August 2018

UK. Pensions watchdog forced to drop fines against fund trustees

The Pensions Regulator (TPR) admitted in an update published this month that the penalties were revoked between April and June this year. The sanctions were slapped on trustees for producing inadequate reports for members setting out how they are governing savers’ money, including explaining costs and charges. TPR admitted in its report that it revoked the 74 fines in the period “due to a time delay on our part in explaining to schemes why their statement was not compliant with the...

UK. Victims of pension scammers lost an average £91,000: UK regulators

Pension scam victims lost £91,000 each on average last year, according to new figures from the City watchdog and the pensions regulator. The Financial Conduct Authority (FCA) and The Pensions Regulator (TPR) have teamed up to launch the ScamSmart advertising campaign, which is aimed at pension holders aged between 45 and 65 as they are most at risk of losing their cash. According to the regulators, highly sophisticated scammers lure people into transferring their pensions into fraudulent schemes. Victims of pension...

Collapsed UK retailer BHS pension scheme secured by $1 billion insurance buyout

The pensions of 9,000 employees of collapsed British department store chain BHS were secured on Sunday after a specialist insurer announced an insurance buyout of the firm’s ‘BHS2’ scheme covering 800 million pounds ($1 billion) of liabilities. Pension Insurance Corporation said the buyout left members of the scheme, which was set up in 2017 following BHS’s collapse and a cash injection by former owner Philip Green, fully insured and certain to receive benefits under the scheme. A pension insurance buyout involves...

UK pension funds could face legal action over climate risk, ClientEarth warns

ClientEarth has written to 14 of the UK's biggest pension funds warning they could face legal action unless they properly take account of risks to their investment portfolios posed by climate change. On Friday the green lawyer organisation wrote to the Shell Contributory Pension Fund, as well as the staff pension schemes of Tesco, Aviva, Lloyds Bank and HBOS, highlighting its "concern that a failure to think strategically about climate change may create risk for beneficiaries". "We are concerned that you,...

UK. Pensions dashboard to be debated in Parliament

“The dashboard really needs to happen if the government wants people to save enough for a decent retirement income. We can’t stop pensions being confusing and a turn off but we can make it easier to get all the information in one place and that would surely help. "The practical difficulties are not to be underestimated and occupational schemes are struggling to improve their own data quality. However, if the risks are to be transferred to individuals then we have...

UK. Pension transfers could cost members £2,600 over expected lifetime

Pension members choosing to transfer out of their employer’s scheme could receive an income that is £2,600 lower over their expected lifetime, according to research by XPS Pensions Group. The report, Member Outcomes Under Freedom and Choice, published today (7 August 2018), looks at data on defined benefits (DB) scheme transfers, collated by XPS Administration over the period since 2016. The research also found: Depending on the choice of retirement vehicle chosen to receive a transfer, an individual could run out of...

UK pension industry faces transparency inquiry

As Australia’s superannuation industry undergoes its own grilling at the Royal Commission, the UK Government has announced the Commons Select Committee will hold an inquiry into pension costs and transparency. The inquiry would examine whether the pensions industry provides sufficient transparency around charges, investment strategy and performance to consumers. It comes off the back of the Committee’s recent inquiry into pension freedom and choice, which found that some scheme members were being “shamelessly bamboozled” into signing up to unsuitable ongoing adviser...

UK Financial services exports to the EU reach a record high

UK exports of financial services to the EU reached an all-time high of £25.9bn in 2017, according to data released today by the Office for National Statistics. A £3.5bn increase in the surplus on financial services was the largest driver of the UK’s services surplus last year. By destination, Europe was the largest contributor to the improvement in the financial services trade balance, with a £26.5bn surplus accounting for £2.9bn of the headline gain. The record high on financial services exports...

UK. Calls for HMRC to scrap rule penalising parents’ pensions

The taxman is under pressure to ditch a rule that costs busy new parents thousands of pounds in state pension entitlement. Parents who have taken time out of work to raise their baby get just three months during the frantic first weeks of having a newborn to register for child benefits with HMRC, allowing them to continue to build up their state pension though they are not employed. Those who failed to do this have already missed out on as much...

July 2018

UK. Rush to cash-in small pensions will leave thousands below ‘acceptable’ retirement income, warns Just Group

Cashing in small pension pots early to rely on State benefits in retirement could leave many thousands of people struggling to achieve an acceptable income in later life, suggests new analysis by Just Group. The warning comes following the publication of Minimum Income Standards (MIS) by the Joseph Rowntree Foundation (JRF) reflecting the public’s views on how much weekly income is needed to achieve a minimum acceptable standard of living in the UK today. The JRF’s 2018 report suggest the MIS...