Archive for December 2011

David Davison

Nearly 30 pension funds have filed claims at the High Court seeking damages from Henderson Global Investors over claims it took too much risk with one of its funds, the Henderson PFI Secondary Fund II, when it used the majority of the fund’s assets to buy John Laing, a firm with a large pension deficit.

The fund subsequently lost 2/3rds of its value, not least because of the pension scheme deficit. Now I’m not seeking to comment on this case specifically and indeed Henderson’s have signalled they “will vigorously defend these proceedings” but more on some wider pension related implications.

I would have expected that at least when conducting due diligence on the investment Henderson would at least have been aware of the existence of a defined benefit pension liability Read more »

Brian Spence

Our pensions review of 2011

A New Year and in January developments in de-risking throughout 2010 were discussed. How would 2011 fare in comparison?

February hosted a long and sometimes confusing conversation about PIPs. Turns out it’s simple,……… honestly!

In a busy month of March we aired our opinions and gave a spring clean to these pieces:

Help for schools and colleges showed we are no fools in April with some guidance on FRS17 disclosures.

The joys of spring were not abound in May as we lost an “f” in pensions. There never was one?  I think you’ll ind……..

Inflation and its effects were being discussed in June as another quarter sees the inflation targets go by unachieved. On a more positive note the Actuarial Profession was inflated with a new influx of talented graduates from Queen’s University. We were there to welcome them to the industry and indeed are nurturing some of that talent within our business today.

Individuality was the theme of July’s hot topics. Section 75 Regulations fail to recognise the plight of the unattached charitable organisations among multi employer schemes. And, as tPR guidance on Incentive Exercises suggests trustees start with the view that they will not be in the members’ interests, we ask just how much trustees should assume all members have the same needs?

In August we tried to make sense of babysitting pensioners and whether they were truly responsible enough to take care of their own finances.

September brought another egg to the NEST in the form of NOW Pensions as a rival. All good sport or will it be rotten?

November saw us pushing the limits of data management. Are Trustees using all the tools at their disposal to  improve their data and meet tPR’s  deadline?

December and we are back to de-risking and not much festive cheer. We feature our article in the Actuarial Post.

David Davison

Many leading charities will be reeling from the recent announcement from The Pensions Trust that they face significant shortfalls in a pension scheme which they had originally believed to be a defined contribution arrangement. The Growth Plan 3 (“GP3”), which for many charities was seen as a safe haven for fixed contributions and the provision of members AVC savings has now allegedly been impacted by the high court judgement recently handed down on the Bridge Trustees case and resulting legislation expected to be forthcoming from the Department of Work & Pensions (“DWP”).

This will undoubtedly be unwelcome news and cause major problems for around 500-600 organisations participating in GP3. Read more »

David Davison

I was kindly introduced to the word scotoma last week. The dictionary definition is ‘a mental blind spot; inability to understand or perceive certain matters.’ I would have found it difficult to find a better word to describe the on-going debate, and I use that word very loosely in this case, in respect of public sector pensions culminating in the strikes on 30th November.

Things have been moving at such a speed it’s hard to keep up and to pick out the fact from the rhetoric. The week of the strike began with a bit of school yard name calling as trade union Unite issued their “Dossier of hypocrisy” exposing the extent of cabinet minister’s pension entitlements. All that did was make the case that those particular public sector pensions need to be reformed as much as, if not more than, all the rest. Read more »

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