The PLSA’s second report on Defined Benefit pension schemes: Time to consolidate?
Held on Wednesday, March 29, 2017
Ashok Gupta (PLSA)
David Fairs (KPMG)
Alan Pickering (BESTrustees)
Tim Sharp (TUC)
The UK’s DB pension schemes look healthier than they did when we last examined them six months ago. The aggregate deficit for schemes had fallen to £196.5bn at the end of January. British Steel and BHS pensioners look set to receive more than might have been feared. On top of that, the DWP’s February Green Paper declared:
“The available evidence does not appear to support the view that these pensions are generally ‘unaffordable’ for employers.”
So, don’t panic. Or should we? The Pensions and Lifetime Savings Association has a taskforce on DB schemes and, according to its latest report, action is required. Specifically (according to the PLSA), pensioners would stand a better chance of receiving most of their benefits if costs were cut by consolidating the myriad legacy schemes.
Ashok Gupta, chair of the taskforce, has kindly agreed to present the case for consolidation. He is an NED of New Ireland Assurance and JP Morgan European Smaller Companies Trust. He is also a member of the FRC Codes and Standards Committee and Actuarial Council. He chairs eValue Investment Solutions, and was recently joint deputy chair of a BoE Working Group on Procyclicality.
Consolidating schemes with myriad benefits and volatile deficits will require both sacrifices and compromises – giving trustees and pensioners some hard choices. To debate the merits, we have three other experts in the field:
- David Fairs is lead partner in KPMG's People Practice, a partner in the pensions practice, and a former member of The Pension Regulator's Advisory Panel. He is also the immediate past Chairman of the Association of Consulting Actuaries.
- Alan Pickering is Chairman of BESTrustees and a trustee of numerous pension schemes. He also chairs the governance group of the Royal Mail Statutory Pension Scheme. He is a past Chairman of the NAPF (the PLSA’s precursor) and of the European Federation for Retirement Provision.
- Tim Sharp is pensions policy officer at the TUC and serves on the members panel of NEST. A former journalist, he has written for Citywire, Investment Week, the Sunday Telegraph, and Daily Mail. Most recently, he was City Editor of the (Glasgow) Herald.
As usual, we hope you will share your own insights/hope/fears with the rest of the group. If you (or a colleague or friend) would like to join us for what I hope will be a lively and informative discussion, please let us know by calling 0207 621 1056 or emailing firstname.lastname@example.org. Sandwiches, wine and refreshments will be provided.