July 2017

04Jul

UK. 1 million to opt out of pension in 2019

A million people will choose to miss out on crucial retirement saving in 2019, Government figures predict. This is despite the fact that auto-enrolment will be fully in place by then, at least for all employees that meet the current criteria. We've taken a closer look. The figure is based on the current percentage of members who have opted out of their workplace pension schemes, which is 10%. This is estimated to increase to 21.7% in 2018 and 27.5% in...

July 4, 2017
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03Jul

UK pension consultants prepare for era of no-nonsense

They kept a low profile as banks and other pillars of the finacial services industry were upbraided by regulators. Now the consultants who influence how trillions of pounds of pensions are invested are finally under pressure. Any hopes the industry had of avoiding a full-scale antitrust probe were dashed last week by the City watchdog. Dominated by three big players - Mercer, Aon Hewitt and Willis Towers Watson - consultants had avoided the gaze of the Financial Conduct Authority (FCA), despite...

July 3, 2017
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June 2017

29Jun

Regulation, red tape, sometimes necessary as Grenfell and BHS prove in different ways

How often have you heard politicians, especially low-rent Conservative politicians, banging on about red tape? If we just took up our scissors and cut through the lot of it then the British economy would surge off into the stratosphere, leaving those of our (former) EU friends in the dust! We'd be richer and happier as a foggy Asian tiger! Now, if we could just get the flights over there sorted out. Better get Boris Island built in the Thames estuary. With...

June 29, 2017
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28Jun

UK. 38% believe workplace pensions are the safest way to save for retirement

More than a third (38%) of respondents aged under 40 years old or aged 40 and over who have not yet retired believe that a workplace pension scheme is the safest way to save for retirement in the period July 2016-December 2016, according to research by the Office for National Statistics (ONS). Its Early indicator estimates from the wealth and assets survey also found that 68% of respondents who have not yet retired cite an occupational or personal pension as...

June 28, 2017
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26Jun

UK. New solutions needed for defined benefit pension schemes

The Cass Pensions Institute says new solutions are needed in stressed defined benefit pension schemes to prevent intergenerational inequities. The Institute has responded to the Department of Work and Pensions Green Paper, Security and Sustainability in Defined Benefit Pension Schemes. The Greatest Good 2 paper follows up and reconfirms the findings of an 2015 Pensions Institute discussion paper which found that 1,000 occupational defined benefit (DB) pension schemes are stressed as a result of having financially weak sponsors. Professor David Blake, Director,...

June 26, 2017
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23Jun

UK. ‘Triple lock’ is unsustainable, says new Pensions Secretary David Gauke

The pension triple lock is no longer a sustainable policy, the new Work and Pensions Secretary has insisted. David Gauke said the mechanism would remain until 2020, but would then be "reflected" on. The Conservative manifesto pledged to abandon the triple lock on state pensions rises, which sees the state pension rise in line with either wages, inflation or earnings - whichever is highest. However, the flagship pledge was not mentioned in the Queen Speech after the Prime Minister failed to secure...

June 23, 2017
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23Jun

Global Pension Risk Survey reveals UK progress on de-risking

The biennial survey saw responses from 185 UK schemes, with 4.5 million members and £500 billion of assets. Most apparent among the findings was the growing appetite for de-risking and the increasing range of actions being taken. Matthew Arends, partner at Aon Hewitt said: “The UK findings of this year’s Aon Global Pension Risk Survey report that just 4% of respondents had implemented an Integrated Risk Management (IRM) plan with actions, and 46% either had no IRM plan or had...

June 23, 2017
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22Jun

UK. Silence on pensions in the Queen’s Speech was a big mistake – Theresa May should have stuck to her instincts

Wednesday's Queen’s Speech was a pot-holed, broken reflection of the manifesto the Conservative Party stood on just two weeks ago. Thankfully a number of the manifesto’s egregious policies didn’t make the Queen’s final pages, but, more problematically, a number of its good ones also felt the executioner’s touch. None more so than the brave changes Theresa May had proposed on pensioner benefits and care. Proposals to means-test the universal winter fuel payment, scrap the triple lock on pensions, and the...

June 22, 2017
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21Jun

UK’s Ageing Workforce Will Decide Our Future After Brexit

Here are some numbers for you to conjure with. In the 10 years to 2022, some 12.5 million jobs will be opened up in the UK through people leaving the workforce, mostly through retirement or ill-health. Over the same period an estimated two million new jobs will be created, given a fair economic wind. Yet based on the number of young people reaching adulthood, just seven million will enter the workforce. Even allowing for the vagaries of economic forecasting,...

June 21, 2017
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21Jun

UK. DB transfer paper shows FCA ‘moving into 21st century’, say advisers

The Financial Conduct Authority (FCA) consultation paper on advising on defined benefit (DB) pension transfers has brought the regulator's approach into the 21st century, according to advisers. The paper proposed a number of vital changes to regulation on DB transfers so as to mitigate the risk posed to consumers of giving up safeguarded benefits. These included removing the default position that transferring out of a defined benefit scheme was 'unsuitable' for a client, clarifying the definition of an 'insistent client', and...

June 21, 2017
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