Pensions Week articles from May 2009

Pensions Week archives from May 2009

News: Manchester fund takes a tactical view.
May 4, 2009... Byline: David Rowley The Greater Manchester Pension Fund is setting up a special situations fund representing 5% of its assets to target market opportunities. The local authority fund, valued at GBP9bn in March 2008, is looking at...

News: Governor for BT's Sipp scheme.
May 4, 2009... Byline: David Rowley Mark Ashworth, a director of Law Debenture, has been appointed to chair the governance committee of the BT group self-invested personal pension (Sipp). In April, staff in BT's trust-based plan were moved to the...

This week: The few will spoil it for the many.
May 4, 2009... Byline: David Rowley - Editor Years ago, I had a crummy summer job while at university, that involved data extraction from accounts filed at Companies House. We were paid poorly and hourly. We used to take half-hour lunch breaks,...

News: Mazars in spotlight over transfer advice.
May 4, 2009... Byline: Charlie Kirby Accountancy firm Mazars is being investigated over advice it gave trustees of the First Quench Pension Fund. Mazars acted as a financial adviser to the trustees of the First Quench Pension Fund when the scheme...

News: Offshore bonds could relieve HNW tax burden.
May 4, 2009... Byline: Charlie Kirby High net worth individuals may move their savings into offshore bonds to avoid the penal taxation introduced by the Budget. By moving their money into an offshore bond in a region that doesn't apply tax to...

News: Bermudan firm targets deferreds in buy-in deals.
May 4, 2009... Byline: Tom Willetts A Bermudan insurer is aiming to undercut providers offering buy-in contracts for deferred members of pension schemes by exploiting the island's flexible financial regulations. Bridge Pointe has appointed Francis...

News: PADA sets out deed for personal accounts.
May 4, 2009... Byline: Tom Willetts The Personal Accounts Delivery Authority and the government are consulting on the scheme order and rules for personal accounts. The scheme order is the equivalent to a conventional trust-based pension scheme's deed...

News in brief.
May 4, 2009... Around 11,000 members joined the John Lewis Partnership pension scheme last year. The influx of members followed a decision to reduce the waiting period for membership from five to three years. Hartford Life has suspended its variable...

News: Berkshire fund adopts transparent platform.
May 4, 2009... Byline: Tom Willetts The GBP1.4bn Royal County of Berkshire Pension Fund has become one of the first local authority schemes to use a managed account platform for hedge funds. The platforms have become popular in the wake of the...

News: Longevity bonds could help funds meet liabilities.
May 4, 2009... Byline: David Rowley The Pensions Institute at Cass Business School has called on the government to issue longevity bonds. Such bonds would make payments linked to the future survival rate of a specified cohort of the population, such...

News: Contingent assets rated too complex.
May 4, 2009... Byline: Charlie Kirby Contingent assets may prove too complicated to be considered as a way of shoring up scheme funding, according to an expert trustee panel. Speaking at Redington Partner's trustee Redtable event on April 29, Chris...

News: High standards lead to ETV overload.
May 4, 2009... Byline: David Rowley Around five FTSE 100 companies are expected to carry out enhanced transfer valuation (ETV) exercises this year, according to Prudential. The insurer has based its figure on feedback from consultants and independent...

News: Annuitants suffer as equity markets rise.
May 4, 2009... Byline: Tom Willetts The gains in the equity market last month were offset by falling annuity rates for defined contribution (DC) members approaching retirement, according to Aon Consulting. The firm's DC Pension Tracker, which...

News: Midlands-based schemes account for 20% of PPF.
May 4, 2009... Midlands-based pension funds are overly represented among those that have entered the Pension Protection Fund (PPF). Aon Consulting's Birmingham office calculates that nearly 20% of schemes in the PPF are from the Midlands, and that looming...

News in brief.
May 4, 2009... Bfinance, the specialist fund manager search consultancy, has completed a management buyout. Chief executive and founder David Vafai, now takes a 100% stake in the firm. He said that the deal creates the opportunity to provide its...

News: Rising admin costs see funds look to outsource.
May 4, 2009... Byline: David Rowley The average administration cost per member of a scheme of between 10,000 and 40,000 lives has risen to GBP48 a year. Watson Wyatt's annual Pension Scheme Cost Survey calculated that the average admin cost per...

News: Funding targets need extra GBP60bn.
May 4, 2009... Byline: Charlie Kirby Trustees' funding expectations have grown from 70% of the buyout cost to 75% over the last year, according to PricewaterhouseCoopers (PwC). This rise requires an added injection of GBP60bn to reach the new...

News: Derisking insight - Better data helps lower risk and cost.
May 4, 2009... Byline: David Ellis - Principal, Mercer Hands up if you are a trustee or pensions manager who knows precisely which benefits to pay to which beneficiaries. If your hand is raised, congratulations but you are likely to be in a minority. ...

Awards news: Provider Awards 2009 - Please take your seats for PIPA 2009.
May 4, 2009... Wednesday 6th May - Sheraton Park Lane Hotel Piccadilly, London, W1J 7BX The event What makes a PIPA awards winner? All of the entrants on the right will have had to give evidence of their successes in 2008, their innovation, their...

In depth: Talking heads.
May 4, 2009... 1 - Which current market opportunities are you most excited by? 2 - What major market risks are you most concerned about? 3 - Do the risks outweigh the opportunities at the present time? Richard Turnill - Head of global equity,...

In depth: UK pensions: change you can't believe in.
May 4, 2009... Byline: Steve Bee - Head of pensions policy, Scottish Life I've been a part of the pensions industry for so long now that I thought I was immune to shock or surprise. My current pensions world view is that the UK pensions system is in the...

In depth: Personal view - LGPS schemes share common ground with private sector funds in terms of risk.
May 4, 2009... Byline: Gary Delderfield Until relatively recently, it could be said that the areas of public sector and private sector pension schemes were worlds apart. However, this is changing, especially in relation to the Local Government Pension...

Jargon buster.
May 4, 2009... FRS 17 This is the UK pension accounting standard. It stipulates how those UK companies not listed on the London Stock Exchange should record their obligations to pension schemes in their company accounts. The current version of FRS 17 is...

In depth: Technical view - Sympathy for public sector pensions.
May 4, 2009... Byline: Hilary Salt It's not hard to find bodies suggesting that time be called on public sector pensions the Confederation of British Industries, the Taxpayers' Alliance, the Tories, and now Gordon Brown has even asked for alternatives...

In depth: Without prejudice.
May 4, 2009... Byline: Anne-Marie Winton - Partner, Nabarro I am not on Facebook or Friends Reunited. I do not Twitter, tweet, text or blog. I do not Askjeeves who I am each morning or check where I am via Google Earth. I am not a Wikipedia entry or on...

In depth: Notice board - NAPF update.
May 4, 2009... Hot Topic Seminar: Managing DB risk June 5, 2009 NAPF, Westminster The next NAPF hot topic seminar is all about managing DB risk. Speakers include Chris O'Brien, University of Nottingham; Matthew Swynnerton, DLA Piper; Michael...

Pensions workout: Beginner - Absolute return investing - Beginners' level.
May 4, 2009... For the past two decades, the staple fare of active investors and investment managers has been to try to outperform market returns. For many schemes, such relative return investing has left a large deficit following the market falls of last...

Supplement: Special Focus - Introduction.
May 4, 2009... Byline: Charlie Kirby - Deputy editor Investment managers have been feeling the heat of being under the spotlight more than ever recently. As members consider how the recession has affected their savings, they will come under pressure...

Supplement: Special Focus - Survival of the fittest.
May 4, 2009... Byline: Brandon Michael Few investors have been satisfied with portfolio performance over the last 18 months, as markets across the globe have tumbled precipitously. Alpha-extension strategies, commonly referred to as 130/30 investing, had...

Supplement: Special Focus - Company focus - A word from the sponsor...
May 4, 2009... Global presence With EU920bn (GBP819bn) in assets under management and access to more than 75 million clients, Allianz Global Investors is one of the world's largest active asset managers. Its first-class network of specialists spans the...

On the move: Cardano duo boosts investment team.
May 4, 2009... Byline: Nick Reeve Investment services provider Cardano has appointed Santiago Pinson and Nathalie Sims to its investment management team. Pinson was previously senior portfolio manager and head of research in Atlas Capital's wealth...

On the move: Going places.
May 4, 2009... Sackers gets assistance from Ghelani and Lovett Sacker & Partners has appointed Chirag Ghelani and Ferdinand Lovett as assistant solicitors. Ghelani joins the specialist pensions law firm after completing a training course with Norton...

On the move: This week on Twitter.
May 4, 2009... To take advantage of PW's launch on the micro-blogging website Twitter, we're rounding up the best of the pensions debates from the 'twitter-sphere'. Pensions campaigner Ros Altmann was left decidedly unimpressed by the 2009 Budget report....

News: DC blueprint from PADA sets standard.
May 11, 2009... Byline: David Rowley The quality of the Personal Accounts Delivery Authority's (PADA) investment proposals have been hailed as a breakthrough for UK defined contribution (DC) investing. Both consultants and fund managers have described...

News: Providers take pride at PIPAs.
May 11, 2009... Byline: Charlie Kirby BlackRock and Newton Investment Management swept the board at this year's Pensions and Investment Provider Awards, winning three awards each. Newton Investment Management won the active UK equity, active European...

This week: To err is human... and very annoying.
May 11, 2009... Byline: David Rowley - Editor Concise news for impatient, busy professionals is how I envisage Pensions Week, so I was mortified to discover that at the end of last week's editorial, I posted a website address that was either wrong or...

News: Pension funds snap up Network Rail bonds.
May 11, 2009... Byline: Tom Willetts Three-quarters of investors in a Network Rail inflation-linked bond issue were pension schemes looking to avoid the volatility of equities and disruption in the swaps market. The investors, which included a GBP6bn...

News: Alternative to cuts in tax relief sent to chancellor.
May 11, 2009... Byline: David Rowley A letter written to the chancellor has proposed reducing the annual pensions allowance as an alternative to cutting tax relief on pension contributions. In the letter, David Seaton, joint managing director of...

News: Rule change for trivial commutation cases.
May 11, 2009... Byline: Charlie Kirby Pension pots of less than GBP2,000 can now be taken as a collective lump sum, regardless of larger pension provisions. Under the much-delayed rules implemented on May 8, small occupational pension pots up to the...

News: High Court rewrites the rules for DB fund.
May 11, 2009... Byline: Tom Willetts A defined benefit pension scheme's rules have been rewritten to reflect the intention of its sponsor and trustees after a High Court decision. Chemical manufacturer Colorcon applied to the court to correct the...

News in brief.
May 11, 2009... Research from Pension Capital Strategies and Cazenove has shown that 22 FTSE 100 companies disclosed a pension surplus in their most recent annual report and accounts. However, the analysts estimate that only around 15 companies would...

News: Govt urged to bankroll Equitable payback fund.
May 11, 2009... Byline: Charlie Kirby The government must open and fund a compensation scheme for Equitable Life policyholders, according to the parliamentary ombudsman's latest report. Ann Abraham cites 10 determinations of maladministration on the...

News: Personal accounts dependent on corporates.
May 11, 2009... Byline: Charlie Kirby The Personal Accounts Delivery Authority (PADA) cannot provide a low-cost scheme if corporates turn away from personal accounts, according to Punter Southall. A survey conducted by Punter Southall showed 80% of...

News in brief.
May 11, 2009... The Pensions Regulator is running free workshops on DB scheme funding to improve understanding during the recession. The workshops will cover technical provisions, recovery plans and activities that can be detrimental to schemes, such as...

News: Debt avoidance could target dividend firms.
May 11, 2009... Byline: Tom Willetts Companies could be ordered to pay money into schemes when dividends are paid to shareholders under new debt avoidance powers. The government originally agreed to give the Pensions Regulator the power to demand that...

News: High yield bonds flourish as banking sector stabilises.
May 11, 2009... Byline: Tom Willetts High yield bonds will continue to outperform, according to a fund manager, amid record investment in the asset class. The Investment Management Association reported GBP93m of high yield bonds were sold in March - a...

News: Dampened demand for manager searches.
May 11, 2009... Byline: David Rowley Mercer has recorded a decline in fund manager searches among its UK institutional investor clients over 2008. The biggest falls in manager searches by asset class were in UK equity, property, tactical asset...

News: Firms must be able to defer scheme payments.
May 11, 2009... Byline: Charlie Kirby Mercer has called on the government to allow companies at threat of failing to defer contributions to their pension scheme. In a letter to the Pensions Regulator and the Department for Work and Pensions, Mercer...

News: IPs permitted to notify online.
May 11, 2009... Byline: David Rowley Insolvency practitioners (IPs) are being allowed to file reports of failed businesses to the Pension Protection Fund (PPF) online in a bid to speed up notifications. Under the old paper-based system, more than 200...

News: Investment insight - Don't rule out diversification.
May 11, 2009... Byline: Mirko Cardinale - Head of strategic asset allocation research, Aviva Investors Murphy's law of diversification states that diversification opportunities are least available when they are most needed. And the recent convulsions in...

In depth: Talking heads.
May 11, 2009... 1 - What percentage of scheme members do you expect to be better off not contributing to pensions following the cuts in tax relief for high earners? 2 - The exit of chief executives from occupational schemes is being seen as a damaging...

In depth: No one escapes the impact of tax changes.
May 11, 2009... Byline: Clive Gilchrist - Managing director, Bestrustees I have attended only a few trustee meetings since the Budget; most such meetings are later in the quarter. But there has only been one topic of conversation - the changes in pension...

In depth: Personal view - The property axeman cuts through the market with continued strength.
May 11, 2009... Byline: William Hill The traditional penalty for excesses in property markets is death by a thousand cuts. In other words, a long and drawn out process of pain, suffering and lingering death before finally it is all over and the cycle can...

In depth: Jargon buster.
May 11, 2009... Guidance note 11 (GN11) GN11 was a document issued by the actuarial profession that provided actuaries with guidance on the calculation of cash equivalent transfer values. GN11 no longer exists and it is the trustees who are responsible...

In depth: Technical view - Revaluing the deferred pension level.
May 11, 2009... Byline: Pat Wynne For members of defined benefit (DB) schemes that leave with deferred pension entitlements, legislation (since the mid 1980s) has specified a minimum rate of revaluation of the deferred pension over the period to its...

In depth: Corporate governance - Many voices make a bigger difference.
May 11, 2009... Byline: Tom Powdrill The shareholders, it seems, are revolting. As we've noted numerous times in this column over the past couple of years, despite a lot more talk about corporate governance and investor activism, many institutional...

In depth: My life outside pensions.
May 11, 2009... Byline: Allan Course - Independent trustee, Capital Cranfield His lifelong interest in what is technically known as flint-knapping has led to several television appearances to demonstrate how effective Stone Age bow and arrows were at...

In depth: Notice board - NAPF update.
May 11, 2009... Hot Topic Seminar: Managing DB risk June 5, 2009 NAPF, Westminster The next NAPF hot topic seminar is all about managing defined benefit (DB) risk. Speakers include Chris O'Brien, University of Nottingham; Matthew Swynnerton, DLA...

Pensions workout: Intermediate - Absolute return investing - Intermediate level.
May 11, 2009... In this article we dig a little deeper into absolute return investing to look at the types of funds and the issue of market timing. Diversified growth funds Diversified growth funds (DGFs) offer a more varied range of asset classes...

Roundtable: How appropriate for consumers are lifestyle default funds, and is there a single-structure solution for DC schemes?(Discussion)
May 11, 2009... The Panel Robert Booth - Investment strategy manager, Axa John Jory - Deputy CEO, B&CE Benefit Schemes Graham Mannion - Managing director, PensionDCisions Stephen Nichols CEO, The Pensions Trust Mark Fawcett - Investment...

Supplement: Special Focus - Introduction.
May 11, 2009... Byline: David Rowley - Editor A small percentage of pension funds made positive returns in 2008 owing to a range of hedges and side bets, termed as options, swaps and overlays. Many of these schemes made the positive returns as a result of...

Supplement: Special Focus - Keeping a lid on loss.
May 11, 2009... The UK equity market plunged more than 30% during 2008 (measured by the FTSE All Share Index). In the US and Europe, equities fell even further and some major Asian equity markets halved in value. History shows that while equity market losses...

On the move: Hymans chooses Wright man for job.
May 11, 2009... Byline: Nick Reeve Hymans Robertson has appointed John Wright to the newly created role of head of public sector consulting. Wright has been a partner at Hymans Robertson since 2005 and has advised many local government pension...

On the move: Going places.
May 11, 2009... Bourke to oversee the books at Friend Prov Friends Provident has hired Evelyn Bourke as chief financial officer (CFO) and placed her on the board of directors. Bourke joins from Standard Life, where she was CFO, having also worked as...

On the move: This week on Twitter.
May 11, 2009... Is using Twitter or Facebook likely to change the way you respond to your investments? IFA Life, an IFA networking website, promoted an interesting discussion on this in which Adam Bold, CIO of American firm Mutual Fund Store, said that...

News: Regulator steps in over BT deficit.
May 18, 2009... Byline: Tom Willetts A disagreement between BT and its pension scheme trustees over the size of its deficit has forced the Pensions Regulator to intervene, according to consultants. The dispute follows the publication of the company's...

News: BlackRock eyes up BGI.
May 18, 2009... Byline: Charlie Kirby Barclays is rumoured to be in talks to sell its asset management arm, Barclays Global Investors (BGI), to BlackRock. The bank had previously agreed in principle to sell iShares, the main part of BGI, to private...

This week: Credit where credit's due.
May 18, 2009... Byline: David Rowley - Editor The public perception of the Pensions Protection Fund (PPF) is of an encumbered organisation with a questionable ability to honour payments for all the stricken pension funds thrust upon it. Not that far off...

News: PADA allays fears over UK admin jobs.
May 18, 2009... Byline: David Rowley The Personal Accounts Delivery Authority (PADA) has given assurance over UK jobs after revealing three firms shortlisted for its administration contract are based abroad. This follows disquiet from many pension...

News: Lawyers applaud taxation relief for unauthorised pay.
May 18, 2009... Byline: Charlie Kirby HM Revenue & Customs (HMRC's) relaxation on unauthorised pension payments has been welcomed by a leading law firm. The new regulations will help schemes deal with some of the former problems with the unauthorised...

News: Babcock pioneers the longevity-based buyout.
May 18, 2009... Byline: Tom Willetts Synthetic buyouts are set to become a reality after Babcock International's pension schemes became the first to agree to use swaps to hedge longevity risk. These innovative products are created by combining...

News: What is a longevity swap?
May 18, 2009... A longevity swap allows a pension scheme to remove the risk that members live longer than expected. However, unlike a buyout or buy-in, there is no transfer of the underlying assets and the associated investment risks. There are two types...

News in brief.
May 18, 2009... The proposal to consolidate an expenses allowance into MPs' salaries would generate a GBP11.5m pensions bill, according to Clive Grimley, a partner at Barnett Waddingham. "Care must be taken not to allow the MPs to consolidate the...

News: Equities set to rally and then plateau.
May 18, 2009... Byline: David Rowley The recovery in UK equities will continue for the next few months, but thereafter values will plateau, Legal & General Investment Management (LGIM) believes. The fund manager said the current rally would be...

News: Risk management firm comes to UK.
May 18, 2009... Byline: Tom Willetts Specialist consulting firm Ortec Finance is to open an office in London this week to help trustees and sponsors manage their exposure to different types of risk. It will model worst-case scenarios and assess the...

News in brief.
May 18, 2009... A large DC scheme has moved its default fund to cash. Speaking at a recent PW roundtable on DC default funds, Graham Mannion, managing director of PensionDCisions, said: "The key driver was probably a belief among trustees that it was not...

News: PADA shying away from default annuity.
May 18, 2009... Byline: Charlie Kirby The Personal Accounts Delivery Authority (PADA) has hinted heavily that a default annuity will not be available at the decumulation stage of personal accounts. Speaking at the Future of Life Assurance conference,...

News: Providers eager to fill Hartford's shoes.
May 18, 2009... Byline: Charlie Kirby Hartford Life's exit from the UK variable annuity market could kick-start product innovation from its former rivals. Living Time's chief executive officer Kim Lerche-Thomsen, confirmed that a new product, which...

News: Investment insight - Is it time to re-enter the US equity market?
May 18, 2009... Byline: John R. Mowrey - Product specialist, NFJ & Allianz Global Investors Last year marked one of the most tumultuous periods in US equity market history as stocks suffered their greatest losses since the Great Depression. Investors ran...

News: Streamlining saves NHS scheme GBP6.2m.
May 18, 2009... Byline: Charlie Kirby The NHS pension scheme has cut annual administration costs by GBP6.2m since 2006. The savings were primarily produced through the scheme's merger into the Business Services Authority in 2006, which through...

News: Prioritise pension schemes in pre-packaged admins.
May 18, 2009... Byline: Tom Willetts More attention must be given to pension schemes during pre-packaged administrations, according to a buyout firm. Pre-packs involve the sale of all or part of a struggling company's business or assets, and are...

News: Losses slow for commercial property.
May 18, 2009... Byline: David Rowley A turning point in UK commercial property valuations is expected at the end of 2009, according to Legal & General Investment Management. The manager's specialist property fund for pension scheme investors has...

News: Zurich DB members given online platform.
May 18, 2009... Byline: David Rowley Close to 30,000 members of the Zurich Financial Services final salary scheme can now activate pensions in payment through an online self-service platform. Zurich is promoting it as part of its own third-party...

News: Funding upturn for PPF 7800.
May 18, 2009... Byline: Charlie Kirby A 4% increase in assets and higher gilt yields led to improved funding positions for schemes in the Pension Protection Fund 7800 last month. A 7.5% rise in UK and global equities caused assets to improve by 4%,...