Pensions Week articles from February 2005

Pensions Week archives from February 2005

News: Government raids AVCs to fund re-entry into state pension.
February 7, 2005... The government is raiding top-up payments by members whose pension schemes are re-entering the state system due to lack of funds. Members' additional voluntary contributions, (AVCs), which were considered separate from the scheme deficit,...

News: Opra revises trustee qualification checklist.
February 7, 2005... The Occupational Pensions Regulatory Authority (Opra) has formulated the basis for a trustee qualification in a bid to keep pensions professionals on the right side of the Pensions Act 2004. Working in conjunction with the pensions...

News: NAPF links up with Pensions Week in deal for members.
February 7, 2005... Pensions Week is to be distributed to all the members of the National Association of Pension Funds (NAPF) under an exclusive agreement, making it the first weekly title to be offered as part of NAPF membership. NAPF chief executive,...

News: Influx of requests for clearance statements could lead to added pressure on regulator.
February 7, 2005... Simple business transactions could become tangled in bureaucracy, as fears of non-compliance to moral hazard rules in the Pensions Act 2004 will cause a flood of requests for clearance statements to the new regulator in April, experts warned....

News: ECM sets up European Credit fund for retail and institutional investors under UCITS III rules.
February 7, 2005... European fixed income specialist manager European Credit Management (ECM) has become one of the first firms to take advantage of the undertaking for collective investment in transferable securities (UCITS) III rules to bring out a fund...

News: Standard Life's UK institutional business shines in 2004.
February 7, 2005... Standard Life Investments has reported a bumper year for its UK institutional business, with third-party funds under management reaching a record GBP18.3bn in 2004, bringing total funds under management to GBP95.7bn. Gross sales were up...

News: Capital Dynamics expands in UK with purchase of Westport.
February 7, 2005... US-based Capital Dynamics has acquired Westport Private Equity for an undisclosed sum. Private equity asset manager Capital Dynamics said it hopes the acquisition will help expand its business in the UK institutional market where it...

News: Investment Solutions to manage Coloplast DB scheme.
February 7, 2005... Coloplast, a UK subsidiary of a Danish disposable medical supplies manufacturer, has appointed Investment Solutions to manage its closed defined benefit pension scheme. The GBP9m scheme was previously managed by several different managers...

News: P3 to provide admin and payroll services for Aspen.
February 7, 2005... Aspen Actuaries and Pension Consultants has selected P3 Corporate Pensions Software to provide administration and pensioner payroll services. Aspen director of administration, Denise Blanks, said that the software had been purchased with...

News: ACA warns over prescriptive reforms.
February 7, 2005... The Association of Consulting Actuaries (ACA) has warned of disaster if the industry is forced to take on too much, too quickly in the wake of the findings in Derek Morris's review of the actuarial profession. Despite welcoming much of...

News: Francis hands over reins to Haddrill at ABI.
February 7, 2005... Stephen Haddrill is to succeed Mary Francis as director general of the Association of British Insurers (ABI) on 3 May 2005. Haddrill is currently director general of Fair Markets Group at the Department of Trade and Industry (DTI). He joins...

News: Industry bodies call for pensions reform in response to Turner.
February 7, 2005... The Association of British Insurers (ABI) has called for the Pensions Commission to be made into a permanent body to keep a watch on the UK's ability to boost retirement savings. In response to the Pensions Commission's report by Adair...

News: Consultants warn against compulsion.
February 7, 2005... Consultants have slammed compulsory pensions as a way of encouraging more people to save for their retirement. In response to the first Pensions Commission's report by Adair Turner, consultant Watson Wyatt said compulsory private pensions...

News: A-day rules put a damper on IPPs.
February 7, 2005... An attractive recruitment and retention tool among international banks and city institutions is likely to lose much of its allure after A-day, KPMG warned. David Fairs, pensions partner at KPMG, said international pension plans (IPPs) are...

News: Rules for calculating SMPI revised.
February 7, 2005... The government and the actuarial profession have revised the rules for calculating statutory money purchase illustrations (SMPI) for pension schemes. The changes follow consultation across the pensions, insurance and actuarial professions....

News: Pensions Institute slams default stakeholder investment options.
February 7, 2005... Stakeholder providers offering default investment options for inexperienced savers have come under fire from the Pensions Institute for offering arbitrary choices and being poorly designed. A study by the Pensions Institute and Cass...

News: USS financial advice trial set to begin next month.
February 7, 2005... The Universities Superannuation Scheme (USS) has started a trial of a pilot scheme to provide its members with access to individual financial advice. USS has joined forces with the Personal Finance Society (PFS), formerly the Society of...

News: Unconstrained benchmarks on the rise.
February 7, 2005... Pension funds are increasingly looking to adopt unconstrained benchmarks, according to consultant Hewitt Associates. Hewitt said that over the last 18 months, 20 clients, with a total of GBP9.6bn in fund assets between them, have allocated...

News: Northern Trust lands outsourcing deal from Insight.
February 7, 2005... Insight Investment is to outsource its back and middle office investment operations to Northern Trust. The functions to be outsourced include trade matching, confirmation and settlement, investment analysis, client reporting and performance...

News: GMO to manage 23% of Tower Hamlets' global equity mandate.
February 7, 2005... The London Borough of Tower Hamlets pension fund has selected US-owned GMO to manage a GBP100m global equity mandate. GMO will join Deutsche Asset Management and Schroder Investment Management to manage the fund. Under the new...

News: Inequalities found among executive pension provision.
February 7, 2005... Executive pension provision in the UK is characterised by "major inequalities", a report by Deloitte & Touche claimed. Research among FTSE 350 companies showed that executive pensions can be worth anywhere from 20% to 70% of salary. A...

News: PPS opens the door to its low set-up fee Sipp.
February 7, 2005... Premier Pension Services (PPS),part of the Jardine Lloyd Thompson group, has introduced an entry level self-invested personal pension (Sipp) with a low set-up fee. The Sipp - named Open - is aimed primarily at independent financial...

News: Trustee - Sizing up the Myners report.
February 7, 2005... Anyone would think that pensions professionals have nothing to do except respond to regulators; if the Pensions Act 2004 was not a sufficient challenge with its promised mountain of regulations and codes of conduct, we now have yet another...

News: T&G rejects 'work till you drop' culture for council staff.
February 7, 2005... The Transport & General Workers' Union (T&G) has clashed with the government over proposed changes to council workers' pension schemes, following Unison in calling for strike action. T&G, which plans to merge with Amicus and the GMB to...

News: Testing time for pension managers.
February 7, 2005... Pension managers will be able to demonstrate their competence in running a pension scheme by taking an industry exam offered by the Pensions Management Institute (PMI). The pension plan executive certificate (PPEC) has been created to...

News: Ombudsman watch.
February 7, 2005... The most powerful man in the world When the most powerful man in the world speaks we must all listen. When he speaks about pensions, we must report exactly what he had to say. According to my secretary, Megan, what he had to say cut short...

News: Funds join hands to demand green data.
February 7, 2005... Major UK pension funds have teamed up with other institutional investors around the globe to get hold of data on greenhouse gas emissions from 500 of the world's top companies. One hundred and forty-three institutional investors, including...

News: NAPF Notice Board.
February 7, 2005... NAPF Investment Conference 2005 16-18 March, Edinburgh The UK's premier investment conference returns to Edinburgh this year, with sessions designed to suit all levels of investment experience. As well as sessions covering a wide...

Governance Update: Watching out for executive compensation excesses.
February 7, 2005... The new pensions regime applying from April 2006 involves a GBP1.5m cap on the pension pot that employees can accrue over their working lives, a limit many company directors will comfortably exceed. In anticipation of this, the National...

NAPF Viewpoint: Pensions system needs stability.
February 7, 2005... If nothing else, the last couple of decades have provided compelling evidence that pensions and politics don't mix well. The tinkering of successive administrations has been largely well-intentioned but ineffective - and often...

Opinion: Leader - Don't let apathy rule the annuity market.
February 7, 2005... There is a lot of talk about compulsion in the pensions industry at the moment, mainly as a way of getting people to save more for retirement. But perhaps if retirement incomes are to be boosted, compulsion could be applied to more...

Opinion: Personal view - The rules of engagement.
February 7, 2005... Governance and socially responsible investment (GSRI) is increasingly gaining ground with pension trustees who recognise that an investment manager's shareholder engagement service is compatible with conventional financially driven asset...

Opinion: Inside view - The debate on tax transparent UK-based property investments.
February 7, 2005... What are the prospects of the government permitting tax transparency for UK- based property investment vehicles with tradable interests? This question is considered in light of December's pre-Budget report, which contained announcements on real...

People on the Move: MGI finds the right guy to be director of business development.
February 7, 2005... Mellon Global Investments (MGI) has appointed Guy Hudson as director of business development. Hudson's responsibilities will include the development of strategic partnerships and joint ventures with major financial institutions, with the...

People on the Move: Aegon selects Fleming as chief investment officer.
February 7, 2005... Aegon Asset Management has appointed Andrew Fleming as chief investment officer (CIO). Fleming joins from ABN Amro Asset Management, where he was CIO and global head of portfolio management. At ABN Amro, he led a team of around 400...

People on the Move: Droop to give Watson Wyatt's investment team a facelift.
February 7, 2005... Watson Wyatt has appointed Paul Droop as a senior investment consultant to its Dublin office. Droop joined from Six Continents, where he was a group economist. Before this, he worked for Ernst & Young ITEM Club, where he left as chief...

News Just In... : NAPF's proposed citizen's pension comes under fire from ABI and CBI.
February 7, 2005... Employers and insurance groups have spoken out against the proposed citizen's pension which threatens lucrative national insurance (NI) rebates and insurance premiums. The National Association of Pension Funds' (NAPF) proposed citizen's...

News Just In... : Standard Life fund will match liability with cash flow.
February 7, 2005... Standard Life Investments has introduced a suite of liability managed credit funds designed to deliver current and deferred pensioners' future payments. The fund is the first of its kind in the marketplace and is designed to meet a pension...

Special Supplement: Hedge Funds - Intro.
February 7, 2005... It has taken time to significantly whet institutional investors' appetites for hedge fund investment. UK pension fund trustees and their advisers have viewed the alternative asset class with suspicion for some time, and it is only in the...

Special Supplement: Hedge Funds - Hedge funds: a passing fad, or here to stay?
February 7, 2005... Are hedge funds a way of reducing portfolio risk, increasing returns and accessing the best fund managers in the world? Or are they simply a fad whose returns will slow because the industry has attracted too much money to be able to exploit...

Special Supplement: Hedge Funds - Taking the plunge into hedge fund investment.
February 7, 2005... Hedge funds achieved returns of less than 10% last year, underperforming more conventional asset classes, according to the Credit Suisse First Boston/Tremont hedge fund index. The average hedge fund rose just 9.64% in 2004 (compared with a...

Special Supplement: Hedge Funds - Using the right tool.
February 7, 2005... Investors in diversified funds-of-hedge-funds have been frustrated over the past few years by the product's low volatility, which seems to be linked to disappointing performances in the industry. This frustration has been heightened by the...

Special Supplement: Hedge Funds - Index trackers push hedge funds up the investing ladder.
February 7, 2005... The advent of investable hedge fund Indices in the middle of 2003 has brought a format to the hedge fund investor that is easily accessible and designed to bring the economic returns associated with hedge fund investments to a wider audience....

Special Supplement: Hedge Funds - Conquering the hedge funds universe through fund-of-funds.
February 7, 2005... Over the last few years, the universe of hedge funds has grown exponentially. Today, the worldwide market in hedge funds is estimated at more than GBP531bn with more than 7,500 active hedge funds. The growing complexity of the hedge fund...

Special Supplement: Manager Profile - EIM.
February 7, 2005... Background The EIM Group has been a pioneering force within the hedge fund industry since its foundation in 1992, specialising in tailor-made hedge-fund-of-fund portfolios. EIM is a privately owned firm with over 140 employees and prides...

Special Supplement: Manager Profile - HFR.
February 7, 2005... Background Hedge Fund Research, Inc - HFR Group - was established in January 1993 and is headquartered in Chicago. The company is best known for the most comprehensive and widely used hedge fund data and index service offered through...

Special Supplement: Manager Profile - Credit Agricole Asset Management.
February 7, 2005... Background Credit Agricole Asset Management, through its subsidiary Credit Agricole Alternative Investment Products Group (CA-AIPG), is a leading global player in alternative investments. CA-AIPG has more than 12 years' experience and...

News: Nestle adds pooled funds to its global pension plans.
February 21, 2005... Multinational Nestle has added a string of pooled funds to its global pensions platform which will be based in Ireland. The Switzerland-based global food and drinks giant, which has a UK scheme, has added a global index bond fund, a...

News: Shropshire equity revamp lets in Goldmans and Majedie.
February 21, 2005... The GBP670m Shropshire Council pension fund has ditched equity managers Barclays Global Investors, Deutsche Asset Management and State Street Global Advisors. The changes follow the council's decision to restructure its GBP160m equity...

News: Carter to fill Watts' shoes at Watsons.
February 21, 2005... Kevin Carter is to replace Nick Watts as head of European investment consulting at Watson Wyatt. Watts is stepping down for a year-long sabbatical. Carter has been working as part of the investment consulting management team since he...

News: Public sector dispute rages on as liabilities hit oe700bn.
February 21, 2005... Spiralling public sector pension liabilities of GBP700bn have dampened unions' attempts to reverse government proposals to change their pensions offering and threatens to spark widespread strike action. Pensions liabilities for the public...

News: LGPS changes could cut costs by oe200m.
February 21, 2005... The proposed changes to the local government pension scheme (LGPS) could reduce costs by GBP200m a year, according to Mercer Human Resource Consulting. Chris Hull, European partner and head of local government consulting at Mercer, said:...

News: Debt burden taking toll on corporate finances.
February 21, 2005... Large cap companies are finding it harder to deal with increasing pension liabilities according to a consultant. Pension liabilities represent 20% of market capitalisation for typical UK and Japanese companies. Only German companies...

News: Investors need more information on hedge fund risk factors.
February 21, 2005... Hedge fund managers must review their risk reporting processes if they are to survive the marketplace, according to research from Edhec business school and global broker Fimat. Edhec and Fimat said fund-of-hedge fund (FoHF) managers must...

News: West Yorkshire moves into hedge funds with oe260m investment.
February 21, 2005... The West Yorkshire Pension Fund (WYPF) is to invest GBP260m in five fund-of- hedge funds (FoHFs). The GBP5bn pension fund will invest the assets over the next three to four years. The five FoHFs, across which the GBP260m will be...

News: Large schemes to use EAI in manager selection.
February 21, 2005... One of UK's largest pension funds, the Universities Superannuation Scheme (USS), and local government scheme London Pensions Fund Authority (LPFA) are to use the Enhanced Analytics Initiative (EAI) as one of their manager selection criterion....

News: MLIM extends cash fund range.
February 21, 2005... Merrill Lynch Investment Managers (MLIM) has extended its cash fund range with another fund. The Merrill Lynch Atlas Optimum Libor+ fund consists of a money market fund and fund-of-hedge funds. It's a euro denominated fund, which aims...

News: Pirc attacks DTI report on pay.
February 21, 2005... A government report on directors' remuneration has come under fire from pensions experts. Pensions Investment Research Consultants (Pirc) attacked remuneration advisers Deloitte & Touche's report for the Department for Trade & Industry...

News: Vacancy rates fall inside M25.
February 21, 2005... Investment activity in the south east of England is set to boom this year, according to an international property adviser. Research by Knight Frank showed that vacancy rates in the prime location of the M25 has dipped by 18% over the last...

News: Letters - Pat on the government's back.
February 21, 2005... We have noticed that the Myners principles for institutional investment decision-making are being adhered to by trustees. We do, however, welcome the move by the government to highlight these four issues. In our opinion, being conversant with...

News: Letters - Insolvency and ppf assessment.
February 21, 2005... We have received several queries from trustees who have said that they are considering applying for entry into the PPF in April 2005, on the basis that they believe their employer is unlikely to continue as a going concern (section 129 of...

News: Letters - Information secure with opra.
February 21, 2005... I am very concerned that the article in PW14.02.05 ("Clearance process leaves employers with serious concern") which suggests that information given to the pensions regulator to obtain a clearance statement could be given to competitors under...

News: Regulator will use a lighter touch with small schemes.
February 21, 2005... The government has taken steps to loosen the regulatory grip on small pension schemes in a bid to reshape risk-based policy. The Occupational Pensions Regulatory Authority (Opra) has opted for a lighter regulatory touch to be adopted when...

News: Opra trustee checklist comes under fire.
February 21, 2005... The trustee training checklist produced by the Occupational Pensions Regulatory Authority (Opra) is a "daunting challenge", according to actuary Lane Clark & Peacock (LCP). Bob Scott, partner at LCP, said: "While the Pensions Act 2004...

News: PPF guidance is on the web.
February 21, 2005... The Pension Protection Fund (PPF) has produced a website to provide guidance for schemes. The PPF site provides information about the PPF as well as access to documents it has published. Subscribers can opt to be alerted via the site's...

News: Revenue explains Finance Act changes.
February 21, 2005... The Inland Revenue has issued a technical document outlining how pensions would be affected following changes made to the Finance Act 2004. The document covers benefits and contributions, lifetime allowance, unauthorised payments and...

News: Alternative investments seen as the way forward.
February 21, 2005... UK pension funds see investing in alternative and unconstrained investments as the way forward, according to research from consultant Watson Wyatt. The report showed Watson Wyatt's pension fund clients had doubled their allocation to...

News: L&G opens video link to A-day.
February 21, 2005... Legal & General (L&G) has introduced its latest series of video links to help advisers prepare for A-day. The link aims to help those in the individual pensions market and illustrates how financial advisers can help business clients fund...

News: Left field - Attracted to the flame.
February 21, 2005... The government's position on a citizen's pension strikes me as being like a moth dive-bombing a lighted candle. The attraction to the moth of a bright centre of light in the midst of darkness is understandable enough. And while the moth's brain...

News: High earners could lose oe8.5bn to govt after A-day.
February 21, 2005... The government stands to gain from a tax windfall of around GBP8.25bn if people don't protect their pension assets according to Alexander Forbes Financial Services (AFFS). Pensions that rise above the lifetime allowance of GBP1.5m are...

News: Prudential, Halifax to pay for warranty mix-up.
February 21, 2005... The pensions ombudsman, David Laverick, has directed Prudential and Halifax to shell out over GBP7,000 each for delaying a transfer request. The scheme member - Alan Craythorne - claimed he lost more than GBP11,000 on his transfer value...

News: Ombudsman watch.
February 21, 2005... A warm welcome... to those who are new readers of PW, courtesy of the National Association of Pension Funds (NAPF). To new readers, may I explain why this column is titled Ombudsman watch. It is because its ostensible purpose is to keep...

News: Teachers vote to strike over pension changes.
February 21, 2005... Teachers are considering strike action over proposed changes to their pension provision. The lecturers' and teachers' union NATFHE and the National Union of Teachers (NUT) have called for their members to strike, while the National...

NAPF Notice board.
February 21, 2005... New training programmes The NAPF's new, online Trustee Development Programme, launched in November 2004, has proven to be a big success. It is now being studied by its third group of students, with the total number of students who have...

Governance update: Assessing the independence of non-executive directors.
February 21, 2005... An area of corporate governance assessed by Research Recommen-dation Electronic Voting's (RREV's) research team is the independence of the non- executive directors (NEDs) sitting on a company's board. The revised or 'new' Combined Code...

Spotlight: The right tool for UK accounting standards?
February 21, 2005... First there was SSAP 24, the accounting standard for UK pension costs based on the belief that pensions are a long-term liability and that the cost of pension provision should be accounted for when it was incurred, producing a stable annual...

Opinion: Leader - Think long and hard about an investment strategy.
February 21, 2005... A few years ago, a portfolio weighted towards equities was the accepted wisdom for pension fund investment. Now, after the bear market of the last few years and with the increasing maturity of scheme liabilities, pension funds have tended to...

Opinion: Personal view - Do fund managers need coaching?
February 21, 2005... Fund managers are not robots. Like people in any other profession, their characters differ wildly - the difference is that they are judged solely on numbers. The point is that managers' personalities have a big impact on their portfolios'...

Opinion: Inside view - Inflation protected bonds deserve a closer look.
February 21, 2005... Mention inflation protected bonds and you're almost guaranteed to see eyes glaze over. Pension fund trustees, finance directors, consultants, investment managers and even actuaries find little to set their blood racing in this underrated asset...

Special Focus: Multi-manager - Intro.
February 21, 2005... The domain of the multi-manager is no longer within small pension schemes alone; larger funds are now seeing the benefit of employing the manager-of- manager approach. This special focus examines how multi-managers have raised their...

Special Focus: Multi-manager - The cost of the man in the middle.
February 21, 2005... Multi-manager is one of the fastest growing areas of pension fund management. Demand has been boosted by the move away from balanced mandates to specialist managers and a desire by trustees to outsource investment management and gain...

Special Focus: Multi-manager - Measuring up in multi-management.
February 21, 2005... The multi-manager provider has much to live up to. A hybrid combining the investment manager research and selection skills of a consultant in tandem with the discretion and accountability of an investment manager, the multi- manager needs to...

Special Focus: Multi-manager - The right approach.
February 21, 2005... The manager-of-managers (MoM) approach is now well established in the UK and is reaching that stage of growth where the challenges change from those based on a suspicion of anything new to: "does it work?" and "results aren't perfect - was it...

Special Focus: Company Profile - Northern Trust.
February 21, 2005... Background Northern Trust Global Investments (NTGI) is the asset management subsidiary of the Northern Trust Corporation, an AA-rated Chicago based financial services company and a leading provider of investment management, global custody,...