Pensions Week articles from July 2004

Pensions Week archives from July 2004

News: Valuations could force LGPS contribution hike.
July 5, 2004... Local government workers may, for the first time, see an increase in employee pension contributions if the latest triennial valuation results show huge drops in scheme funding levels. Employee contributions in the local government sector...

News: Four funds go global in governance with Hermes.
July 5, 2004... Four of the UK's biggest pension funds have adopted a global approach to their corporate governance - a move that led to asset manager Hermes gaining another coup on top of its deal with the British Coal fund last week. The GBP4.8bn West...

News: Group 4 reviews its investments.
July 5, 2004... The Group 4 pension scheme is conducting a review of its investment structure. Group 4, which provides manpower and technology-based security services, said the review was part of a regular fund review exercise. It remained tight- lipped...

News: Gissings outsources pension admin to Liberata for oe100m.
July 5, 2004... Gissings has outsourced its pensions and flexible benefits administration to business process provider Liberata, in a deal worth GBP100m over 15 years. The partnership will see Liberata take over complete responsibility for the back office...

News: Isis, F&C merge and become fourth largest UK asset manager.
July 5, 2004... Fund managers Isis Asset Management and F&C Management have merged to create the UK's fourth largest asset manager. Friends Provident, which owns 67% of Isis, will be a 51% majority shareholder of the enlarged group. F&C is currently a...

News: With-profit funds get asset boost to prove their strength.
July 5, 2004... Life insurance companies will be able to use a greater range of assets to prove the strength of their with-profit funds under tighter solvency tests. The Financial Services Authority (FSA) last week confirmed that among the main changes to...

News: British Coal appoints Hermes for unified investor voice.
July 5, 2004... The search for a unified voice on corporate governance issues, following the departure by Goldman Sachs Asset Management from the British Coal Staff Superannuation Scheme (BCSSS), was the main springboard leading to the appointment of a...

News: Report shows gaps in shareholder activism.
July 5, 2004... A number of gaps in shareholder activism by pension funds have been revealed. An interim report by the Local Authority Pension Fund Forum (LAPFF) showed pension funds rely heavily on fund managers to achieve best practice of shareholder...

News: Johnson replaces Gray as finance director at Railpen.
July 5, 2004... The Railways Pension Trustee Company, one of the UK's biggest pension funds, has appointed a new finance director to replace Malcolm Gray, who will retire later this year. Frank Johnson joins from South Eastern Trains Holdings, a...

News: MNPA's imaging process up to scratch.
July 5, 2004... Third-party administrator MNPA has achieved compliance with a code of practice run by the British Standards Institution - known as PD 0008 - for information stored electronically. The certification demonstrates that MNPA's processes and...

News: Lost pensions figure underestimated.
July 5, 2004... The government's estimate that 65,000 people have lost part, or all, of their pension benefits due to company insolvency has come under fire by experts, who claim the figure has been underestimated by thousands. Ros Altmann, the governor...

News: DB closures reach new phase in move to cut pension costs.
July 5, 2004... Companies are increasingly closing down defined benefit (DB) plans to existing employees because closure to new entrants is failing to cut pension costs. The trend to close DB schemes to new joiners is well established, but research has...

News: SWIP to run oe40m bond portfolio for Scott Enterprise.
July 5, 2004... Scottish Enterprise Pension & Life Assurance Scheme has appointed Scottish Widows Investment Partnership (SWIP) to manage a GBP40m bond portfolio as a result of the previous manager's decision to pull out from running the mandate. The...

News: Letters - Multi-employer schemes.
July 5, 2004... I am pleased to read Alan Culverhouse's letter in the latest edition of Pensions Week (21.06.04). My own organisation has been successfully running multi-employer schemes since April 1946. A major part of the deliberations of the NAPF...

News: Letters - Recycle and save lives.
July 5, 2004... It occurred to me recently that many of your readers will have an old mobile phone or printer cartridge tucked away in a drawer at home or at work. What they may not realise is that their unwanted items can benefit the Roy Castle Lung Cancer...

News: Law demands AVC changes.
July 5, 2004... Pension fund trustees who offer additional voluntary contribution (AVC) products without the open market option may find themselves breaking the law when the new Finance Bill is introduced. The Bill suggests that all money purchase schemes...

News: Pilkington officer joins Hewitt.
July 5, 2004... Consultant Hewitt Bacon & Woodrow has boosted its investment team with two senior appointments - a former chief investment officer of the Pilkington Superannuation Scheme and a managing director from Citigroup. Jeff McMahon, who joins from...

News: Personal pensions leads list of complaints.
July 5, 2004... Personal pensions continue to form one of the largest areas of complaints to the Financial Ombudsman Service. Personal pensions accounted for 7% of the complaints received by the ombudsman - although the figure fell by a quarter this year....

News: Revenue trust-busting costs Scot Am oe12,000.
July 5, 2004... Inland Revenue changes in the tax law to end 'trust-busting' were partly blamed for a delay in scheme administration that led to a GBP12,000 shortfall in a member's pension. Scottish Amicable, now the Prudential Assurance Company, has been...

News: Oxford provost to review actuary profession.
July 5, 2004... Actuarial standards and the self-governing profession's disciplinary regime will be scrutinised by Sir Derek Morris, the Oxford University provost who has been appointed to carry out a review of the profession. The role of of the appointed...

News: Occupational schemes will still be an option.
July 5, 2004... Many large employers will still try to provide occupational schemes after pensions simplification laws come into force, according to Tina Clayton, head of group pensions at mobile phone company 02. Her comments came after Bruce Moss, a...

News: Standard Life gives strong performance.
July 5, 2004... UK institutional business at Standard Life Investments is up over 22% year- on-year, according to its interim results last week. Corporate pensions generated GBP613m and the manager now runs over GBP1bn for UK local authority pension fund...

News: Left Field - Applying for assistance.
July 5, 2004... I doubt whether this will be last time that I write on the plight of those pensioners who have lost a very large part of their pension entitlement because their scheme has been wound-up with inadequate resources. Under pressure, the government...

News: Introducing the real head of Japan equities at BAM.
July 5, 2004... Baring Asset Management's head of Japan equities is Joji Maki, not Natasha Chetwynd as mentioned in Japan equities show promise, says BAM (PW last week). Ms Chetwynd is head of Japan equities at Britannic Asset Management. PW is happy...

News: FSA will not charge higher fees to pay off oe67m pension deficit.
July 5, 2004... The Financial Services Authority (FSA) said it would refrain from charging higher fees to regulated companies to pay off the deficit in its final salary pension fund and will instead absorb the shortfall over many years. A pension...

News: Investors seek exposure to alternative strategies.
July 5, 2004... More than 70% of institutional investors are looking to appoint fund-of- hedge-fund managers in order to gain exposure to alternative investments, according to a poll by Mellon Global Investments. This informal poll was carried out at...

News: Opas urges rise in standards as complaints soar.
July 5, 2004... Opas, the Pensions Advisory Service that handles complaints from scheme members against their retirement funds, said last week that it is concerned about falling levels of customer satisfaction after another leap in complaints. The number...

News: Ombudsman watch.
July 5, 2004... Sabbatical I have decided to award myself a short summer sabbatical. This means you will be spared my musings on the subject of matters related, or otherwise, to pensions for the rest of July. Instead my colleagues, James and Jo, will...

News: Specialist investment key to retaining market share.
July 5, 2004... The move away from balanced management is slowly eroding the market share of some of the largest and best-known brand names in UK fund management. Merrill Lynch, the large US bank which owns one of the biggest asset management companies in...

News: Isis adds Cable & Wireless, Colt to its stock portfolio.
July 5, 2004... Isis Asset Management has been buying telecom companies Cable & Wireless and Colt Telecom recently, along with insurance companies Prudential and Legal & General due to good valuations, which the fund manager said had been the key driver behind...

News: Two oe100,000 Sipps for Butterfield Private Bank.
July 5, 2004... Butterfield Private Bank has launched two self-invested personal pensions (Sipps) aimed at sums of GBP100,000 or more. Butterfield will offer the Sipps through pensioneer trustee firms DA Phillips & Co and Hornbuckle Mitchell Trustees, who...

News: State Street Global Advisors has 85% boost in UK assets.
July 5, 2004... The UK assets under management at State Street Global Advisors (SSGA) have grown by 85% during the past year, the company said last week. Increasing demand for its active and enhanced investment strategies drove the boost in funds, the...

News: Europe vs US in ETF arena.
July 5, 2004... Europe's exchange traded funds market (ETF) continues to grow faster than the US market according to a new Morgan Stanley study. According to its global summary report, as of the end of May, Europe has seen overall ETF assets under...

Spotlight: The emergence of a stronger asset class.
July 5, 2004... 1998. Probably the most significant year in the history of emerging market debt. Definitely the year that everyone remembers - Russian debt fell 80% and investors couldn't get out of the asset class quick enough. It put a quasi- generation of...

Governance watch: New research exposes disparity in top salaries.
July 5, 2004... The chief executives of the UK's biggest companies are paid far more in proportion to the salaries of other executives compared with smaller companies, analysis of Manifest's pay data published in association with pay consultant Independent...

Opinion: Leader - Who could possibly think that pensions are boring?
July 5, 2004... At the risk of sounding like an accountant from a Monty Python sketch, it is surely the case that pensions are not boring. Consider the latest evidence - rail workers threatening to strike over their pensions, a pension scheme deficit being...

Opinion: Personal view - Central bankers behind the curve.
July 5, 2004... Central banking is an art not a science. Judging the appropriate level for interest rates requires policymakers to anticipate an economy's future trajectory based on the available historical statistics, which, as we know, can be both inaccurate...

Opinion: Inside view - Building a better mousetrap for defined benefit plans.
July 5, 2004... Final salary or defined benefit plans need to adapt to survive. The changes that will be required need fundamental changes in the current relationship between pension funds, asset managers and consultants. Today it is conventional to start with...

Special Focus: Corporate Governance - Contents.
July 5, 2004... Socially responsible investing (SRI) is increasingly become a mainstream and not a niche activity for fund managers. From the ethical exclusion funds favoured by the fastidious, SRI now means looking at how companies operate in wider worlds of...

Special Focus: Corporate Governance - SRI - still struggling to attract attention?
July 5, 2004... If you go back to 1997, New Labour was big on 'big ideas'. One of these big ideas was for an overhaul of the whole pension industry - low cost stakeholder pensions (available apparently over the counter at Tesco) and also there was a lot of...

Special Focus: Corporate Governance - Corporate governance peaks investor interest.
July 5, 2004... Corporate governance has rarely been the focus of such intense investor interest as has been the case in recent months. Interest from institutional investors in particular has surged as they become more aware of both its implications for share...

People on the move: Harries to manage institutional and private funds at Veritas.
July 5, 2004... A former fund manager of Newton Investment Management, James Harries, has left the firm to join Veritas Asset Management UK, a subsidiary of the Real Return Holdings Company. Harries will be managing a range of institutional and private...

People on the move: Patterson leads UBS pooled property fund.
July 5, 2004... UBS Global Asset Management has appointed the former property sector analyst from HSBC, Alan Patterson, to head up its pooled property fund business. Patterson has been appointed as director of pooled property funds. His appointment...

People on the move: Adams joins ABN AMRO Mellon as head of European sales division.
July 5, 2004... The former managing director of The WM Company, Peter Adams, has joined ABN AMRO Mellon to head up its European sales division. In his new position with ABN AMRO Mellon, Adams will report to Paulo Sousa, chief commercial officer. ...

People on the move: Waters goes from Invesco to Morley.
July 5, 2004... Morley Fund Management has recruited Paul Waters as head of client investment services for the institutional team. He joins from Invesco where he was a client service director for the past three years. Prior to this, he was head of...

People on the move: Lazenby to be sales director at Wesleyan.
July 5, 2004... The former UK sales manager at Standard Life, Ian Lazenby, has been recruited by Wesleyan Assurance Society as its new director of sales. The position of director of sales became available following Craig Errington's promotion to managing...

News Just In... : Fewer equities, more bonds for funds.
July 5, 2004... Pension funds still hold too many equities and the only solution is to continue selling them, said three top actuaries last week. By 2010 UK pension funds will hold more bonds than equities and the main driver of this shift is the...

News Just In... : Easing of solvency standards would be a cold comfort for policyholders, say actuaries.
July 5, 2004... Calls for the financial regulator to water down insurance company solvency standards when markets get tough is dangerous, even though it has been seen to work, said three leading actuaries last week. The three actuaries also said it would...

News: UK pressured to extend tax laws.
July 12, 2004... The European Commission is to put pressure on the UK to extend its tax laws to cover pension contributions to funds offered by European providers outside the country. This would mean that contributions made by people in the UK to funds...

News: Manfacturers to back pensions protection fund - but only if members bear the cost.
July 12, 2004... Many manufacturing companies are set to signal their support for the pensions protection fund (PPF) today - if they can claim levies back from scheme members. A survey will also reveal considerable confusion among employers about how the...

News: Tonge joins Opas after Maersk fight.
July 12, 2004... Mark Tonge, a former director for trades at UK-based Sea-Land who took action against Danish shipping group Maersk after it tried to walk away from its pension fund, has become a voluntary adviser at the Pensions Advisory Service (Opas), the...

News: Recently retired pensioners may have to survive on oe96 a week.
July 12, 2004... The average income from an occupational pension fund among recently retired pensioners is GBP96 per week. This represents 27% of the average GBP356 total gross income for single pensioners and couples, according to UBS Global Asset...

News: Northern Trust expands to include UK fund accounting.
July 12, 2004... Northern Trust, a global custodian, has entered the UK fund accounting business in a bid to compete more closely with major custodians such as State Street Bank and ABN AMRO Mellon. Northern Trust said the expansion compliments its growth...

News: Cambridgeshire injects 10% into property mandate.
July 12, 2004... The Cambridgeshire County Council pension fund has allocated GBP85m to the Schroders property fund of funds. The move follows the investment panel's decision to increase property allocation from 6% to 10% of the total pension fund, which is...

News: Cambridge University fails examination over pension hike.
July 12, 2004... The University of Cambridge has come under fire after it increased employee contributions from 1% to 6% for members of its Assistant Staff Pension Scheme. The university said it was forced to push up the contribution level to that extent...

News: PMI members believe trustees to be clueless.
July 12, 2004... Very few trustees had any idea about what they were letting themselves in for when they became trustees, a survey indicates. The Pensions Management Institute (PMI) survey found that as well as this, more needs to be done to ensure trustees...

News: Contracting out comes up short.
July 12, 2004... The government has chipped away at rebates making contracting out of the state second pension increasingly the wrong option for pension schemes, it was said last week. National Insurance rebates are often worth far less than the state...

News: Interest rate increase fails to boost annuities.
July 12, 2004... Retirees hoping to increase their income by postponing annuity purchase may be disappointed, a leading independent financial adviser said last week. Annuity rates have been increasing recently and Chartwell Investment Management said it...

News: Increase in alternative investment allocation by pension funds.
July 12, 2004... Pension funds increased their allocations to alternative investments last year with property and private equity among the major attractions. A global ranking survey - Alternatives 99 - by consultant Watson Wyatt looked at the world's...

News: Weir Group awards GSAM oe85m mandate.
July 12, 2004... The Weir Group pension scheme is to invest a fixed income mandate targeting assets including securities backed by mortgages. The pension scheme has awarded Goldman Sachs Asset Management (GSAM) the GBP85m UK mandate. As an active alpha...

News: Pointon York joins forces with Jackson-Stops to provide property opportunities for IFAs.
July 12, 2004... Pointon York Sipp Solutions, a leading provider of self-invested personal pensions, has teamed up with estate agent Jackson-Stops and Staff to provide property opportunities for independent financial advisers (IFAs). To be eligible to...

News: Schemes should conduct own tender, says LCP.
July 12, 2004... Pension funds can save between GBP12,000 to GBP40,000 on fees if they carry out a tender themselves. Pension advisers Lane Clark & Peacock (LCP) said pension schemes are increasingly carrying out actuarial/consultant and third-party...

News: FSA reviews projections practices within a wide range of investment products.
July 12, 2004... The Financial Services Authority (FSA) has started a fundamental review of projections - the way retail firms give their customers information about the potential future returns and charges from a wide range of investment products. The...

News: Pressure mounts on trustees to demand better admin service.
July 12, 2004... Pressure last week mounted on trustees to demand improvements from pension scheme administrators in order to turn around the poor records of satisfaction found amongst employees who deal with their schemes. Mark Adamson, managing director...

News: FTSE 350 pension deficits drop by oe10bn.
July 12, 2004... Pension deficits in FTSE 350 companies fell from GBP74bn to GBP64bn over 2003. Despite a rise in equity markets, pension scheme deficits in FTSE 350 companies improved only slightly over 2003, according to research by Mercer Human Resource...

News: Commission recapture programmes being used to abide by FSA rules.
July 12, 2004... Pension funds and fund managers are increasingly using commission recapture programmes to show that they are controlling trading costs, research shows. BNY Securities Group says commission recapture is helping fund managers and schemes...

News: Myners to investigate governance of life offices.
July 12, 2004... Paul Myners has launched a consultation into the governance of mutual life offices following the report into the Equitable Life affair led by Lord Penrose. Myners will explore some of the wider issues arising from the Equitable report such...

News: Brown elected president.
July 12, 2004... The Faculty of Actuaries has elected Harvie Brown, a worldwide partner of Mercer Human Resource Consulting, as its new president for the next two years.

News: M&S case highlights trustee responsibilities.
July 12, 2004... Pension fund trustees face difficult decisions in balancing the interests of different groups of members when considering how to deal with takeovers of their sponsoring employer, following the recent takeover attempts at WH Smith and Marks &...

News: MNPA completes client migration to UPM.
July 12, 2004... Pensions administrator MNPA has completed the migration of all its clients onto Comino's process-based administration system, UPM. Last month two career average salary Merchant Navy funds covering around 85,000 members went live on the system....

News: Insider - A united front.
July 12, 2004... If the trustees representing the pension funds of the world were to get together do you think that they would be able to agree on an action plan that would benefit all their funds and yet was still fair to all the other stakeholders in the...

News: CBI urges employer contributions.
July 12, 2004... All companies that can afford to make contributions to their pension scheme should do and they should also ensure that trustees are "adequately equipped" to take on their responsibilities, the Confederation of British Industry (CBI) has said....

News: UK's retained firefighters lose pensions fight.
July 12, 2004... Retained firefighters, who only work when their services are required, have lost their appeal to be part of the Firefighters Pension Scheme. The workers claimed that they were treated less favourably than full-time firefighters because...

News: Ombudsman watch.
July 12, 2004... Age Discrimination While we concern ourselves about the Pensions Bill and the soon to be Finance Act, the potential for a real revolution in the world of pensions and employment is coming up in the outside lane. The government clearly...

News: UK member premiums dwarf their European counterparts.
July 12, 2004... UK occupational scheme members and life product customers paid in far greater premiums to their savings than their European counterparts last year, research has found. The total figure for 2003 UK premiums equals 30% of the amount for the...

News: Exchange traded funds have increased appeal.
July 12, 2004... The number of investors using exchange traded funds (ETFs) has increased, according to a leading bank. Institutional investors who report holding one or more US-listed ETF has grown by 6% during the past year, according to analysts at...

News: Martin Currie hits milestone as sales continue to grow.
July 12, 2004... Gross sales this year at Martin Currie, the self-styled 'big boutique' fund manager based in Edinburgh, passed the GBP2bn mark last week. The firm said this was well ahead of target, with three months to go before the company's year-end,...

News: Fund manager rewards face axe as industry seeks stability.
July 12, 2004... Fund managers will have to accept lower rewards if the industry is to reach more stable ground following the bear market, acccording to the findings of a study. However, in order to achieve this, a huge shift in mindset is necessary within...

News: Hymans Robertson relocates to prime Glasgow property.
July 12, 2004... Consultant Hymans Robertson's Glasgow office has relocated to Central Exchange, CALA Properties' prime city location. Hymans is the first tenant in the GBP30m seven-storey building, of which it will lease two floors. Hymans said the...

Spotlight: Look out! It's ahead of you.
July 12, 2004... The problem of making pensions exciting, or even palatable, is an old one for many large corporations. However, few have bucked the trend of releasing information through standard, and some would argue, ineffective internal communication...

Governance Watch: Directors' payoffs still under the spotlight.
July 12, 2004... The revised Combined Code states that the remuneration committee should carefully consider what compensation commitments its directors' terms of appointment would entail in the event of early termination, and rewarding poor performance should...

Opinion: Leader - A laudable attempt, now try again.
July 12, 2004... While the government's desire to protect pension schemes from the unscrupulous is laudable, recent events show that the law of unintended consequences is in danger of being applied with a vengeance. For example, the Pension Bill contained a...

Opinion: Policy view - The phasing out of contracting-out.
July 12, 2004... Contracting-out is one of the most complicated parts of probably the most complicated pension system in the world. Contracting-out is becoming less common, particularly in defined benefit schemes, and insurers are advising people to contract...

Opinion: Inside view - Ready or not, here comes the new tax regime.
July 12, 2004... The Finance Bill published on 8 April 2004 confirmed that the new tax regime will be implemented from 6 April 2006. The excitement created by its publication has been entirely underwhelming, perhaps due to the arcane nature of the material, the...