What constitutes a money purchase benefit could have wider implications for the administration of pension schemes explains Jeremy Goodwin, Eversheds
There has been a lot of fuss in the pensions press recently about whether something is or is not a money purchase (ie defined contribution – DC) pension scheme. It is tempting to see this issue as a mere technical point – something for pension lawyers and actuaries to debate perhaps...
Denmark can teach the UK a thing or two about running large scale, affordable pension schemes says Lars Rohde, NOW: Pensions
With increasing life expectancy, falling birth rates and interest rates, the challenge of establishing an affordable and sustainable pension system is high on the agenda of many European governments.
The taxpayer cannot meet this challenge alone and, for most countries, the private sector will have...
Why behavioural finance matters and why it matters to Nest by Cathy Smith, Allianz Global Investors, and Helen Dean, Nest
Did you know that seeing a picture of yourself as you might look in 20 or 30 years could actually cause you to double your savings rate?
Most people find it difficult to imagine the future, let alone picture themselves living in it. But that is exactly what we ask people to do when they plan for...
We must get people saving, keep them saving and make sure their savings grow quickly urges Mark Fawcett, Nest
For those in the pensions industry, it is easy to make assumptions about the general population’s knowledge levels when it comes to workplace pension schemes. But research has demonstrated that some of these assumptions are open to question.
In 2006, a study1 of Wharton MBA and Harvard...
The introduction of an optional waiting period will ease the administrative burden for some employers explains Mark Folwell, Lane, Clark & Peacock
In our previous articles we have covered which employees have to be auto-enrolled, when they have to be auto-enrolled, into what type of scheme and the minimum quality requirements for the scheme.
The good news for employers is that in late 2010 the government introduced some welcome easements to...
Nest could prove to be a suitable reference point for other pension providers suggests Rudi Smith, Towers Watson
Recent legislation and regulator guidance has brought into focus the need to consider defined contribution (DC) scheme design and it is only natural for Nest to come under careful scrutiny. To what extent will Nest act as a benchmark for DC schemes?
Nest undertook a perhaps unprecedented degree of...
The DWP has sketched out the basic design for the default option to which schemes can add the detail explains Richard Parkin, Fidelity Worldwide Investment
We waited a long time for this year’s Department for Work and Pensions’ (DWP’s) guidelines for the design and governance of default investment options. These apply to defined contribution (DC) pension arrangements that are to be used for auto-enrolment from October next year....
Tim Banks, AllianceBernstein, argues for target date funds to be the new default for defined contribution schemes
The publication earlier this year of the Department for Work and Pensions’ (DWP’s) guidance for defaults in auto-enrolment defined contribution (DC) pension schemes has further raised the bar for pension providers and trustees. The principles laid down by the DWP, although not binding,...
Branding is essential if you want your employees to value their pension, says Steve Herbert, Jelf Employee Benefits
Employer supported pension provision for all will become the norm within the next decade. This has many implications, but one that has largely been overlooked is the perception of company pension schemes.
Historically, employers have voluntarily provided a pension scheme for various reasons,...
Is open market option reform coming too late to save annuities? wonders Patrick Connolly,
AWD Chase de Vere
Annuity product providers are doing a grand job in delaying the implementation of a universal open market option (OMO) facility for those looking to take pension benefits. Despite continued pressure from the financial press and lobbying from those in the financial advice industry, including the...
Lessons can be learnt from the viewing patterns for Strictly Come Dancing relevant to online pension planning suggests Geraldine Brassett, Aon Hewitt
I was flicking through my copy of the Metro newspaper the other day when an article caught my eye. The piece was about the fact that the unseasonably warm autumn weather had substantially reduced the viewing figures for the X Factor and Strictly Come Dancing as people had taken advantage of the...
Taking control of risk management will help trustees to sleep at night advises Maralyn Thomas, Castle Pension Trustees
Pension scheme trustees are not expected to become experts. And yet, more and more, they are having to become proficient in risk management, which is now a regular item on trustee meeting agendas. And, in the present circumstances, this is not surprising.
According to the Pensions Regulator (TPR...
The IORP Directive is likely to discourage rather than encourage cross border schemes warns Jane Marshall, Macfarlanes
Shortly after the millennium, the European Commission concluded that an EU framework for pension schemes was needed to complete the single market in financial services. Like other financial institutions, pension schemes were to be able to operate in other member states, provided that members were...
As a New Year pension resolution, why not volunteer for TPAS? urges Tony Attubato, TPAS
Forget about dieting, getting fit, or trying to give up smoking. The resolution we hope you make in 2012 is: “I’m going to volunteer for TPAS”.
For over 25 years the core of our free service has been delivered by volunteer advisers drawn from all sections of the pension industry....
Terry Saeedi and Ruth Bamforth, Eversheds, highlight the main regulatory challenges facing overseas employers with UK DB schemes
We live in a world of ever increasing globalisation. Multinational corporate groups are just one example of this. As business continues to operate across multiple jurisdictions, it is increasingly important for overseas employers to understand the implications for themselves and their wider...
With the arrival of auto-enrolment, it is vital that members understand how the default option works warns Malcolm McLean, Barnett Waddingham
As we get ever closer to the start of auto-enrolment, there is growing interest and concern about the use of the default option, given the large numbers of new scheme members who are likely to be enrolled into it in the future.
Following a consultation exercise, the Department for Work and Pensions...
Employers struggling to finance their pension scheme could use asset backed funding structures, suggests David Fairs, KPMG
Property, whisky and trademarks have all been used in asset backed funding structures (ABF structures) and the number put in place has significantly increased in the past 12 months. With volatile stock markets, depressed bond and gilt yields and increased deficits, ABF structures will be used even...
Andrew Cheseldine, Lane Clark & Peacock, explains the scheduling of the minimum rates of contributions to a defined contribution scheme
In last month’s article, we looked at the minimum quality requirements which pension schemes must meet to fulfill the auto-enrolment requirements, including the minimum rates of contributions that must be paid to a defined contribution (DC) scheme. These minimum rates of contributions are...
Public sector employees are being asked to work longer and pay more for their pensions. Deborah Cooper, Mercer, looks at the arguments
Until recently, pension provision has been a virtually invisible part of employees’ remuneration packages, viewed as something employers must provide to pass a “good employer” test, rather than as a valued benefit. Now, following Lord Hutton’s review, British public sector...
Joanne Segars, chief executive, the National Association of Pension Funds, answers questions from Stephanie Hawthorne, editor, Pensions World
What is a Master Trust?
A Master Trust is where a product provider, normally an insurance company, manages a pension scheme for a number of employers under a single trust arrangement.
What are the advantages of a Master Trust?
Britain’s pensions landscape is characterised...
