November 2020

27Nov

U.K. clarifies timeline for reform of inflation measure

Investment consultants and the Pensions and Lifetime Savings Association welcomed clarity over the future use of the retail price index to calculate U.K pension benefits and liabilities, but warned that the change will still be detrimental to participants. Chancellor of the Exchequer Rishi Sunak announced Wednesday that the RPI calculation of inflation will be reformed to bring it into line with another measure of inflation — the consumer price index — starting in 2030 at the earliest. The change...

November 27, 2020
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27Nov

UK. State pension rise will go ahead in 2021

State pensions will rise by 2.5 per cent next year, the government has announced. In her statutory annual review of benefit and State Pension rates, Therese Coffey, secretary of state for work and pensions, confirmed the state pension hike, in line with the government’s manifesto commitment not to tinker with the triple lock. The new rates will come into effect on April 12, 2021 and apply to the 2021/22 tax year. She said: “The Social Security (Up-rating of Benefits)...

November 27, 2020
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26Nov

UK. Millions face cut in value of workplace pensions

Millions of retirees will see the future value of their pension cut owing to a planned change in the way payments are calculated from 2030. Many of those with so-called defined benefit workplace pensions see their pension payments increase each year in line with the rising cost of living. Read also U.K. clarifies timeline for reform of inflation measure The way this annual rise is calculated is expected to become less generous from February 2030. Chancellor Rishi Sunak ruled out...

November 26, 2020
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20Nov

UK pension funds urged to step up infrastructure investing to boost long-term economic sustainability

A recent report by PwC found that the UK will need to increase infrastructure spending to GBP40 billion a year, double the current level, in order to reach its target of net zero by 2050. “In the UK, investment in infrastructure by long-term investors is minuscule,” said Nick Silver, co-founder of the Climate Bonds Initiative, at the World Pensions Council event. Pension funds allocate on a risk-return basis, and have historically shown a strong preference for liquidity – leading...

November 20, 2020
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19Nov

UK. More Consumers Than Ever Are Managing Their Pensions Online

New figures from the UK’s leading online pension provider, PensionBee, show that consumers are increasingly managing their pensions online, following a 96% increase in PensionBee app users, as well as an 85% growth in the number of invested customers year on year. PensionBee, the UK’s leading online pension provider, has experienced an 85% increase in the number of invested customers over the past year. Invested customers, defined as having pension assets in a PensionBee plan, currently number around 60,000....

November 19, 2020
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18Nov

UK. PensionBee mulls float on stock exchange

Pension consolidator PensionBee is seeking to float on the London Stock Trade in a transfer which can see it valued at £300m or extra, based on experiences. In keeping with The Occasions, the digital consolidator is looking for bank advisers for the float and plans to make an appointment earlier than Christmas. Romi Savova, founder and chief govt of PensionBee, advised the paper that robust efficiency in current months had accelerated plans to show PensionBee right into a public...

November 18, 2020
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17Nov

UK. MPs jeopardising pension security without further bill amendments, Altmann says

Speaking ahead of the final Pension Schemes Bill session in the House of Commons next week, Altmann said changes "could make or break" private pensions. The government and regulators have "chosen to remove important amendments passed by cross-party peers" Altmann said, which were "considered crucial to helping defined benefit (DB) schemes to remain open". "The Lords debates highlighted concerns from many open schemes that the new funding code, recently consulted on by The Pensions Regulator, poses an existential threat...

November 17, 2020
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13Nov

UK pensions regulator warns on employer insolvency

The trustees of British defined benefit - or final salary - pension schemes must be ready for possible employer distress or insolvency to protect their members as COVID-19 impacts the economy, the country's pensions watchdog said on Thursday. "Trustees are the first line of defence for savers," Mike Birch, director of supervision at The Pensions Regulator said in a statement. "The faster they act, the more options and greater time they'll have to protect members' retirements. Trustees should know...

November 13, 2020
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12Nov

UK regulator urges united front on pension scams

The initiative - launched on 10 November with support from the Pension Scams Industry Group (PSIG) - encourages providers, advisers and pension scheme trustees to support a pledge to take all possible action to reduce and protect members from scams, and includes clear guidance around appropriate due diligence and best practice. The watchdog is calling on the industry to publicly pledge their support for the initiative. According to Action Fraud, more than £30m has been lost to pension...

November 12, 2020
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11Nov

U.K. deficits worsen in October as COVID-19 resurgence bites

The total deficit of U.K. defined benefit funds covered by the Pension Protection Fund's 7800 index increased 1.3% in October, to £168.2 billion ($217.7 billion). The deficit was £166.1 billion at the end of September. Deficits also worsened for the year ended Oct. 31, from £74.3 billion, said an update Tuesday by the London-based PPF. The PPF is the lifeboat fund for the defined benefit plans of insolvent U.K. companies. The funding ratio of the corporate pension plans worsened...

November 11, 2020
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