Pensions Week articles from January 2003

Pensions Week archives from January 2003

News: Railpen in major staff shake-up.(Brendan Reville)(Brief Article)
January 13, 2003... The GBP12bn Railpen scheme has recruited Brendan Reville, formerly investment director at consultancy Gissings, as part of a major internal re-structuring of its investment team. Reville joined the firm last week as head of investment...

News: Bowie attacks diluted and fearful green paper plans.(Institute of Actuaries)
January 13, 2003... The green paper's radicalness was diluted because of the government's fear of creating too many losers in a new private pensions system, Ronnie Bowie, chairman of the Institute of Actuaries' pensions board, said last week. The related and...

News: Steel workers and government in battle for top defence barrister.(ASW)
January 13, 2003... Campaigners taking court action over lost benefits at steel company ASW are scrambling to appoint the government's preferred pensions barrister in a bid to damage the Department for Work and Pensions' (DWP) defence. The ISTC steelworkers...

News: Bush re-election push to boost US equities.(Brief Article)
January 13, 2003... This year's outlook for US equities is boosted by George W Bush's hopes for re-election, believes veteran investment strategist Jeremy Grantham, chairman of fund manager Grantham, Mayo, Van Otterloo & Co (GMO). Grantham said the fact that...

News: Credit warning over wind-ups.
January 13, 2003... Companies have warned that changes to the priority order in scheme wind-ups could hit their ability to raise funds. During a Pensions Week roundtable, it was agreed that raising the priority of members as creditors, when a sponsoring...

News: Property offers the best returns as funds have worst year since 1974.(Brief Article)
January 13, 2003... UK pension funds are not deserting equities despite the poor per-formance of last year's market and greater bond investment. However, they continue to exit the country by spreading their portfolios globally. Disinvestment in UK...

News: State Street wins Tate & Lyle global custody mandate.(Brief Article)
January 13, 2003... The GBP600m Tate & Lyle Group pension scheme has appointed State Street Corporation to provide custodial and administration services. State Street will provide global custody and investment accounting services to the UK-based occupational...

News: Wincanton and T&G square up over final salary closure.(Brief Article)
January 13, 2003... A storm is brewing between distribution company Wincanton and the Transport and General Workers' Union (T&G) over the closure of the company's final salary scheme to new entrants. Ron Webb, national secretary for transport at the T&G, said...

News: Opra's Jones receives OBE in honours list.(Mike Jones)(Brief Article)
January 13, 2003... Mike Jones, a board member of the Occupational Pensions Regulatory Authority (Opra), has been given an OBE in the New Year's honours list. Jones, who is also an associate at Hewitt Bacon & Woodrow where he acts as actuary to the...

News: Equitable squares up to auditor in oe2.6bn court battle.(Equitable Life's case against Ernst & Young )(Brief Article)
January 13, 2003... Equitable Life begins its GBP2.6bn court battle with its former auditor Ernst & Young (E&Y) today (Monday). The former auditor denies the claim that the accountant should not have signed off the insurer's accounts, which Equitable alleges...

News: Markets hope for short Gulf war.(Brief Article)
January 13, 2003... Schroder Economics is predicting an 80% probability of war with Iraq this year, with a short and successful strike by the US and its allies the most likely outcome. The latest analysis by Schroders says the massive military build-up and...

News: Opra to assume wider investigative role.(Occupational Pensions Regulatory Authority)(Brief Article)
January 13, 2003... Pensions schemes posing a high risk to members' benefits will be investigated by the pensions regulator under radical changes put forward in a review. The five-year review of the Occupational Pensions Regulatory Authority (Opra) was...

News: MLIM sells Strand Island amid fears for market.(Merrill Lynch Investment Managers sells office block)(Brief Article)
January 13, 2003... Merrill Lynch Property Fund has sold its largest asset - a London office block - for GBP66m as concerns of cental London offices continue. The Strand Island office block was sold to clients of property consultant Baring, Houston & Saunders....

News: Aberdeen survey shows property investment set to rise.(Aberdeen Property Investors survey)(Brief Article)
January 13, 2003... Pension fund investment in property in set to rise to 10% by 2005, according to a property fund manager. In a survey by Aberdeen Property Investors (API), 85% of funds said performance and diversification was the key attraction to property...

News: Lapff's strive for independence sees Pirc lose admin function.(Local Authority Pension Fund Forum restructures administration and management )
January 13, 2003... The Local Authority Pension Fund Forum (LAPFF) - a major shareholder activist group - is restructuring its management and administration in a move that will see all secretarial functions removed from corporate governance firm, Pensions...

News: oe55m Lothian mandate goes out to tender.(Lothian pension fund)(Brief Article)
January 13, 2003... The GBP2bn Lothian pension fund, administered by Edinburgh council, has gone out to tender for an emerging markets mandate. The GBP55m mandate was put under review after the current fund manager's, Lloyd George Investments, contract came to...

News: FSA proposes new savings regime based on Sandler recommendations.(Financial Services Authority )(Brief Article)
January 13, 2003... The financial regulator has set out three options for introducing lighter- touch regulation for selling savings and investment products. As recommended by Ron Sandler in his review of long-term savings, the products would have...

News: Scottish Widows starts the year with a boom.(new contracts)(Brief Article)
January 13, 2003... Third-party administrator Scottish Widows has bagged a string of contracts to provide pensions administration, actuarial, and consulting services. It has been appointed by Surestock Limited, SM2002, Scottish Sea Farm, Silentnight No2...

News: HS and Wentworth team up for more pension fund clients.(HS Administrative Services reaches deal with Wentworth Rose )(Brief Article)
January 13, 2003... Third-party provider HS Administrative Services (HS) is seeking to win over more pension fund clients through a recent deal with independent financial advice firm Wentworth Rose. The agreement was primarily driven by HS's need to replace...

News: Left field - Read between the lines.
January 13, 2003... By far and away the most important response to the green paper was not from the experts, the industry and the like. It was from the chancellor himself. Tucked away in a news report in the Financial Times is the most significant briefing I...

News: Savings gap and insurers hit by new tax initiative.(Brief Article)
January 13, 2003... An unwelcome Christmas present to the life and pensions sector could dent any chance of closing the savings gap, experts warned last week. Last month, the government sneaked out changes to the taxation of shareholder-owned life insurers,...

News: Old Bailey hands AGCO oe37m bill.
January 13, 2003... A company has been left with a GBP37m pensions liability after scheme members of the Massey Ferguson fund won the right to retain full pensions after redundancy. The employer, AGCO, argued that members it made redundant who were old enough...

News: Govt to review FSA role merger.(Brief Article)
January 13, 2003... The roles of chairman and chief executive at the Financial Services Authority (FSA) may be split when Sir Howard Davies' successor is appointed. In a debate at the House of Lords, deputy chief whip Lord McIntosh of Haringey, said the...

News: Ombudsman Watch.
January 13, 2003... What about ill-health? As readers may be aware, I believe in the use of plain English. Clarity and simplicity are the watchwords - particularly when it comes to member communication. All too often tortuously drafted long sentences in...

News: BAM warns of profit slide.(Brief Article)
January 13, 2003... Britannic Asset Management (BAM) warned of lower profits as its parent - insurance company Britannic Assurance - warned shareholders that they may not see dividends and told policyholders they were unlikely to see annual bonuses. Britannic...

News: Barings' bullish predictions forecast 8% equity rise.(Brief Article)
January 13, 2003... Baring Asset Management predicts an 8% return from global equities this year. A number of fund managers have called the market wrong in the past two years, but despite more cautious forecasts from other quarters for 2003, Barings is...

News: Merrill Lynch grabs gold in unit trust performance.(Brief Article)
January 13, 2003... Merrill Lynch Investment Managers' (MLIM) gold fund - the Merrill Lynch Gold & General Fund - is the UK's top performing unit trust over the past 12 months. The fund rose 78.1% between December 2001 and December 2002, beating the FTSE Gold...

News: Client wins put Capital in the limelight.
January 13, 2003... Low profile fund manager Capital International enters the year with around GBP15.8bn under management in the UK having proved to be one of the most successful firms in 2002 with a string of new wins. The manager, which shuns publicity,...

News: UK investors suffer as Euro private equity funds slump.(Brief Article)
January 13, 2003... The UK makes up over three-quarters of the European private equity market, which last year saw funds fall by almost 30% from 2001. The value of funds raised by European private equity firms in 2002 fell 28% to GBP17.8bn. UK-based funds...

News: F&C on target for sharp earnings increase.(Brief Article)
January 13, 2003... F&C Management said it was on track to achieve a sharp increase in operating earnings after getting its cost base down by 15%. Pre-tax profits before exceptional items will rise by 20% to E47m, said the firm. The fall in costs will in...

News: Commission lacks state pension punch.
January 13, 2003... The government's compulsion committee, set up last month by secretary of state Andrew Smith, will not examine the state pensions system as part of its terms of reference, it has emerged. There were questions about the group's exact role...

News: Govt green paper tackles compulsion.(Brief Article)
January 13, 2003... Along with a commission to investigate the issues surrounding compulsion, the pensions green paper also accepted Ron Sandler's recommendations to simplify savings. For occupational pensions, the paper accepted the main recommendations of...

News: Pearson polls members' views.(Geof Pearson)(Brief Article)
January 13, 2003... Geof Pearson, the pensions manager at J Sainsbury, has called for his scheme members' views about the green paper and Inland Revenue proposals. He intends to feed them through to government along with his own. Pearson said: "My own...

News: Inaugural meeting of Tory pension group.
January 13, 2003... A Conservative Party-sponsored pensions and investments advisory group, that says it will raise issues with the government that concern the industry, is to meet for the first time on Tuesday (14.01.03). The advisory group will be open to...

Spotlight: Coming out of the sand.
January 13, 2003... So the government has "got it right" and its policies are "welcomed" and "radical"? No, not the green paper on pensions, that was roundly condemned as a "missed opportunity" and led to the government being accused of burying its head in the...

Governance Watch: Going the extra mile.(Brief Article)
January 13, 2003... Almost all pension fund trustees in 2000 addressed corporate social responsibility (CSR) when the government amended the 1995 Pensions Act to include regulations asking them to disclose to what extent, if at all, CSR issues were considered in...

Opinion: Leader - The taxman's taken all my woes.(Brief Article)
January 13, 2003... Few pension experts can have ever expected to find themselves in the position of praising the radicalism of the Inland Revenue, but the taxman's recent proposals on simplifying pensions taxation have done just that. The green paper itself...

Opinion: Investment View - There's no smoke without fire.(Shropshire County Council)
January 13, 2003... There has been a revival of the socially responsible investment (SRI) debate in recent weeks. The SRI industry apparently faces legal crisis as Shropshire County Council's GBP530m pension fund has been advised to reinclude tobacco stocks....

Opinion: Inside View - Give them credit, but get a move on.
January 13, 2003... Reaction to the pensions green paper among politicians, the media and pensions professionals was, at best, mixed and, at worst, downright hostile. Yet, of the acres of newsprint devoted to the subject in recent weeks, very little was critical...

Special Report: For the record.
January 13, 2003... The government has issued two consultation documents - a green paper, Simplicity, Security and Choice: working and saving for retirement and the Inland Revenue/HM Treasury proposal Simplifying the taxation of pensions: increasing choice and...

Special Report: Keeping an eye out for the trust busters.(Column)
January 13, 2003... Much has been written about the rise in the number of trust busting or pensions liberation schemes whereby bogus companies offer to convert members' pension funds into immediate tax free lump sums, thereby avoiding payment of tax. These...

People on the move: Clark takes advisory role at Mercers.(Gordon Clark joins Mercer Human Resource Consulting)(Brief Article)
January 13, 2003... Mercer Human Resource Consulting (MHRC) has appointed Gordon Clark as a European partner. Clark joins from financial services firm PricewaterhouseCoopers where he was a director for two years and most recently head of the investment...

People on the move: Heath faces challenging time to get the message across at AHC.(Karen Heath joins consulting firm AHC as communication project manager)(Brief Article)
January 13, 2003... Karen Heath, the former pensions and communication training manager at Bass Plc, has joined consulting firm AHC as a communication project manager. At Bass, now Six Continents, Heath was involved in all aspects of pensions communication...

People on the move: Abbott goes global in move to Merrill Lynch.(Peter Abbott joins global equity team of Merrill Lynch Investment Managers)(Brief Article)
January 13, 2003... A former director of Newton Investment Management has left the firm to join one of the largest fund managers in the UK. Peter Abbott has joined the global equity team at Merrill Lynch Investment Managers (MLIM) as a fund manager. In...

News Just In... : IBM pensioners seek backing from MPs.(Ministers of Parliament)
January 13, 2003... IBM pensioners have called on 60 MPs, urging them to use their powers to protect scheme members' funds. The Association of Members of IBM UK Pension Plans (AMIPP) said the current examination of pensions legislation gave the perfect...

News Just In... : Lonrho loses out in oe27m surplus battle.(GBpounds 27 million)
January 13, 2003... Trustees of the John Holt pension scheme have won the right to use a GBP27m scheme surplus to increase members' benefits. The case went to court after the sponsoring employer, Lonrho Africa Trade and Finance, argued that the trustees did...

Update: Employee benefits - DWP must add the personal touch to pensions promotion.(Department for Work & Pensions)
January 13, 2003... Employers need more help from government with promoting pensions in the workplace if there is to be an increase in the savings culture, benefit consultants say. Otherwise, the green paper proposals for advice packs in the work place will...

Update: Employee benefits - AVC and money purchase schemes to be given greater transparency.(additional voluntary contribution)(Brief Article)
January 13, 2003... Regardless of how plans for pension benefit statements pan out, from 6 April this year there will be a new requirement to provide statutory illustrations to money purchase and additional voluntary contribution (AVC) scheme members. These...

Update: Employee benefits - Getting the message across.(Column)
January 13, 2003... Hundreds of millions of pounds are spent on benefits by UK employers each year. Yet how much of this benefit provision is understood and appreciated by employees? Benefits have become a major focus for employers as they look for new ways...

News: Last hope for Maxwell victims.(Maxwell Communication Pension Plan)
January 20, 2003... The Department for Work and Pensions (DWP) is advising members of the Maxwell Communication Pension Plan (MCPP) to seek financial help from a little-known trust, from which they are not automatic entitled to help. The advice follows the...

News: Spread pension risks, says panel of experts.(Brief Article)
January 20, 2003... Pension fund risks should be pooled, according to the panel of experts at the Pensions Week green paper roundtable. The head of the National Association of Pension Funds (NAPF), Christine Farnish, spoke for panel members when she said:...

News: MP to present Bill for survivor benefits for umarried couples.(Brief Article)
January 20, 2003... An MP campaigning for survivor benefits in the public sector is to present a Bill this week that will attempt to extend the principles of the Civil Service scheme, which gave cover to unmarried partners without cost to the government. ...

News: FSAVC mis-selling review pays out oe250m.(free standing additional voluntary contributions )(Brief Article)
January 20, 2003... A quarter of a billion pounds will be paid out in compensation as a result of the free standing additional voluntary contributions (FSAVC) mis-selling investigation, the financial regulator said last week. The Financial Services Authority...

News: Personal pension providers unpopular.(Brief Article)
January 20, 2003... More than one in 10 personal pension holders are unhappy with their pension company and wish to transfer to another provider, according to a survey commissioned by Jupiter Unit Trust Managers. Dissatisfaction with respondents' current...

News: LGPS expands membership to councillors.(Local Government Pensions Scheme)
January 20, 2003... Career average pensions are to be introduced for non-executive councillors through the Local Government Pensions Scheme (LGPS) after lobbying from local authorities. Councils argued shortfalls in councillors' pensions savings, caused by...

News: LPFA to run oe450m Hackney fund.(London Pensions Fund Authority)(Brief Article)
January 20, 2003... The GBP450m London Borough of Hackney pension fund has outsourced its pensions administration, payroll, and some accounting services to the London Pensions Fund Authority (LPFA) as part of a cost cutting exercise. The services were...

News: DWP's scheme cost savings questioned by industry.(Department for Work and Pensions)(Brief Article)
January 20, 2003... Third-party administrators questioned the government's claim that employers' scheme administration costs could fall by millions of pounds a year as a result of the simplification exercise. The Department for Work and Pensions claims changes...

News: Government tables show stakeholder setback.(Brief Article)
January 20, 2003... Four companies have ceased selling stakeholder pensions according to tables released by the government last week. Two of the companies quit during the summer last year while Canada Life de- registered in December. Although Friends...

News: High Court to rule in E&Y claim case.(Brief Article)
January 20, 2003... Equitable Life's former auditing company went to court last week to try and prevent a GBP2.6bn claim against it from going ahead. In a four-day hearing, Ernst & Young (E&Y) told a High Court judge that it bore no responsibility for the...

News: SGAM faces the chop at Norfolk in mandate review.(Norfolk County Council pension fund)(Brief Article)
January 20, 2003... The GBP1bn Norfolk County Council pension fund has gone out to tender for a UK equities mandate. The GBP180m mandate is currently managed by SG Asset Management (SGAM) but is being reviewed because of performance concerns. Nicola Mark,...

News: Fair deal for Ove Arup early retiree.
January 20, 2003... The trustees of the Ove Arup pension fund have come under fire for maladministration by the ombudsman after they reduced the transferred-in benefits of a scheme member when he took early retirement. The member, Mr Fair, took his complaint...

News: Willetts launches scathing attack on Smith over unreliable pensions figures.(David Willetts)(Brief Article)
January 20, 2003... Secretary of state for work and pensions Andrew Smith admitted official figures about pensions saving could not be trusted. In a brutal encounter with MPs last Monday, Smith conceded that in light of the two sets of mis-calculations by the...

News: Gissings offers trustee training programme.(Brief Article)
January 20, 2003... Gissings, the firm of consultants, is to run an integrated series of courses aimed at trustees that will discuss issues relevant to defined benefit (DB) and defined contribution (DC) schemes. 'Building on Experience' is a course for...

News: Hoover doubles its contributions after actuarial valuation.(Hoover pension fund)(Brief Article)
January 20, 2003... The GBP376m Hoover pension fund has almost doubled its employer contribution rate following an actuarial valuation. Although it was over 100% funded, the scheme moved the contribution rate from 5.2% to 10%. As a result of the...

News: Richardson row escalates.
January 20, 2003... Workers at Belfast fertiliser company Richardson have appointed an insolvency solicitor which could lead to a court battle with ICI and the Irish government as they step up attempts to get their full pension rights. In an escalation of...

News: Revenue calls on industry to round off radical proposals.(Brief Article)
January 20, 2003... The Inland Revenue has called on the pensions industry to help supply the details for the radical new tax regime for pensions it announced last month. Speaking at a seminar last week, Peter Hopkins, leader of the simplification review...

News: Pirc reappointed at South Yorkshire.(Pensions Investment Research Consultants)(Brief Article)
January 20, 2003... The GBP2.6bn South Yorkshire Pensions Authority has re-appointed Pensions Investment Research Consultants (Pirc) to provide corporate governance and socially responsible investment services. John Hattersley, fund manager at South Yorkshire,...

News: Hamilton retakes helm at FSCS.(Financial Services Compensation Scheme)(Brief Article)
January 20, 2003... The Financial Services Authority (FSA) has re-appointed Nigel Hamilton as chairman of the board of the Financial Services Compensation Scheme (FSCS) for a further three-year term. Three other members of the FSCS board - Sarah Brown, Graeme...

News: Split on scandals' effect on FSA reputation.(Brief Article)
January 20, 2003... Providers and financial advisers are split over whether the problems with Equitable Life and the split cap sector have dented the financial regulator's reputation. In the latest PIMS survey, 50% of the panel of financial services...

News: Insider - Different perspectives.
January 20, 2003... Comments so far about the green paper - Simplicity, Security and Choice - remind me of an old Hindu legend about six blind men who came upon an elephant for the first time. One felt its legs and said that it was like a tree; one passed along...

News: JLT takes over from Mercers for Secro Metrolink DB scheme.(Jardine Lloyd Thompson)(Brief Article)
January 20, 2003... Employee benefits firm Jardine Lloyd Thompson (JLT) has replaced Mercer Human Resource Consulting to provide pensions services to the Secro Metrolink scheme. JLT will provide actuarial, consulting, investment advice, and administration...

News: LGIM seizes regulatory change to pick up oe100m.(Legal & General Investment Management)(Brief Article)
January 20, 2003... Legal & General Investment Management (LGIM), one of the major providers of index-tracking funds, has taken advantage of a little-known regulatory change to accept funds from overseas investors into its UK pooled life funds. So far it has...

News: TUC urges workers to take their Fair Shares.(Trades Union Congress)(Brief Article)
January 20, 2003... The TUC is urging trade unionists and employees to use shareholder power to force companies to implement more long-term, worker-friendly policies. It is to mount a Fair Shares conference on Monday 24 February which will urge greater use of...

News: The great DB pensions divide.(defined benefit closures)(Brief Article)
January 20, 2003... A lack of communal feeling between company directors and staff is the cause of many defined benefit (DB) closures, MPs were told last week. A senior pensions expert said the earnings cap had driven a wedge between the two camps, forcing...

News: Ombudsman Watch.
January 20, 2003... Overstatement The ombudsman has not yet published any 2003 determinations. So I review two contrasting late December 2002 defined contribution (DC) determinations, reflecting the seismic swing from surplus to deficit experienced over the...

News: Bear market equity slump here to stay.
January 20, 2003... Investment bank Merrill Lynch has predicted that the equity bear market will continue in 2003, with economic growth and corporate earnings surprising on the downside, and the European Central Bank (ECB) cutting rates more than is currently...

News: MAM's the word for former Merrills fund managers.(Brief Article)
January 20, 2003... Six Former Merrill Lynch Investment Managers (MLIM) staffers launched their own fund house last week called Majedie Asset Management (MAM). MAM is a specialist fund management company that focuses on the management of UK equities for...

News: Pension funds back to 1997 mark.
January 20, 2003... Global pension savings shrank back to 1997 levels last year as the bear market dragged relentlessly on. In 2002, total institutional pension fund assets of the 11 major markets fell by approximately US$1,400bn - or 12% - according to...

News: Charities not interested in corporate governance.(Brief Article)
January 20, 2003... Many UK charities believe a number of the principles laid down by the Paul Myners review of institutional fund management are also applicable to charities with investment portfolios - except issues of corporate governance. Research by The...

News: Triple-A funds seen as safety net from falling markets.(Brief Article)
January 20, 2003... Triple-A rated money market funds sales have dramatically increased, as investors seek safety from the bear market. However, sterling funds decreased by 4.9%, dollar funds 19.7% and euro funds grew 21.2% in the last quarter, according to...

Spotlight: No place like home.
January 20, 2003... Pension funds are increasing their exposure to property as the downturn in the equity market continues. Many schemes are looking at property for the first time and those that have already invested in property are increasing their portfolio...

Governance Watch: Preparing for the peak season.(Brief Article)
January 20, 2003... The AGM register that appears in governance watch each week provides a flavour of the service that we provide clients. In the corporate governance section, issues are identified that correspond to the voting guidelines we have developed since...

Opinion: Leader - Ever decreasing circles.
January 20, 2003... With the creation of a pensions commission to review whether or not voluntary private pensions and long-term savings are sufficient, the debate over pensions compulsion is likely to become even more significant over the next few years. ...

Opinion: Investment View - European portfolio construction.
January 20, 2003... Despite the creation of the single European market in the early 1990s and the introduction of the euro to the financial markets in January 1999, it is still relevant when constructing lower risk European equity portfolios to be aware of both...