Analysis: Consultant attacks fund recovery plans.

Byline: Henry Smith

Many of the recovery plans drafted by underfunded pension schemes are "a fantasy", according to Dawid Konotey-Ahulu, a partner at investment consultants Redington.

Speaking at an investment conference hosted by Aviva Investors in London recently, he said: "There is the idea that by 2020 the pension scheme will have achieved self-sufficiency and when you look under the bonnet you see that there is no chance of that happening."

Pension funds, he added, needed to understand the way they allocated their assets and the risks they were buying.

"There are a lot of things that can and should be done like not putting all your money in equities and a day of reckoning is coming for those pension schemes that do not get it right."

Mr Konotey-Ahulu went on to say that the investment consulting industry had displayed a poor understanding of the risks faced by pension funds and done a "feeble" job of predicting the impact of the financial crisis as it had played out over the last nine months.

He said: "One thing I think consultants have recognised is that they need to get up the curve very quickly in the area of risk. For instance, do you rely solely on one measure of risk, or do you look to other measures like stress-testing. ...