February 2021
09Feb

U.K.’s Sunak to Protect Pensioners With Triple Lock Pledge

U.K. finance minister Rishi Sunak is planning to keep the government’s promise to increase the state pensions of millions of elderly people by at least 2.5% every year, saving a flagship policy despite the costs. According to a person familiar with the matter, the Chancellor of the Exchequer will retain the “triple lock” guarantee to raise the state pension by the highest of three measures: annual growth in average earnings, inflation, or 2.5%. Around 12.5 million people receive the pension. The...

February 9, 2021
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09Feb

UK govt pension liabilities surge £1.3trn in 3 years

The UK government's pension liabilities have risen 22 per cent in three years, raising questions about the sustainability of public pension schemes. According to figures from the Office for National Statistics, published yesterday (February 8), the government’s pension liabilities had surged by 22 per cent between 2015 and 2018, to £6.4tn. State pension liabilities amounted to £4.8tn, or 224 per cent of gross domestic product. Unfunded public sector defined benefit scheme liabilities stood at £1.2tn, or 55 per cent of GDP, while...

February 9, 2021
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08Feb

Simple error can leave Brits with £50,000 less than expected in pension pot

Millions of Brits are at risk of being caught short by over-estimating their state pension payments by up to £50,000, a consumer watchdog has warned. Research by Which? revealed three in 10 believe they will get thousands more through their retirement years because they have got their figures wrong. Only three in 10 knew the average weekly state pension is worth around £150 or £7.800 a year. But with guesses ranging from £175 to £200 a week or up to £10,400 a...

February 8, 2021
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05Feb

UK. FCA Launches Defined Benefit Advice Assessment Tool

Last month, the FCA launched its Defined Benefit Advice Assessment Tool (“DBAAT“) as part of its strategy to reduce harm to consumers and improve the suitability of defined benefit (“DB“) transfer advice. The tool will help firms to understand precisely how the FCA assesses the suitability of DB transfer advice. Background The launch of DBAAT comes in light of the FCA’s concerns that consumers are being advised to move their pensions out of DB schemes, despite the fact that...

February 5, 2021
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04Feb

UK. Pension scheme trustees challenged over climate change reporting

The new regulations will require occupational pension schemes to have – and report on – effective governance, strategy, risk management and accompanying metrics and targets for the assessment and management of climate-related risks and opportunities. A key requirement is that pension schemes report disclosure aligned with the taskforce on climate-related financial disclosures (TCFD) framework. Since an earlier consultation in this area, the government has announced its intention to make TCFD-aligned disclosures mandatory across the economy by 2025, with a...

February 4, 2021
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03Feb

PGIM Real Estate raises £190m to launch UK Affordable Housing Fund

PGIM Real Estate has launched its UK Affordable Housing Fund, with an initial capital raise totaling £190 million, from the Northern LGPS and Brunel Pension Partnership. The open-ended income-focused UK Affordable Housing Fund targets a total return of 6-9% per annum, net of fees and costs, by investing in and developing affordable homes for working people and families across the UK. The Fund is also able to leverage, giving it the potential to deploy up to £250 million at...

February 3, 2021
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03Feb

U.K.’s Sunak to Protect Pensioners With Triple Lock Pledge

U.K. finance minister Rishi Sunak is planning to keep the government’s promise to increase the state pensions of millions of elderly people by at least 2.5% every year, saving a flagship policy despite the costs. According to a person familiar with the matter, the Chancellor of the Exchequer will retain the “triple lock” guarantee to raise the state pension by the highest of three measures: annual growth in average earnings, inflation, or 2.5%. Around 12.5 million people receive the...

February 3, 2021
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02Feb

U.K. firms sponsoring DB plans comprise big chunk of profit warnings

Almost two-thirds of listed companies sponsoring defined benefit funds issued a total 249 profit warnings last year, accounting for 43% of all U.K. profit warnings made in 2020. The latest EY quarterly analysis of profit warnings found that 10% of those firms with a DB fund issued their third consecutive profit warning in 2020 — often a precursor to insolvency. EY analysis shows that, typically, 1 in 5 firms issuing three warnings within 12 months will become insolvent within...

February 2, 2021
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01Feb

UK. Corporate bonds could offer ‘untapped potential’ for sustainable pension investments

Corporate bonds could offer “untapped potential” for improving the sustainability of investments, despite a "notable" absence of sustainable-labelled buy and maintain corporate bond strategies, analysis from LCP has found. The firm explained that with defined benefit (DB) pension schemes gradually maturing and de-risking, holdings of bonds are set to increase, with many companies using the corporate bond market to raise cash as an alternative to issuing new equity at the same time. This in turn has seen a “steady flow” of...

February 1, 2021
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01Feb

UK. Smart Pension commit to move away from fossil fuel investments

Smart Pension has today (February 1) committed to halving its scheme emissions before 2030.  The prominent UK master trust has signed up Make My Money Matter, a campaign which is fighting for a world where we all know where our pension money goes. There is currently over £3 trillion in UK pensions, and this money which is owned by all of us is invested to build our savings for the future. But many of us do not know where this money...

February 1, 2021
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