtable: Hedge fund is a catch-all term for many strategies. Is there a case for rebranding more cautious strategies to escape negative perceptions?(Discussion)
December 1, 2008... The panel KEVIN ARENSON - Head of asset management, Stenham Advisers CLIVE GILCHRIST - Managing director, Bestrustees JOHN GODDEN - Chief executive officer, IGS Group PHIL IRVINE Founder, Pirho Consulting TESSA...

On the move: Pair poised to revamp OMAM equity team.
December 1, 2008... Byline: Tom Willetts Old Mutual Asset Managers (OMAM) has appointed two UK equity analysts. Nick Williamson joins the firm's mid and small cap team from Citigroup, where he was a UK small and mid cap analyst covering various...

On the move: Going places.
December 1, 2008... Juttmann set to make big Impax Impax Group, the specialist environmental investment company, has appointed Victor Juttmann as investment manager. He joins the firm's private equity team from tax lawyers De Brauw Blackstone Westbroek,...

On the move: Top 4 moves.
December 1, 2008... 01 - Penny Green NEW - She is chief executive of the Superannuation Arrangements of the University of London (SAUL). Green also becomes chairman of Raising Standards of Pensions Administration. Tel: 020 7692 2000 02 - Emma du...

News: Trustees set to haggle down fees for 2009.
December 1, 2008... Byline: Charlie Kirby A growing number of trustees are looking to renegotiate their schemes' fees downwards to help cope with the economic downturn. Schemes are seeking ways to cut costs, and industry commentators, supported by...

News: CBI demands a public sector DB cost review.
December 1, 2008... Byline: Tom Willetts The Confederation of British Industry (CBI) is calling for an independent commission to scrutinise the costs and rules of public sector pensions. The employers' body is deman-ding a higher retirement age for most...

This week: Goodbye to all that?
December 1, 2008... Byline: David Rowley - Editor One of the most annoying things someone said to me this year was that interesting news is, by default, bad news. In an industry already groaning under enormous legislative burdens and the impact of falling...

News: Govt bins amendment to DB risk-sharing plan.
December 1, 2008... Byline: Tom Willetts The government has rejected a proposal to make risk-sharing defined benefit (DB) pension schemes easier to set up under secondary legislation. The move follows the publication of a Department for Work and Pensions...

News: Personal accounts' appeal gathers pace ahead of launch.
December 1, 2008... Byline: Tom Willetts The pensions industry is expected to embrace personal accounts next year as understanding of the scheme improves. In an exclusive interview with PW, pensions minister Rosie Winterton; Tim Jones, chief executive of...

News: Firms turn to salary sacrifice to slash costs.
December 1, 2008... Byline: David Rowley Salary sacrifice has moved to the top of employers' agendas for 2009 as a way of cutting costs from their pension arrangements. It is estimated that only around a third of employers use the process which can make...

News: Cheney crook to compensate PPF.
December 1, 2008... Byline: David Rowley Ian Selby has been ordered to pay GBP415,000 to the Pension Protection Fund to compensate for monies stolen from the Cheney Pension Fund. Selby must pay the sum within 12 months or face a further 18 months in...

News in brief.
December 1, 2008... The government's two-year cut in VAT is set to swell companies' defined benefit (DB) liabilities by GBP3bn. A similar amount could be added to the liabilities of the main unfunded public sector schemes, as it estimates that pensioners with...

News: Trustees must race to start 2009 valuations.
December 1, 2008... Byline: Tom Willetts Trustees must get a head start on next year's scheme valuations to improve the security of their pension scheme, according to an actuary. Many schemes are about to embark on their second actuarial valuation in...

News: Christmas cheer for FAS members.
December 1, 2008... Byline: Tom Willetts The government is to amend the Financial Assistance Scheme (FAS) to ensure all pension funds are eligible for compensation when their employer becomes insolvent. Under current arrangements, a fund can be...

News in brief.
December 1, 2008... State Street has won a contract to provide valuation, performance and risk analysis services to the PPF. Martin Clarke, the PPF's executive director of financial risk, said the deal had been struck because the scale and complexity of the...

News: Regulator endorses back-end planning.
December 1, 2008... Byline: David Rowley The Pensions Regulator has acknowledged that trustees will have to accept longer-term recovery plans where their sponsoring employer is at risk. In a move welcomed by the National Association of Pension Funds...

News: Regulator receives less clearance apps.
December 1, 2008... Byline: Tom Willetts Sponsors made fewer clearance applications to the Pensions Regulator last year, while schemes reduced the length of their deficit recovery plans. A report published by the regulator reveals clearance activity has...

News: UK's fiduciary market to grow in line with Holland.
December 1, 2008... Byline: David Rowley The value of UK pension fund assets run by fiduciary managers could reach GBP300bn by 2012, up from GBP2bn today, according to BlackRock. The fund manager bases its estimate on the growth of the Dutch market over...

Asset news: Commercial property mortgage fund unveiled.
December 1, 2008... Byline: Charlie Kirby A fund manager is looking to promote investment in the mortgages of commercial property as a source of stable returns in 2009. Business Lending is offering schemes the opportunity to invest in mortgages for...

News: Aviva cashes in on convertible bonds.
December 1, 2008... Byline: David Rowley Funds that take advantage of significant discounts in global convertible bonds have been launched by Aviva Investors and BlueBay Asset Management. The Aviva Investors Convertible Bond Opportunity Fund aims to...

News: Anticipated Q2 successes should not give false hope.
December 1, 2008... Byline: Charlie Kirby Expected market improvements in the second quarter of 2009 will only be a rally and not a recovery, according to Axa Investment Managers (Axa IM). Raphael Gallardo, a strategist at Axa IM, has predicted that the...

News: Downturn leaves DB funding in turmoil.
December 1, 2008... Byline: David Rowley Over 40% of defined benefit (DB) schemes believe they will no longer meet their planned timetable to become fully funded. A survey of clients by Watson Wyatt found that the impact of the credit crunch meant that...

News: HNW investors are more responsible.
December 1, 2008... High net worth individuals (HNWIs) have higher average levels of socially responsible investment (SRI) than institutional investors, according to a specialist SRI fund manager. The comments were made by Oxford Management, a fund manager...

News: The Savings Crisis.
December 1, 2008... Those promoting equity release plans to pensioners have been on the warpath again. SHIP (Safe Home Income Plans) the trade body that represents regulated UK equity release providers has revealed some worrying figures on the real purchasing...

Awards: UK Scheme Comms 2008.
December 1, 2008... Byline: Charlie Kirby The event Pensions and investment UK Scheme Communications 2008 The Pensions and Investment Group has completed its first UK pension scheme communication awards. Held over a relaxed lunchtime on December...

In depth: Talking heads.
December 1, 2008... 1 -Will there be more transparency in your processes as a result of recent market movements? 2 - Many assume hedge funds only represent their own interests and not that of their investors. What measures are in place to safeguard your...

In depth: Lifeboat is heading towards an iceberg.
December 1, 2008... Byline: Frank Field The government's initiated pensions lifeboat is in trouble. It is important that the government doesn't turn this trouble into a mega crisis. Readers will remember that the Pension Protection Fund (PPF) was set up...

In depth: Personal view - The wheels of change must be oiled with a viable accounting alternative.
December 1, 2008... Byline: Marcus Hurd By the end of 2018, pensions accounting will be a straightforward affair. There will be an open market in pension scheme liabilities actively traded on various exchanges around the world. Each relevant company will...

In depth: Jargon buster.
December 1, 2008... Net asset value The value of your assets after taking off anything you owe. For a company, it is the value of its assets that are attributable to, or owed to shareholders after taking off any debts. Funds such as investment trusts and...

In depth: Technical view - Approach consolidation with caution.
December 1, 2008... Byline: Stephen Ito In the current choppy economic waters, some commentators are predicting a wave of consolidation in 2009 as businesses look to weather the storm. Where survival is at stake, it may be crucial for a deal to be rushed...

Company comment: Group Sipp adapts to a changing environment.
December 1, 2008... Byline: Andy Dickson The usual news about pensions is that they are becalmed in the doldrums waiting for a surge of public interest in retirement saving. This could take some time, which is why good news around group self-invested personal...

Industry watch: Governance - Hoping less dangerous times lie ahead of us.
December 1, 2008... We live in extraordinary times. Last week, the BBC's business editor Robert Peston or the war correspondent for the credit crunch, if you prefer suggested in The Times that for developed economies, the current crisis was arguably more...

Industry watch: Notice board - NAPF training 2009.
December 1, 2008... NAPF training courses 2009: Next year looks set to be very challenging, a year when it is more essential than ever to be as prepared as possible and to build knowledge and awareness. The NAPF has expanded its range of courses to reflect the...

Industry watch: My life outside pensions.
December 1, 2008... Rising from genetically arty stock (Simon's father was a creative advertising director after learning his trade at Chelsea Art College), Simon at first ignored his instincts to paint and chose the path of Buddhism and dance to express himself....

Trusty30: Fallout from 2008.
December 1, 2008... As 2008 draws to a close, the ever-faithful respondents to the Trusty 30 survey have taken the time to review changes in the economic climate throughout the year. 01 -The cut in VAT, the fall in inflation, the fall in interest rates which...

Roundtable: Since the start of the credit crunch, how have pension funds changed in their views on fixed income?(Discussion)
December 1, 2008... The panel Peter Murray - Independent trustee, Bestrustees Andrew Welch - Head of client and consultant relationship management, Insight Investment John Hastings Partner, Hymans Robertson John Heskett - Investment adviser,...

On the move: Pioneer picks pair to drive client services.
December 1, 2008... Byline: Tom Willetts Pioneer Investments has made two senior appointments to develop its UK institutional team in London. Ian Burton (pic) joins as head of UK consultant relations, and Cecilia Wilson joins as client director. ...

On the move: Going places.
December 1, 2008... Bitner swaps B&B for Just Retirement Just Retirement Solutions, the distribution arm of Just Retirement, has appointed David Bitner as head of partnership development to generate growth. He joins from Bradford & Bingley, where worked...

On the move: Top 4 moves.
December 1, 2008... 01 - Sweta Chattopadhyay and Tim Tyshing OLD -Chattopadhyay leaves ABN Amro, and Tyshing leaves ANZ in Melbourne NEW - They become analysts in the Universities Superannuation Scheme's private equity team Tel: 0151 227 4711 02...

News: Commutation rules delayed until next year.
December 8, 2008... Byline: David Rowley The commutation of pensions below GBP2,000 has been delayed until 2009. The proposal, which would allow occupational schemes to commute such 'trivial' pensions to a lump sum without reference to an employee's...

This week: Real talent will shine through the fog.
December 8, 2008... Byline: David Rowley - Editor How times have changed. A four-page fund overview sent to me the other day by an investment manager showed it had lost 4% in 2008. The absolute return fund had clearly, woefully, failed to meet its target...

News: PPF: we're working to help schemes out.
December 8, 2008... Byline: Charlie Kirby The Pension Protection Fund (PPF) has pledged to be as flexible as it can for schemes struggling to pay the levy. In response to a letter from the Society of Pension Consultants (SPC) published in the Daily...

News: Interest rate cut won't be the last, say strategists.
December 8, 2008... Byline: Charlie Kirby The Bank of England's decision to cut interest rates to 2% won't be enough to prevent further rate cuts in 2009, according to economists. Edward Menashy, chief economist of stockbroker Charles Stanley, said the...

News: Flurry of large funds seek full outsourcing.
December 8, 2008... Byline: David Rowley Several multi-billion pound UK pension funds are in talks aimed at fully outsourcing investment decisions to implemented consultants. Leading providers, Cardano and Hewitts, have both revealed approaches from such...

News: DB revaluation cap brought forward.
December 8, 2008... Byline: David Rowley The start date for the 2.5%-a-year cap on the revaluation requirements for deferred benefits has been pushed forward to April 6, 2009. The delay has been welcomed by actuaries, who felt that employers needed more...

News in brief.
December 8, 2008... Hewitt Associates has announced the appointment of Andy Cox as managing director for the UK and Ireland. He succeeds Yvan Legris, who becomes one of Hewitt's global presidents. Cox has been with the firm for 18 years. The EC has...

News: Trustees should seek out best investments.
December 8, 2008... Byline: David Rowley A key lesson from the credit crunch is for trustees to take a more active role as investors, according to a group of institutional investors. The Marathon Club, a collaboration of big investors, made the...

News: New Star bows out to top UK banks.
December 8, 2008... Byline: Charlie Kirby New Star owner John Duffield has grudgingly agreed to hand over 95% of his troubled fund manager to Britain's top, part-nationalised banks. The combined Lloyds-HBOS bank will have an estimated 45% stake in New...

News: Winterthur trips up on Sipp fund management.
December 8, 2008... Byline: Charlie Kirby Winterthur has fallen foul of its fiduciary responsibilities as a trustee for a self-invested personal pension (Sipp), according to a pensions ombudsman determination. In the case of Mr N Cobbold vs Winterthur,...

News: PADA: alternative to the OMO is in pipeline.
December 8, 2008... Byline: Tom Willetts The personal accounts scheme could let a select group of insurers provide quotes to members as an alternative to the open market option (OMO). The quotes would appear on a website alongside a range of annuities...

News: Layoffs trigger pension claims.
December 8, 2008... Byline: Tom Willetts The flood of redundancies is expected to hit companies with thousands of pounds of enhanced benefit claims. The prediction follows significant redundancy announcements from BT, which is to cut 10,000 jobs by the...

Investment comment: Insight Investment - LDI accounts for both sides of the risk coin.
December 8, 2008... Byline: Andrew Giles - Managing director and head of financial solutions group Funding strategies are under the microscope, given the stresses current market conditions have introduced on both investment and counterparty exposures. At a...

News: Derivatives adopted to quell downside risk.
December 8, 2008... Byline: Tom Willetts The use of derivatives by fund managers is expected to increase despite market turbulence and record levels of redemptions from hedge funds. Research from Protiviti, the risk consultancy, found that 79% expect...

News: Fund manager hit rate sinks below 50%.
December 8, 2008... Byline: Tom Willetts Half of fund managers' investment decisions are incorrect, according to Inalytics, the equity manager selection and monitoring firm. The firm examined 215 long-only portfolios with a combined value of $152bn...

News in brief.
December 8, 2008... Greater evidence that monetary policy can impact on the real economy is needed before Schroders will move from an underweight position in equities. The fund manager said that a greater willingness by banks to lend and an improvement in...