Britain’s pension deficits grew by £100bn in August alone September 1, 2016 Britain's companies were urged to think of plugging pension holes as “part of the furniture” of financial planning after new research showed that deficits grew by a staggering £100bn during August. The PwC Skyval index, which covers 6,000 British defined benefit pension schemes, revealed that aggregate deficits had widened to £710bn by the end of August. [...]
Don’t overreact to vast pension scheme deficits: We need a new normal for how they’re measured September 1, 2016 Pension schemes are faced with serious challenges following the EU referendum result and the Bank of England’s recent stimulus package. Both events have driven down long-term gilt yields. As a result, for defined benefit pension schemes valuing their liabilities using gilt discount rates, deficits continue to grow. Our Skyval Index shows that deficits have increased [...]
Experts welcome Treasury proposals to allow tax-free draw-downs to fund financial advice August 31, 2016 With millions of workers being automatically enrolled into a workplace pension the Treasury launched a consultation to ensure that they are adequately advised in preparation for retirement. The launch follows an announcement by the government in the March 2016 Budget to consult on recommendations by the Financial Advice Market Review (FAMR). The FAMR proposals were to allow [...]
Pension or property: Which is the better option for your retirement? August 31, 2016 The Bank of England’s chief economist Andy Haldane drew ire from the pensions industry for the second time this year, when he claimed that property was a better investment option for retirement than a pension in an interview with The Sunday Times this weekend. “It ought to be pensions but it’s almost certainly property,” Haldane said. [...]
An art rather than a science: one way to value the assets, four ways to value the liabilities August 29, 2016 Many of us like big numbers. But when it comes to pensions deficits, big numbers are not a good thing. Britain’s pension deficit values vary from day-to-day and from calculation to calculation. The numbers cited range from hundreds of billions to trillions of pounds. The reason they differ is because there numerous ways of calculating [...]
Pension funds want government help to hedge spiralling deficits August 24, 2016 The government has responded to calls for help from Britain's pension funds in managing their ever-growing deficits. The UK Debt Management Office released its latest consultations on Tuesday and concluded it would sell three tranches of index-linked debt within the third quarter of this year – one through a syndicated sale and two through an auction. Long-running pension scheme [...]
Falling ratios are far from critical according to Fitch August 23, 2016 A top ratings agency has given the UK's life insurance firms a vote of confidence, despite recent tough market conditions. The fall in bond yields over the first half of 2016 may be squeezing solvency ratios at Britain's leading life insurance companies but the decline is not enough to worry ratings agency Fitch, which said they "remain strong". Under Solvency II, insurers [...]
Direct Line abandons plan to offload part of its pension scheme August 16, 2016 Direct Line has abandoned the potential offload of part of its pension scheme, following the conclusion of an internal review. It was part of a defined benefit (DB) scheme — in which monthly payouts are linked to an employee's final salary — going back to when the insurer was wholly owned by the Royal Bank of Scotland. Direct Line [...]
Smallest businesses face £22m of fines over auto-enrolment pensions confusion August 8, 2016 UK micro-businesses are collectively facing fines of up to £22m due to a lack of understanding around auto-enrolment pensions, a new report has warned. The Pensions Regulator estimates that around 262,000 micro-businesses, defined as firms employing between one and four people, are set to “stage” – or be required to set up a workplace pension [...]
Work and Pensions committee takes next step in inquiry into state of play of pensions August 8, 2016 MPs have today issued a call for evidence for an inquiry on the state of defined benefit (DB) pensions, with the roles of the pensions watchdog and lifeboat in particular thrust under the microscope. The inquiry by the Work and Pensions committee was sparked by its recent investigation into the pensions situation at BHS. The retailer had [...]