Media Releases

Laura Cumming

The Spence team has sifted through all the industry changes and trends from the last quarter, picked out the highlights and condensed it into a snappy report for you to download. Each update briefly summarises what you need to know, and clearly sets out the actions you need to take, saving you hours scouring through multiple reports, press releases, blogs and articles.

Some key updates to keep an eye out for are:

  • HMRC’s vital VAT judgment; this could see schemes recover VAT on investment management costs
  • PPF levy costs; the PPF’s recent announcement on the 2015/16 levy is fundamental to your scheme’s PPF levy cost
  • Contracting Out; make sure you are keeping in line with the HMRC’s most recent update to ensure you are ready for the abolition of contracting out.

Download your copy of the Pensions Quarterly Update report here.

If you have any questions, please don’t hesitate to get in touch with your usual contact or the Spence team.


Alan Collins

Spence & Partners, the UK pensions actuaries and administration specialists, today announced their appointment by the Leighton Opticians Pension Scheme for their fully integrated DB scheme management service. The service includes actuarial, consultancy, administration, payroll, treasury and accounting functions.

Laura Cumming, Consultant at Spence, commented: “The Trustees of the scheme were very clear from the outset that developing an integrated approach to managing their scheme was crucial to handling both their ongoing commitments and planning for the future. As our technology platform provides immediate access to funding information, based upon live administration and investment data, the trustees will be able to become much more proactive with funding decisions and scheme management plans.

“Combining everyday functions with funding information allows all scheme activity to be run from the same base. This removes one of the unnecessary elements of modern advisory services – the transferring of data cuts for funding calculations. This is an outdated and lengthy process for a modern industry that no longer fits with the needs of schemes to act quickly and decisively.” Read more »

Peter Scott

The Future Influencers celebrated its one year anniversary with an event in one of @Waterloo’s Alice in Wonderland inspired rooms. Although the Mad Hatter was unavailable, luckily, we had the next best thing, with Angela taking the role of chairperson. In true future influencers tradition the meeting was attended by a mix of familiar faces from prior events and several new attendees brought along by colleagues to join the discussion for the first time. As one of the first time attenders myself I can attest to the welcoming nature of the group and I look forward to coming along to many more in future. Read more »

Alan Collins

First published in PMI News, December 2014

With 2014 bringing about remarkable changes for the UK pensions industry, the spotlight on sponsoring employers has never been brighter – so what are the major issues companies need to tackle in the new pensions world? We discuss the impact of recent announcements around staff communications, the move to collective defined contribution (DC) proposals and the code of practice implications on involvement in scheme funding – perhaps bringing de-risking back into focus for many employers. With non-compliance and errors in automatic enrollment set-up at high levels, as well as the staging of increasingly smaller firms, this issue remains firmly on the table for many as well.

Download The December PMI News Article

Marian Elliott

Spence & Partners, the UK pensions actuaries and administration specialists, today announced the  launch of their new, fully integrated and tailored scheme management service for Defined Benefits  (DB) pension schemes.

Marian Elliott, Head of Trustee Advisory Services at Spence, commented: “Running a DB scheme  isn’t easy.  Trustees are asked to decipher information about the covenant, investment strategy  and actuarial funding–often produced at different times, from different sources and with no clear  link between them. Added to this, they are often also dealing with inaccurate and incomplete data  and poorly-defined benefit structures, leading to the wrong decisions being made.

“To help trustees cut through these complexities, provide them with co-ordinated risk management  and to get them from where they are now to where they want to be, we have developed a fullyintegrated approach to better scheme management, combining leading-edge technology and  specialist knowledge. This solution is revolutionary and, we believe, unique in the market. It  moves away from multiple databases – one for actuarial work and another for administration  records and uses a single database containing up-to-date live member data to manage the scheme and automate all administration and actuarial calculations.  Read more »

Alan Collins

Spence and Partners, the UK pensions actuaries and administration specialists, today announced the appointment of Richard Smith as Consulting Actuary.  Smith will have a UK wide focus and service clients across Spence offices in Glasgow, London, Bristol and Belfast.

Commenting on the appointment, Alan Collins, Head of Corporate Advisory Services at Spence and Partners, said; “As an organisation we are dedicated to helping guide and empower clients to tackle the demanding challenges they face when running their schemes. This has never been more prevalent following the changes announced in the budget this year and those that lay ahead in implementation, not to mention any impacts surrounding the 2015 election. We continuously strive to enhance our own expertise to benefit our clients and the appointment and retention of expert staff is key to that.  Richard is an experienced and talented advisor and as our business continues to grow throughout the UK, his broad spectrum of expertise will further enhance our service and deepen our relationships with both our sponsoring employers and trustee clients.”

Prior to joining Spence and Partners, Richard formerly held senior posts in Aon Hewitt and Towers Perrin and has a high level of experience working with trustee boards of FTSE 100 and other global multinational companies. He has advised clients on a range of pensions change projects including switches from Defined Benefits to

Defined Contribution and Career Average Revalued Earnings (CARE), benefit changes resulting from M&A activity, high-earner taxation issues and the implementation of the new employer duties surrounding automatic enrolment.

Michael Lallali

This was our fourth Future Influencers event and not only did many of the attendees at this event also attend our first, people have helped the events grow and invited their colleagues along. As with earlier events we also continued to welcome new faces from other sources too. It is really pleasing to hear positive comments about these events, with many people commenting that there is nothing else targeted at this level of audience, where we can all come together and broaden our knowledge. This was also the first event following the Future Influencers becoming CPD accredited, recognising the quality of the subjects that have been presented. Read more »

Alan Collins

Welcome news from the PPF

Spence & Partners latest blog for Pensions Funds Online –

Last month I talked about how the Pension Protection Fund (PPF) has improved processing times and introduced expert panels from across the pensions industry to implement continuous and appropriate improvement for schemes throughout the assessment process.

Well, the PPF have been in the news again this week following the results of this year’s consultation. So what were the highlights and how will it affect the industry?

Scheme trustees and sponsoring employers will have received some comfort from the PPF’s announcement regarding the 2015/16 levy. For example, the PPF intends to collect £635m in 2015/16, around 10% less than the estimated intake for 2014/15 (invoices for which will have been issued for most schemes in the last few weeks) which will be a relief to many.

This lowered estimate filters through to the levy calculation, where the Scheme Based levy for each scheme will be more than 60% lower (all else being equal) and the Risk Based Levy (usually the significantly higher of the two) will be around 11% lower (again all else being equal).

Another welcome result comes through an easing in the PPF’s interpretation of Asset-Backed Contributions (ABCs). The latest update confirms that all forms of ABCs will count towards reducing the levy, “provided the ABC is valued in a way that reflects the value to the PPF in the event of insolvency”. Although an annual valuation of the asset is required, potentially increasing the cost of holding it, ABCs will still be a very effective PPF levy management tool for those schemes and employers which enter in to such agreements.

Further comfort should also be sought by the PPF’s confirmation that they will consult on the issues raised around mortgage ages, and how recently the secured debts were taken on by the employer. Previously this resulted in some very negative outcomes for employers who had re-mortgaged loans, but the PPF has committed to finding a solution that means this (and associated charges unlikely to affect solvency) will not unfairly increase the levy.

With these improvements there still comes a warning for schemes to keep their houses in order. Mitigating your levy is still a vital action to be taken, especially as the 31 October deadline approaches for setting next year’s levy. For small and medium-sized employers there is a risk that the recent move from D&B’s scoring system to Experian will adversely affect their score around insolvency risk measurement – so I would suggest all trustees and employers check their current score now and do whatever they can to reduce this before the deadline.

No matter your thoughts on the levy, it is here to stay. The good news is that the PPF are taking steps to accommodate the changing ways that pension schemes are run, and how and where they invest their assets. There is however still a great responsibility on trustees and employers to maintain their focus. Monitoring your levy and taking all necessary steps to reduce it where possible, many of which are simply around meeting deadlines and providing appropriate documentation, is still the best way to reduce the cost to your scheme.

Pension Funds Online

Rebecca Lavender

PRESS release: 09 OCTOBER 2014

Spence & Partners, leading actuarial advisers to the charitable and social housing sector, has launched an online calculator and Guide to help organisations assess the likely impact of the introduction of FRS102.

David Davison, Head of Public Sector, Charities and Not-for-Profit Practice at Spence & Partners commented: “The introduction of the new pension reporting rules will require organisations to fully disclose their multi-employer pension scheme liabilities in their annual accounts, many for the first time.  We have launched this online calculator to help organisations as they try to get a handle on this new pension scheme accounting standard and identify what the likely position will be for them. This will be a challenge, particularly for charities in multi-employer schemes, who up until now only needed to record the value of their DC contributions.

“The calculator will allow schemes to enter their deficit recovery contributions and recovery period and obtain an estimate of the net present value figure* they’ll likely have to include on their balance sheet. Based upon this, the calculator will also provide a proxy figure for a full disclosure equivalent to that currently derived under FRS17**. This will help charities and other organisations participating in multi-employer schemes see the potential financial impact of disclosure early on and help them plan any steps needed to protect the balance sheet position. The steps could be relatively straightforward, but for others, particularly those where this change could have a material impact on their balance sheet, more bespoke action could be required. Charities, for example, might like to consider designating funds in the next financial statements to cover any agreed deficit reduction payments to minimise the effect on free reserves when FRS102 comes into effect.”

Davison added: “Although FRS102 only comes into force for accounting periods on or after 1 January 2015, the information and planning required means the issue should really be being considered now. The calculator will allow multiple calculations to be carried out and it can also be saved and printed. We believe it, and our technical guide, will provide access to a valuable resource for charities to better understand their obligations.”

The calculator can be found here The technical guide which explains the technical details of the new accounting disclosures and the key choices charity financial directors are likely to face is also available at

* The value of outgoing cashflows, discounted back to the present date, using a discount rate

** An accounting standard used to assess the balance sheet impact and pension costs associated with the operation of occupation pension schemes

Susan McFarlane

Spence & Partners, the UK pensions actuaries and administration specialists, have said that today’s announcement on the continued permission for DB to DC transfers should be a catalyst for trustees and scheme sponsors to work more closely together.

Marian Elliott, Head of Trustee Advisory Services at Spence, commented: “Immediate actions for trustees will be in communicating the outcome of these announcements to members and liaising closely with the administrators on the processes that will be needed to comply with the guidance guarantee. Trustees should also be prepared to collaborate with employers on any de-risking exercises that take place and consideration should be given to whether scheme design is affected by the announcements.

“Trustees should also monitor what impact the announcements may make to the scheme’s risk profile, should a significant number of members opt to transfer out. Trustees should not react by overhauling their strategy, however more consideration should be given to liquidity issues and funding monitoring, so that trustees can react quicker to the need for strategic adjustments. Other considerations for schemes will be around whether assets are sufficient to meet the needs of the potential increase in transfer requests on the back of this announcement, as this may involve an agreed funding top up with the sponsor.”

Alan Collins, Head of Corporate Advisory Services, added: “The announcements today should be welcomed and treated by employers as a trigger for positively managing their scheme liabilities. With the prospect of DB members looking to move to the far more flexible defined contribution market, employers should review their on-going plans for the scheme and target available resources to fund transfer exercises. Defined benefit schemes continue to present a significant risk to employers, but with this announcement building on recent easements in The Pension Regulator’s approach to funding, employers can start to manage that risk more effectively.

“More individuals have been contacting administrators to request transfer quotations since the proposals were first announced in the budget, so it is important that everything is managed correctly by the employer and scheme from the outset. I welcome the requirement for mandatory indpendent advice on DB to DC transfers. The time is right for employers to work with their trustees to make sure that this advice is on tap for all members making decisions in relation to their scheme benefits.”

Marian Elliott

Spence & Partners, the UK pensions actuaries and administration specialists, today said that The Pensions Regulator’s (TPR) new Code of Practice will mean advisers will have to go further in their efforts to advise trustees, by collaborating to present big picture advice and refining their processes and use of technology to deliver cost effective monitoring solutions.

Marian Elliott, Head of Trustee Advisory Services at Spence, commented: “By putting the covenant at the centre of the scheme’s decision making, the Code is essentially crystalising current best practice and encouraging trustees to adopt an integrated approach to risk management. This decision making and planning structure makes complete sense, as the covenant is the main driver of risk in the pension scheme. Investments can underperform, life expectancy can increase, the funding position can worsen – but the only circumstance in which members don’t get their full benefits is if the company can’t weather this negative experience.

“There will certainly be challenges in some sectors however. For trustees of smaller schemes, where budget and time to spend on governance is constrained, the requirement to obtain detailed covenant advice or to carry out asset liability modeling or stress test their strategies may mean they are spending more in this area. This is a good thing though, as the spend on advice to implement and monitor a sensible, coordinated approach to risk taking is far more valuable than spending too much on number-crunching ‘compliance’ work.

“For trustees of schemes with weaker sponsors, there will be a need to justify any investment risk taken or put in place contingency measures, which may result in more prudent investment strategies and higher deficit figures – leading to increased reliance on sponsor contributions for already weak employers. This will be a really difficult, but important, balance for trustees to strike.”

Elliott continued: “Whilst the Code is relatively lengthy, we would urge trustees to engage with this. It is absolutely the right way to think about risk management and should result in better outcomes for members and a better understanding from trustees and sponsors of the issues they need to overcome in order to get their scheme to a fully funded position. There is also no reason why the Code should present any difficulty for trustees, as with the right advice this integrated approach shouldn’t result in significant additional cost – and will almost certainly help make their decision making and monitoring processes a lot clearer.”

Brian Spence

Spence & Partners, the UK actuaries and administration specialists, today announced that Marian Elliott, Director and Head of Trustee Advisory services at the firm, has been awarded the prestigious International Association of Consulting Actuaries (IACA) Young Actuary High Achievement Award at the International Congress of Actuaries held in Washington D.C. this month.

Brian Spence, Founder of Spence & Partners, commented: “Marian thoroughly deserves this international recognition as she has made a significant contribution to the UK pensions industry, to her clients and the Actuarial Profession as a whole – all in a relatively short space of time for a young Actuary. Marian’s dynamic, pragmatic and enthusiastic approach to actuarial work is highly regarded by clients and industry professionals; and she highlights the positive impact a strong Actuary can have on a Scheme.” Read more »

Alan Collins

I am a scheme actuary to a defined benefit scheme in the UK and later today I will complete the formal results of a triennial valuation.

Not that unusual, you say? Well, what if I said the valuation date was 31 March 2014?

That’s right – not months, not weeks…one day. Our valuation system produces real results, based on real data, every day. Yes, we know you won’t need figures every day but they are there if and when you need them. The system allows trustees, sponsoring employers and investment managers to take immediate action based on up to date market conditions. Read more »

Marian Elliott

Spence & Partners, the UK pensions actuaries and administration specialists believe that, in opening his budget briefcase, George Osborne has unlocked Pandora’s Box for occupational pension schemes and has thrown the governance of DB schemes into a state of flux.

Marian Elliott, Head of Trustee Advisory Services at Spence, commented: “The Government recognises the risk of members transferring out of DB schemes into DC schemes and is looking at a range of possible restrictive measures.  The impact of the announcements for DB schemes depends almost entirely on the outcome of the consultation regarding the restriction of transfers between DB and DC Schemes. Read more »

Marian Elliott

Spence & Partners, the UK pensions actuaries and administration specialists, today said that schemes should be in a position to react to changes to their funding position on any day, making the idea of only reviewing funding strategy at a triennial valuation date an outmoded concept.

Marian Elliott, Head of Trustee Advisory Services at Spence, commented: “With many schemes looking to implement a de-risking strategy or dynamic asset allocation strategy, there is a need for more accurate and up to date information. We are therefore supportive of the recent view from PWC that the Regulator’s objective to complete the valuation report within 15 months of the valuation date is too long a period – but we would actually suggest that schemes and advisors could go much further than simply cutting this time down as suggested.

“Trustees and sponsors need greater clarity to be able to make timely decisions with regards to changes to the funding strategy and need to be able to seek out opportunities based on up to date information and by assessing the current economic situation. The data being used should be accurate and the best technology in the market should be able to turn this into a full analysis of scheme funding on the spot – why settle for anything less than that?  Our actuarial administration system already provides figures ‘on tap’, so that funding and investment decisions can be made at any time.”

Elliott continued: “We believe all-year-round governance is the way forward and that there is no reason not to be able to use the latest technology in terms of data management and actuarial modelling in order to deliver this. As well as greatly reducing unnecessary time and advisor costs for number crunching, this approach also brings clients more into line with TPR’s requirements on the monitoring of funding plans and makes them far more reactive to funding and de-risking opportunities.”


Telephone System Upgrade

We will be making an upgrade to our telephone system on Monday 27 January 2014.  While we have planned for the transition to our new system to be as smooth as possible, callers could experience some difficulties in reaching us from 08:00 to 12:00 on that day.  If you do encounter any problems, please try contacting us using our central email address

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