Pensions Week articles from July 2008

Pensions Week archives from July 2008

News: HMRC refuses to extend VAT exemption to all.
July 7, 2008... Byline: Charlie Thomas Schemes in wind-up are to continue suffering from unfair taxation rules, despite a landmark ruling. Earlier this year, Capital Cranfield, independent trustee of the Kenrick and Jefferson scheme, won a VAT...

News: Hammersmith ups allocation with Majedie.
July 7, 2008... Byline: David Ricketts The London Borough of Hammersmith and Fulham Pension Fund is to place a quarter of its GBP4.5bn fund in active UK equities with Majedie Asset Management. The boutique manager is seeing its stake of the fund...

This week: Our father who art...
July 7, 2008... Byline: David Rowley - Editor, Pensions Week For as long as most of us can remember, Gordon Brown has been identified as the most influential and powerful person in pensions. Rather like the shocking moment in Sleeping Beauty when the...

News: Debt rise set to trigger fund contribution fall.
July 7, 2008... Byline: David Rowley Rising mortgage costs are predicted to force many employees to lower their pension contributions over the next six months. The predictions from administrators and a leading IFA follow data from the Office for...

News: Private pensions see a 10% drop in active membership.
July 7, 2008... Byline: David Rowley There has been an approximate 400,000 fall in active members of private sector pension schemes over the last year, according to the Office for National Statistics (ONS). In its Occupational Pension Scheme Survey...

News: Widows hit by over 20 claims of mis-selling.
July 7, 2008... Byline: David Rowley The number of schemes seeking compensation against Scottish Widows for alleged mis-selling of funds has grown to over 20, following publicity for the original claim. All the schemes that have come forward claim to...

News: Bonds favoured by 46% of managers.
July 7, 2008... Byline: David Rowley Nearly half of pension scheme managers have undertaken an investment shift from equities to bonds during the past 12 months, according to research by Aon Consulting. Its survey of 100 schemes found that 46% of...

News in brief.
July 7, 2008... BAA workers have accepted a pensions package, after months of battling with their employer over the closure of the scheme to new members. Following talks with Unite, workers agreed to accept the deal, which includes a 12-year guarantee for...

News: PA transfer rules will leave savers in lurch.
July 7, 2008... Byline: Charlie Thomas The government's proposal to prevent transferring in or out of personal accounts (PAs) will leave savers in a pensions "twilight zone", according to advisers. Speaking at Scottish Widows' conference on its UK...

News: Regulator and PPF unveil wind-up guide for trustees.
July 7, 2008... Byline: David Rowley Guidance for trustees on how best to wind up pension funds within two years has been published by the Pensions Regulator. The guidance, which has been produced alongside the Pension Protection Fund (PPF), includes...

News: Schemes derisking in preparation for buyout.
July 7, 2008... Byline: Charlie Thomas The 100 schemes currently considering a buyout have avoided the worst of recent market falls, according to Paternoster's Mark Wood. The insurer's chief executive stated that such funds have already moved to...

News: Merseyside to promote activism to members.
July 7, 2008... Byline: David Rowley The Merseyside Pension Fund has pledged to do more to inform its members of its active engagement on ethical investing. The move pre-empts a vote this week by Liverpool City Council, one of main employers for the...

News: Ombudsman backs Aviva trustees.
July 7, 2008... Byline: Charlie Thomas A co-habiting partner has won a Pensions Ombudsman determination in a dispute with her deceased partner's parents over a death-in-service pension. In the determination of Rushin vs Aviva Staff Pension Trustee,...

News in brief.
July 7, 2008... Asset managers owned by banks face being sold off as the impact of the credit crunch bites, according to Newton Investment Management. Simon Pryke, investment leader and banking analyst at Newton, said: "Banks are desperate for capital and...

News: Scheme disputes leave pensioners struggling.
July 7, 2008... Byline: David Rowley Two employees had to wait five years to receive their pensions until the Pensions Advisory Service (TPAS) intervened, according to its annual review. Case studies highlighted in the independent body's review for...

News: Sainsbury's refutes scheme sell-off rumour.
July 7, 2008... Sainsbury's has vehemently denied rumours suggesting it was considering selling its defined benefit (DB) pension scheme to a specialist insurer. Media reports claimed the supermarket giant wanted to offload its GBP2bn scheme to a buyout...

News: Two schemes fall victim to false claims.
July 7, 2008... Byline: Charlie Thomas British Steel and Western Power pension funds were found to be victims of fraud in a recent court case in Wales. Gerard Thomas, 53, from Swansea, was found guilty of falsely claiming his mother's pensions from...

News: Chief exec pans UK's investment strategy.
July 7, 2008... Byline: Kalpana Fitzpatrick UK pension funds are way behind their European counterparts when it comes to investing in alternative investments, City 'superwoman' Nicola Horlick has claimed. Horlick, who is chief executive of Bramdean...

News: Fund trio opts for diversity to rise above rate changes.
July 7, 2008... Byline: Tom Willetts Three diversified fixed income funds that can reduce the impact of UK interest rate changes on pension schemes have been launched by Henderson Global Investors. The firm hopes the funds can deliver better...

News: 10-strong group aims for 20% returns.
July 7, 2008... Byline: David Ricketts A group of UK pension funds have placed significant investments in a hybrid property/private equity fund that is targeting returns of 20% a year. The $5.2bn (GBP2.6bn) fund specialises in buying sub-investment...

Current affairs: No logo, no brand.
July 7, 2008... Byline: David Rowley The investment choices for most defined contribution schemes are prefixed with household names. The funds are usually run by companies such as HSBC Investments, Legal & General Investment Management, Barclays Global...

Current affairs: The future's not so bright for all.
July 7, 2008... Byline: Steve Bee The Pensions Bill debate in the House of Lords last week picked over the oh so thorny issue of how auto-enrolled pension savings can be eroded in value, or even rendered completely valueless, through interaction with our...

The insider: Personal view - Controlling the risk-based levy seems to be a case of running to stand still.
July 7, 2008... Byline: Paul Jayson Following publication of new scaling factors, it seems the collective pain and effort to bring down levies will be negated by the Pension Protection Fund (PPF) merely scaling them back up. If individual companies...

The insider: Technical view - Solutions for a complex basket of risks.
July 7, 2008... Byline: Amarendra Swarup As the credit crunch nears its first anniversary and stock markets around the world continue their inexorable slide downwards, defined benefit schemes are increasingly finding themselves facing new challenges....

Industry watch: Governance - M&S shareholders should oppose the Rose election.
July 7, 2008... Byline: Tom Powdrill This week will see one of the key AGMs of the 2008 season - Marks & Spencer - as investors decide how to vote on arguably the biggest UK corporate governance issue this year. This is, of course, the election of Sir...

Industry watch: Notice board - NAPF seminars, guides and events.
July 7, 2008... NAPF hot topic seminar Small schemes - issues and options July 17, NAPF, Westminster 10am - 3.30pm Small schemes, or more specifically, schemes offered by smaller employers, bring their own range of challenges. The NAPF's...

Industry watch: My life outside pensions.(Theater review)
July 7, 2008... Byline: Emma Douglas For Emma Douglas all the world's a stage, and all men and women merely players. For when she's not being the director of UK DC sales at Blackrock, she's treading the boards with her local theatre company. Having...

Pensions workout: Intermediate - Third-party administration - Intermediate level.
July 7, 2008... In the previous article, we covered the basics of third-party pensions administration. But what happens when you've made the decision to outsource? There are a number of key issues to consider. The first - and perhaps most obvious - is to...

Roundtable: Pensions Week: What do you consider to be the biggest issues in longevity today?(Discussion)
July 7, 2008... John Fitzpatrick: Who owns the risk of longevity? Of course, we all own our own personal risk, and hope to live a long life, but for the defined benefit (DB) pension plans in this country and the corpora-tions that sponsor those plans, it is a...

On the move: Singh Bains swaps BGI for Watson Wyatt.
July 7, 2008... Byline: Charlie Thomas Jagdeep Singh Bains is joining Watson Wyatt's London office as a senior investment consultant. He joins from Barclays Global Investors (BGI), where he was European head of transition portfolio management for five...

On the move: Going places.
July 7, 2008... Capita boosts board with quintet Capita Hartshead has appointed five directors to manage different specialist services. Andrew Bonnyman, who is currently operations manager, has been appointed director of pensions operations and will...

On the move: Top 4 Moves.
July 7, 2008... 01 - Darren Mason OLD - Mason worked in corporate recovery at Grant Thornton NEW - He is promoted to head of pensions advisory in the recovery and reorganisation team Tel: 0207 383 5100 02 - Gordon Sharp OLD - Sharp has...

News: CBI showdown over unfunded scheme debt.
July 14, 2008... Byline: David Rowley The Confederation of British Industry (CBI) is to launch into battle to reduce the size of the unfunded public sector pension liabilities. The employers' organisation is arguing that, as a major taxpayer, it has a...

News: BT fund vital stats just in.
July 14, 2008... Byline: David Rowley Newly published statistics reveal the BT Pension Scheme - the UK's biggest - to have grown to GBP39.6bn. The scheme is funded to around 97% of its liabilities, and saw a GBP1.2bn growth from its investments (6.4%)...

This week: Did they really say that?
July 14, 2008... Byline: David Rowley - Editor, Pensions Week I have just heard three of the biggest taboos in pensions broached. Two of them have been covered in this magazine, one of them I am pondering how to approach. They are, in no particular...

News: Industry comes to the defence of moral hazard.
July 14, 2008... Byline: Charlie Thomas Private equity firms should accept defeat on moral hazard powers being granted to the Pensions Regulator, according to key pension figures. The comments follow an open letter from Simon Walker, chief executive...

News: Small schemes thrown a lifeline by Credit Suisse.
July 14, 2008... Byline: Charlie Thomas A product that could provide a solution for small schemes struggling under the weight of longevity risk has been created by Credit Suisse. Its cashflow exchange longevity product allows a scheme to offload...

News: Paternoster ups minimum buyout quote level to GBP20m.
July 14, 2008... Byline: Charlie Thomas Insurance giant Paternoster has admitted it can no longer provide buyout quotes for schemes smaller than GBP20m. Prompted by queries from actuaries and PW, Paternoster amended the trustee section of its website...

News: Big players to dominate buyout, says SPC.
July 14, 2008... Byline: Owen Walker The expected sale of Synesis Life to fellow buyout provider Pension Corporation is a sign of things to come, according to the president of the Society of Pension Consultants (SPC). The UK pension buyout market is...

News in brief.
July 14, 2008... Liverpool Council has approved a motion calling on the Merseyside Pension Fund to ballot its members over calls for an ethical approach to investing its members' pensions. Though the council has no right to enforce a vote, it is able to...

News: Finance firms to gain edge with savings plans.
July 14, 2008... Byline: David Rowley Having a choice of pensions or savings contributions will be relatively common for financial services employees within three years, according to Mercer. The firm has a financial services client about to launch a...

News: Punter Southall launches longevity tool for trustees.
July 14, 2008... Byline: David Rowley A service that helps schemes choose an appropriate longevity improvement assumption has been launched by Punter Southall. Its Projected Longevity Generator - or ProLonG - looks at the projections available and...

News: Comparing KiwiSaver to PAs is misleading.
July 14, 2008... Simple comparisons between the New Zealand KiwiSaver and personal accounts should be avoided due to overwhelming differences, according to the Pensions Policy Institute (PPI). PPI research shows that since its launch a year ago, employers...

News: Council funds go legal to beat allocation rules.
July 14, 2008... Byline: David Rowley Local authority pension funds are seeking legal advice on ways to sidestep regulations that limit their private equity and hedge fund allocations to 10%. Law firm Sackers said it had received several queries from...

News: Pensions taking favour over property.
July 14, 2008... Byline: Ruth Emery Falling house prices in the UK have led to millions of people changing their minds about relying on their property as their pension. More than two million (2.3 million) Brits - 5% of the adult population - have taken...

News in brief.
July 14, 2008... Norwich Union has been declared the most generous annuity provider by Alexander Forbes Annuity Bureau. The Aviva company improved its level rate by GBP140 since June 2008 to GBP7,150 a year (based on a male purchasing an annuity at 60,...

News: Mini-flex product to offer debt repayment.
July 14, 2008... Byline: David Rowley Employees will be able to manage pensions, personal debt and employer share plans in a product to be launched by Standard Life. The plan, entitled Employee Wealth Management, will give employers the ability to help...

News: Offshore schemes' tax breaks under threat from HMRC.
July 14, 2008... The tax advantages of qualifying recognised overseas pension schemes are being threatened by closer HM Revenue & Customs (HMRC) scrutiny, according to a tax expert. These offshore schemes have been able to receive tax-effective transfers...

News: Salary sacrifice is gaining in popularity.
July 14, 2008... Byline: Charlie Thomas Salary sacrifice could result in increasing employee contributions by a fifth, according to research. A report, written by Fidelity International, has revealed companies that embrace the process can help...

News: HSBC struggling with exodus of recent hires.
July 14, 2008... Byline: Staff writer HSBC Global Asset Management's recruitment drive, which involved high level hires from competitors, has gone into reverse, with three exits in as many months. Head of institutional sales David Puddle, who joined...

News: RCM attributes grassroots research to stock successes.
July 14, 2008... Byline: David Rowley High volatility in global equities is proving its worth in the popularity of bottom-up stock selection, according to global asset manager RCM. The manager, which is part of Allianz Global Investors, has won...

News: Hermes bags first local authority client.
July 14, 2008... Byline: Kalpana Fitzpatrick The GBP3bn Lothian Pension Fund has boosted its corporate governance activity with the appointment of Hermes EOS for voting and engagement. The move follows a decision made earlier this year to sign up to...

Current affairs: Talking Heads.
July 14, 2008... Byline: Charlie Thomas 1 - Who should be responsible for promoting the open market option? 2 - Does the OMO need to be regulated? 3 - Should the OMO become the default option? John Lawson - Head of pensions policy, Standard...

Current affairs: Equities are still a major cornerstone for funds.
July 14, 2008... Byline: Clive Gilchrist Should pension funds hold equities at all? This question was posed to me recently - and by an actuary, no less. With equity indices back to levels of a decade ago, of course we should be questioning our strategies,...

The insider: Personal view - Worldwide investors can make a profit if emerging markets continue to flourish.
July 14, 2008... Byline: William Calvert Emerging markets are now the largest economic bloc having surpassed the EU, and represent over 30% of global GDP. However, emerging stock markets still only represent some 12% of global market capitalisation. The...

The insider: Technical view - ASB amendments may cause confusion.
July 14, 2008... Byline: Julian Le Fanu This year has seen two important consultations on pensions accounting, with discussion papers from the Accounting Standards Board (ASB) on the financial reporting of pensions and from the International Accounting...

Industry watch: Governance - Governance geeks must lead on engagement.
July 14, 2008... Byline: Tom Powdrill If you are one of the small number of sad, obsessive people, like me, who enjoys spending time leafing through institutional investors' voting disclosures, then the last few months have been more enjoyable than usual....

Industry watch: Notice board - NAPF events and guides.(Conference notes)
July 14, 2008... NAPF annual conference & exhibition 2008: Better knowledge for better pensions October 8-10, Scottish Exhibition & Conference Centre, Glasgow Don't miss the new-look NAPF annual conference & exhibition. All the leading speakers will be...

Industry watch: view from the bridge.
July 14, 2008... Byline: Norman Russell 169 To be 169 not out batting on an increasingly dodgy wicket would be a good score for a batsman in a test match; especially if he were a Scotsman. But the number 169 has nothing to do with runs on a cricket...

Pensions workout: Advanced - Third-party administration - Advanced level.
July 14, 2008... The most important part of any outsourcing process is the transition of data and services from one administration team to another. Get it wrong, and you can expect a multitude of problems throughout your contract. Get it right, and you lay a...

Special Focus: Introduction.
July 14, 2008... Byline: David Rowley - Editor, Pensions Week Is active fixed income the most exciting asset class of 2008? I have heard a lot of positive noises about the future prospects for certain asset classes since the beginning of this year, but the...

Special Focus: Closer range.
July 14, 2008... Byline: Pamela Atherton Fixed-income investment has come a long way since the 1990s, when bonds funds invested largely in gilts, investment-grade corporate bonds and US treasuries. Today, there is greater use of high yield assets such...

Special Focus: Creating a cash-plus scope.
July 14, 2008... Byline: Quentin Fitzsimmons Active fixed income fund managers can take significant positions against their benchmarks, adding alpha from duration, curve positioning and geographical positions, as well as sector and credit rating views in a...

On the move: Pensions Corp boosts business with Zakhary.
July 14, 2008... Byline: David Rowley Sherif Zakhary has joined Pension Corporation as head of business development. Zakhary joins from MetLife Assurance where he was chief executive officer in London. He led MetLife's pension and buyout, and risk...

On the move: Going places.
July 14, 2008... Bailey bins BlackRock to join Hewitt Ian Bailey has joined Hewitt Associates as an investment consultant, after 31 years with BlackRock Investment Management (UK). While at BlackRock, Bailey was responsible for relationships with some...

On the move: Top 4 moves.
July 14, 2008... 01 - Jagdeep Singh Bains OLD - Singh Bains was European head of transition portfolio management at Barclays Global Investors NEW - He becomes a senior investment consultant at Watson Wyatt Tel: 01737 241144 02 - Andrew...

News: BT adds value with its rapid response plan.
July 21, 2008... Byline: David Rowley The BT Pension Scheme is estimated to have saved hundreds of millions of pounds after it brought in monthly investment committee meetings in January. The savings have largely come from the use of tactical equity...

News: DC deferreds racking up costs for companies.
July 21, 2008... Deferred members of defined contribution (DC) schemes can cost sponsoring employers anywhere between GBP35 to GBP94 each a year, according to new research. The figures from Capita Hartshead are largely made up of costs for administration...

This week: The amateur ethos at threat.
July 21, 2008... Byline: David Rowley - Editor, Pensions Week "We are long-term investors." "Short-term market movements do not bother us." "We've weathered other stock market falls before." This is still the prevailing opinion from pension funds when...

News: FAS buyback hopes trampled by Treasury.
July 21, 2008... Byline: Charlie Thomas Buyback schemes that could have given some members of the Financial Assistance Scheme (FAS) close to 100% of the original pensions, have been abolished. Under new legislation passed this week, the buyback scheme,...

News: Ombudsman hits turnaround targets prior to FOS merger.
July 21, 2008... Pension ombudsman cases are being completed quicker than ever before, according to the latest pensions ombudsman report. For the third year running, the number of cases being taken on was less than those being closed, a trend that new...

News: Massive gap in death data hinders fight against fraud.
July 21, 2008... Byline: Charlie Thomas A 16-month black hole of lost death data could cause problems for schemes actively trying to prevent fraud. In March 2007, the Identity & Passport Service (IPS) stopped its death registration service, which had...

News: Governance standards still lacking.
July 21, 2008... Byline: Kalpana Fitzpatrick Pension schemes must do more to improve governance with better documentation and record-keeping, according to the Pensions Regulator. Although schemes on the whole are doing well, the regulator said in its...

News in brief.
July 21, 2008... The GBP4.26bn Merseyside Pension Fund saw a 1.3% fall in assets in the year ending March 2008. Its bespoke benchmark returned -0.7%, but the average return over the same period of all local authority pension funds based on the WM local...

News: Councils seek advice to play by govt rules.
July 21, 2008... Independent advisers are anticipating a surge in business as local authorities scramble to fall in line with best practice guidelines on investment advice. Several multi-billion pound county council pension funds are tendering for...

News: Unions denounce 'get-rich-quick' buyout schemes.
July 21, 2008... Byline: Kalpana Fitzpatrick Unions are seeking to stall pension fund investment in private equity where it leads to acquisitions that bring job losses. Since the credit crunch, private equity firms have found it harder to obtain...

News: Boom in DC contributions expected.
July 21, 2008... Byline: Charlie Thomas Two out of five final salary schemes expect to close to future accrual within the next decade, according to Watson Wyatt. Its research has revealed that the percentage of defined benefit schemes open to new...

News: Letter - Consultancies cashing in on DB doom and gloom.
July 21, 2008... "Am I alone in sensing an ever-increasing abundance of surveys telling us private sector defined benefit (DB) schemes are even more of an endangered species now than they were a few years ago? "Is it really as bad as these...

News: Managers suffer from Falkirk mandate cuts.
July 21, 2008... Byline: Kalpana Fitzpatrick Fund managers Schroders and Capital International are to see their equity mandates slashed by a UK council pension fund, following performance concerns. The GBP900m Falkirk Council Pension Fund currently...

News in brief.
July 21, 2008... The BBC has increased contributions into its pension fund from 17.6% to 19.6% this month over concerns at rising longevity. Despite showing a surplus, the policy has been taken to allow for more prudent assumptions to be set, and to enable...

News: Industry backs AMC structure for PAs.
July 21, 2008... Byline: Owen Walker There has been overwhelming industry support for two charging structures for personal accounts. A survey conducted by the Personal Accounts Delivery Authority (PADA) found an annual management charge (AMC), and a...

News: Fiduciary firms turn liability into profit with 12% returns.
July 21, 2008... Byline: Charlie Thomas Fiduciary management has proved profitable this year, with Psolve reporting equity-beating returns of 12%. The liability-led service enables quick decision-making about asset allocations, allowing investment...

News: NAPF calls for 'real world' ideas from ASB.
July 21, 2008... Byline: Kalpana Fitzpatrick The National Association of Pension Funds (NAPF) has slammed the proposals on the financial reporting of pensions for not operating in the real world. In its response to the consultation on the Accounting...

News: Hedge fund stability elicits allocation boost.
July 21, 2008... Byline: David Rowley A second wave of hedge fund investing is seeing some pension schemes up allocations to 15%-20%, according to a fund-of-funds manager. The move is being prompted by investors, who have seen their hedge fund...