Pensions Week articles from November 2008

Pensions Week archives from November 2008

News: Default is the right choice for majority.
November 3, 2008... Byline: David Rowley Defined contribution schemes should celebrate the fact that 90% of members typically choose the default fund, according to Axa. In an outspoken view that reflects behavioural science research carried out by the...

News: Women to pay 50% more for their pension.
November 3, 2008... Byline: Tom Willetts Thousands of women trying to qualify for the full state pension will be hit with a massive price hike. Under proposals incorporated in the pensions bill, women who have traditionally had incomplete national...

This week: When did the ASP go mainstream?
November 3, 2008... Byline: Charlie Kirby - Deputy editor During a recent lively commons debate, Rosie Winterton responded to the Conservatives' call to scrap compulsory annuitisation by saying that a short- term measure wouldn't help the majority of...

News: Gissings GPP aims to rival PA fees.
November 3, 2008... Byline: David Rowley Employers are being offered a group personal pension (GPP) that comes with free consultancy advice and only a 0.4%-0.65% annual management charge for employees. The product, Gissings Select, has been created by...

Mixed results for group pensions among providers.
November 3, 2008... Byline: David Rowley Standard Life and Prudential have both reported rises in group pensions business, while Scottish Life and Friends Provident have seen falls. The biggest winner was Standard Life, which saw a 10% rise in group...

News: Lords reject public sector pensions body proposal.
November 3, 2008... Byline: Tom Willetts A proposal to set up an independent public sector pensions commission has been defeated in the House of Lords. Liberal Democrat peer Lord Kirkwood tabled an amendment to the pensions bill, which would have set up a...

News: Money market fund gets AAA rating.
November 3, 2008... Byline: Charlie Kirby Barclays Global Investors (BGI) has launched an AAA-rated money market fund. The BGI Sterling Government Liquidity Fund provides access to sterling- denominated government securities. It sits within BGI's cash...

News in brief.
November 3, 2008... Lane Clark & Peacock has called on the European Commission to consider clarifying the purpose and priorities of Solvency II. Andrew Cox, partner at consultant, said: "Many will regard the Basel II framework as having failed to deliver...

News: Exit fee rises aim to smooth out returns.
November 3, 2008... Byline: Charlie Kirby The pensions industry has broadly supported insurers' dec-ision to increase some pension exit fees. Aviva, Standard Life, Friends Provident and Pearl have all increased fees for those wishing to leave some of...

News: Communication required to allay DC members' fears.
November 3, 2008... Byline: Tom Willetts Scheme sponsors can put defined contribution (DC) pension scheme members at ease during the financial crisis by communicating with them more, according to Fidelity International. The number of members requesting...

News: LGPS report shows funding level upturn.
November 3, 2008... Byline: David Rowley The average retirement age for local government pension scheme (LGPS) members has risen consistently over the last 10 years. According to research from Hymans Robertson, the average retirement age increased from...

News: PPF plans reserve against key risks.
November 3, 2008... Byline: Tom Willetts The Pension Protection Fund (PPF) is to build a financial reserve to protect itself against the liabilities of 7,400 schemes that have seen significant funding falls. The schemes are run by solvent employers, but...

News: Calls for independent mortality body.
November 3, 2008... Byline: Charlie Kirby Financial, academic and medical communities must work together to develop an approach to mortality forecasting, according to Paternoster's Richard Willets. Speaking at the Actuarial Profession and International...

News in brief.
November 3, 2008... Most companies are failing to measure whether they benefit from money spent on pensions, according to a survey. Less than half of companies measure whether expenditure increases productivity, staff loyalty or shareholder value, research...

News: Buyout deals on hold over bonds anxiety.
November 3, 2008... Byline: Tom Willetts Buyout deals that were close to completing have been put on ice as insurers become unwilling or unable to transact over the short term. Insurers are also imposing a higher fee for paying in cash or other assets...

News: Firms urged to sign up to ESG principles.
November 3, 2008... Byline: Tom Willetts A group of global investors is calling on 9,000 listed companies to sign up to international standards on human rights, the environment and anti- corruption measures. The 52 investors, including the BT pension...

News: The savings crisis.
November 3, 2008... The Pensions Commission calculated that 4.8 million employees do not join their company pension scheme, and now Prudential has put a figure of GBP5.07bn on the consequences of this action. The companies' research was based on quizzing 1,000...

Asset news: Funds suffer fallout from financial crisis.
November 3, 2008... Byline: Tom Willetts The impact of the credit crunch showed up starkly in bond fund results for the third quarter, according to Standard & Poor's. The performance of funds rated by the firm diverged significantly with M&G's Strategic...

Asset news: Pooled funds show poor returns in Q3.
November 3, 2008... Byline: Tom Willetts Most pooled fund sectors failed to achieve positive median returns last quarter, according to BNY Mellon Asset Servicing. Balanced pooled funds returned -8.9%, compared with -1.6% for the previous quarter, with a...

News in brief.
November 3, 2008... Pension schemes should invest in small caps, according to Deryck Noble- Nesbitt, who leads the smaller companies team at Close Investments. "Now is the time to start acting to invest in smaller companies while sentiment is poor," he said....

UK scheme awards: Pensions & Investment UK Scheme Awards 2008.
November 3, 2008... Byline: Padraig Floyd The event The Pensions & Investment UK Scheme Awards celebrate what is good in UK pensions practice - work that not only gets a job done, but has a earing upon whether individuals reach retirement with a realistic...

In depth: Making it through the darkest hour.
November 3, 2008... Byline: Clive Gilchrist I wrote in January about the overuse of hackneyed phrases such as 'unprecedented collapse' or 'a once-in a lifetime event'. My point was that the situation really wasn't that bad. But that was then; now is the time...

In depth: Personal view - A long way still to go before women receive fairer pensions and benefits.
November 3, 2008... Byline: Fiona Tait Over 63% of the population who are currently claiming state pension are women. Compared with men they earn less, save less and live longer on lower pensions. Will auto-enrolment into personal accounts solve this problem...

In depth: Jargon buster.
November 3, 2008... Hedge Protection against a particular outcome. A hedge fund covers a wide range of funds whose managers are trying to generate returns independently of any general movement in markets. Hedge funds can be largely grouped into eight fund...

In depth: Technical view - Hurdles to overcome before 2012.
November 3, 2008... Byline: Conor Breen The NAPF Annual Survey reveals a picture of both continuity and change in UK workplace pension provision in 2008. The survey covers 502 pension schemes with over GBP460bn in assets and addresses issues in both defined...

Industry watch: Governance - Prevention is better than complex cure.
November 3, 2008... Byline: Tom Powdrill As you may have noticed, Keynesianism, at least in part, is back in fashion. Part of Keynes's prescription for preventing a recession developing into a depression was, of course, to maintain aggregate demand through an...

Industry watch: Notice board - NAPF events and training.
November 3, 2008... NAPF Trustee Conference: Understanding and controlling risk November 26, 2008, One Great George Street The new minister for pensions reform, Rosie Winterton, will headline a programme of industry speakers at the NAPF trustee...

Industry watch: My life outside pensions.
November 3, 2008... Byline: Ian Price "If you are 10 years old and you have to look after your mother and father, someone has got to help you so that you can grow up as a child," says Ian Price, divisional director of pensions at St James's Place. There...

Pensions workout: Intermediate - Pension scheme surplus - Intermediate level.
November 3, 2008... Although a surplus in an ongoing scheme may be considered notional, the debate over ownership of surplus and the ways in which such a surplus can be used is very real. In most defined benefit (DB) schemes the employer's contribution will...

Special Focus: Introduction.
November 3, 2008... Byline: David Rowley - Editor Fiduciary management is a solution to dynamic investment whose hour has surely come. There are only a handful of companies currently offering this to UK pension schemes, but as the appeal of it grows, it seems...

Special Focus: Could the UK go Dutch?
November 3, 2008... Byline: Matthew Craig The Dutch are known for doing things a bit differently and their pension funds are no exception. For example, fiduciary manage-ment has swept through the sophisticated and well-funded Dutch pension fund sector since...

Special Focus: Time for change.
November 3, 2008... Byline: Patrick Disney At a time when the role of trustees at occupational pension schemes is being questioned more often than ever, the use of fiduciary management could be a vital lifeline to help trustees fulfil their responsibilities....

Special Focus: Company focus - A word from the sponsor...
November 3, 2008... Background SEI is one of the leading providers of fiduciary management for pension schemes worldwide. The company was founded in 1968 in Pennsylvania, USA and has been at the forefront of investment and pension innovation ever since. SEI...

On the move: EPIC adds wealth of experience to panel.
November 3, 2008... Byline: Tom Willetts AllenbridgeEPIC Investment Advisers (AEIA) has appointed Keith Bray and Jim Tennant to its investment panel. Tennant has more than30 years' investment management experience and recently retired from Gartmore, where...

On the move: Going places.
November 3, 2008... Jenkins to lead wealth plan at Standard Life Standard Life has appointed Jamie Jenkins as head of employee wealth solutions in its marketing division. The move will complement the firm's acquisition of Vebnet, the flexible benefits...

Special Supplement: Group Sipps - Introduction.
November 3, 2008... Byline: Charlie Kirby - Deputy editor Group self-invested personal pensions (Sipps) have become one of the most talked about products on the pensions market. The tax-efficient way to boost your employees' savings, and therefore boost your...

Special Supplement: Group Sipps - Satellite model.
November 3, 2008... Byline: David Rowley Letting your staff gain extra tax breaks from their sharesave scheme has got to be the biggest, most obvious reason for launching a group self-invested personal pension (Sipp). Once an employee has chosen to put...

Special Supplement: Group Sipps - The sky is the limit.
November 3, 2008... Byline: Owen Walker Long forecast, but only recently taken shape, the group self-invested personal pension (Sipp) market is fast becoming the biggest growth area in employee benefits. With the decline of defined benefit (DB) schemes...

Special Supplement: Group Sipps - Talking heads.
November 3, 2008... 1 - What distinguishes an employer that provides a group Sipp from one that doesn't? 2 - Can group Sipps work for schemes of all sizes? What limitations are there for smaller schemes? 3 - How has the recent economic turmoil affected...

Special Supplement: Group Sipps - Layer cake.
November 3, 2008... Byline: Nigel Aston We live in a culture where saving is discredited. The piggy banks that we used to give to our children have been replaced by top-ups for mobile phones. Official figures show that during the first quarter of 2008 the...

Special Supplement: Group Sipps - Company focus - A word from the sponsor...
November 3, 2008... Background At Standard Life, we want to change the way in which people think about benefits; how benefits can help businesses reward employees, and how employees can plan better futures. We believe we are showing the way forward by...

Special Supplement: Group Sipps - Each sipp is completely unique.
November 3, 2008... Group self-invested personal pensions (Sipps) are making headlines on an almost weekly basis, with large employers introducing this type of pension scheme for their employees. The question is why is this type of scheme becoming more and more...

Special Supplement: Group Sipps - Company focus - A word from the sponsor...(Company overview)
November 3, 2008... Background The Legal & General Group, established in 1836, is one of the UK's leading financial services companies. We are one of the UK's top 50 companies in the FTSE 100 Index. Over 5.8 million people rely on us for life assurance,...

Special Supplement: Group Sipps - Group Sipps: The final frontier.
November 3, 2008... Is the term group self-invested personal pension (Sipp) an oxymoron? The title contains two words that have, or seem to have, opposite meanings. What combines the 'self' with the larger 'group'? The history of pensions can be traced back...

Special Supplement: Group Sipps - Company focus - A word from the sponsor...
November 3, 2008... Background JPMorgan INVEST is part of JPMorgan Chase, a leading global financial services organisation. We have become the foremost provider of financial education in the workplace, with a formidable reputation at delivering real results...

Special Supplement: Group Sipps - The good ship Group Sipps.
November 3, 2008... The development of group self-invested personal pensions (Sipps) is one of the most interesting and significant trends in pension provision in the UK today. Within the space of just a few years, Sipps have moved from being high cost, specialist...

Special Supplement: Group Sipps - Company focus - A word from the sponsor...
November 3, 2008... Background Hargreaves Lansdown Corporate Solutions was established in 1999 and is now one of the UK's leading contract-based defined contribution pension consultancies, group Sipp providers, at-retirement service providers and a specialist...

Special Supplement: Group Sipps - A bigger share.
November 3, 2008... It was the great bard that penned: "I see you stand like greyhounds in the slips, straining upon the start. The game's afoot: follow your spirit, and upon this charge cry 'God for Harry, England, and Saint George!'" The students among you...

Special Supplement: Group Sipps - One idea.
November 3, 2008... Nigel Aston - Senior business development manager at Standard Life There are few employee benefits that enjoy the wide appeal of share plans. For sponsors, they offer high levels of engagement from a broad spectrum of employees. For...

Special Supplement: Group Sipps - Now it's time to take the plunge.
November 3, 2008... Byline: Philip Hutchinson In the increasingly competitive world of work, today's employer is under greater pressure to ensure the benefits they provide contribute directly to influencing employee behaviour, generate a maximum return on...

Special Supplement: Group Sipps - Company focus - A word from the sponsor...
November 3, 2008... Background Established in 1970 by our current chairman, Geoffrey Pointon, Pointon York Sipp Solutions has pioneered the way for self-administered pension schemes in the 1970s and 1980s. We are an independent Sipp specialist, focused...

News: Ruling opens floodgates on wind-up debt.
November 10, 2008... Byline: Tom Willetts Employer debts to schemes in wind-up could rise after a High Court judgment found that trustees can manipulate the process to maximise income. Solvent property firm Headway was taken to court by the trustee of its...

News: FSA instructs insurer to clarify OMO contract.
November 10, 2008... Byline: Charlie Kirby Abbey Life will change its open market option (OMO) contract wording after an undertaking by the Financial Services Authority (FSA). In what is the first undertaking of its kind, the FSA has called for Abbey Life...

This Week: Images speak louder than words.
November 10, 2008... 'Turgid crap' is how a leading figure at a pensions administrator sums up the legalese and pensions terminology that is obliged to be put in statements to scheme members. The administrator bemoaned how much better these statements could be if...

News: Bill's vague wording delays scheme plans.
November 10, 2008... Byline: David Rowley Pension schemes face planning blight because of the slow pace of clarification of exemptions rules for personal accounts, the GBP3.9bn Pensions Trust has warned. The multi-employer scheme for charities wants to...

News: Enron claimants to start receiving payouts in 2008.
November 10, 2008... Byline: Charlie Kirby Claimants in the long-running Enron dispute should receive payouts by the end of the year, according to the Goal group. A number of pension funds were caught out by the assisted fraud at the energy trading...

News: Self-certification plan leaves industry in doubt.
November 10, 2008... Byline: Tom Willetts The government has failed to quell unease over personal accounts despite unveiling a proposal to cut costs for employers running money purchase schemes. An amendment to the pensions bill will mean that employers...

News: Skandia on its own in abandoning ABI.
November 10, 2008... Byline: Charlie Kirby Pension providers won't be following Skandia in leaving the Association of British Insurers (ABI), despite differing views on areas of the retail distribution review (RDR). Skandia announced last week that it was...

News In Brief.
November 10, 2008... Earnings for the UK arm of Dutch insurer Aegon have dropped by 39% to GBP28m, according to its third-quarter report. The decline has been attributed to the impact lower equity and bond markets have had on fee charges in Aegon UK's pension...

News: CETVs must be reviewed as covenants weaken.
November 10, 2008... Byline: David Rowley Cash equivalent transfer value (CETV) exercises should be reconsidered in light of declining em-ployer covenants and lower fund values, stated Hamish Wilson. On October 1, trustees became responsible for...

News: Performance-related funding plans could help reduce deficits.
November 10, 2008... Byline: Tom Willetts Schemes seeking to reduce deficits should consider funding plans related to the performance of their sponsor, according to a consulting actuary. The interests of the trustees, company and the Pensions Regulator...

News In Brief.
November 10, 2008... The abolition of advanced corporation tax (ACT) relief for pension funds in the 1990s has caused more damage than this summer's market crash, according to the Tax Payers' Alliance (TPA). Terry Arthur, author of the report, said occupational...

News In Brief.
November 10, 2008... Employee benefits consultancy SBJ Group has bought EB Consultants, the specialist actuarial and pensions administration firm. "SBJ has demonstrated a clear vision of their developing future structure and capability," said Lynne Stewart,...

News: Pensioner buyout affordability steady.
November 10, 2008... Byline: Tom Willetts Falling asset values and increased corporate bond spreads have pushed up buyout prices, hitting schemes seeking to offload deferreds and pensioners hard. However, pensioner buyouts supported by derisking investment...

News: Scheme members look to transfer out.
November 10, 2008... Byline: Tom Willetts Aon Consulting saw a massive leap in enquiries from members requesting quotes to transfer out of schemes last month. The firm's administration team handled 74% more enquiries in September this year than in the same...

News: LSE-based project to focus on provision and longevity.
November 10, 2008... Byline: Tom Willetts Pension Corporation has launched an initiative with the London School of Economics (LSE) to produce research on pension provision and longevity. The project, Pensions Tomorrow, will involve regulators,...

News: Lack of disclosure may force govt's hand.
November 10, 2008... Byline: Tom Willetts Fund managers' poor disclosure of their voting records risks activating reserve government powers that make such practice mandatory, according to Fair-Pensions. The charity, which campaigns for major institutional...

News: Longevity tables for self-administered schemes.
November 10, 2008... Byline: Tom Willetts The Actuarial Profession has published mortality tables for self-administered pension schemes to give them a more accurate view of longevity. The tables are the first to be produced using data specifically from...

News: The savings crisis.
November 10, 2008... There has been much research on the public's lack of awareness that pension contributions get tax relief, but Zurich's estimate of 75% of people is quite shocking. The insurer came up with stats that show this figure peaks for those under...

Asset News: Variety club tops AIC performance figures.
November 10, 2008... Byline: Tom Willetts Global emerging markets and small UK companies are among the best performing sectors for fund managers. The Association of Investment Companies (AIC) also identified global growth, Asia-Pacific (excluding Japan),...

Asset News: Skilled managers required for private equity.
November 10, 2008... Byline: Tom Willetts The era when private equity managers could generate strong returns without a high degree of skill is over, according to a consultant. Watson Wyatt has warned that managers must apply consistent strategies to be...

News In Brief.
November 10, 2008... Some corporate bonds are trading at extraordinarily low values, according to Owen Murfin, fixed income fund manager at BlackRock. "Subordinated bonds issued by UK clearing banks are trading at around 45 pence in the pound and offering a...

In depth: The Pie's The Limit.
November 10, 2008... Workplace pensions: a long-term matter supposedly resilient in the face of short-term financial and economic storms. But given the events of the past few weeks, who in their right mind would want to invest in a communications campaign that...

In Depth: A period of dread for pension funds.
November 10, 2008... Byline: Lindsay Tomlinson In the last few weeks the whole financial world has changed. The western financial system has come close to collapse; financial power has visibly shifted eastwards; and unreconstructed Clause 4 IV socialists will...

In Depth: Personal view - Market turmoil shows that default funds need a structural overhaul.
November 10, 2008... Byline: Peter Ball Historically, deciding how much constraint to apply to your fund manager usually meant how much freedom to give them to deviate from a set benchmark index. Asset allocation was usually fixed, with set weightings given...

In Depth: Jargon buster.
November 10, 2008... IAS 19 The International Accounting Standard that sets out how to account for employee benefits. This has replaced FRS 17 for most UK listed companies. The principle behind it is that all employee benefits that have been earned...

In Depth: Technical View - Make managers work for their money.
November 10, 2008... Byline: Chetan Ghosh In most areas of life, we pay for services or goods based on the additional value we receive. We pay more for plasma televisions than the traditional box televisions, because the quality of the picture is greater and...

Industry Watch: Governance - Barclays' choice may give them the hump.
November 10, 2008... The shareholders are revolting. The decision of Barclays to seek funding from Middle Eastern investors as opposed to being part-nationalised by the UK government has provoked a rash of negative commentary in the financial press. In its desire...

Industry Watch: View From The Bridge.
November 10, 2008... Uncle Harold Two weeks' ago my Uncle Harold, who lives in a suburb of Boston, celebrated his 96th birthday. A week later, he voted for Barack Obama. Uncle Harold retired 35 years ago when he sold his handmade, knitted apparel shop in...

Industry Watch: Notice board - NAPF conference and training.
November 10, 2008... NAPF Trustee Conference: Understanding and controlling risk November 26, 2008 One Great George Street NAPF is delighted that the new minister for pensions reform, Rosie Winterton, will headline a programme of industry speakers at...

Pensions Workout: Advanced Level - Pension Surplus: Who's In Control? Advanced Level.
November 10, 2008... Complex accounting guidance, IFRIC 14, could materially change the way pension scheme surpluses are accounted for in company accounts. IFRIC 14 applies to companies that report pensions under IAS 19. Essentially, this means any public...

Special Focus: Introduction.
November 10, 2008... Hedging investment risk is often associated with swaps, derivatives and overlays, but the main article from Wellington Management International offers an ingenious approach to hedging risk by maximising opportunities from mainstream...

Special Focus: Friend Or Foe?
November 10, 2008... Byline: Matthew Craig Are pension fund trustees right to be sceptical over the use of swaps and derivatives as tools to protect pension fund assets? The sudden and dramatic global financial crisis of recent weeks may well have caused...

Special Focus: Defence Strategy.
November 10, 2008... Byline: Christophe Orly The painful and protracted process of global deleveraging is likely to heighten capital market volatility for many months to come. Amid this uncertainty, diversification is still a long-term investor's best defence....