Pensions and Growth Aligned

Ask One Question

​DB trustees and sponsors are one question away from better pensions for past and present employees and reviving the UK economy.

“What is the risk-benefit of bulk transfer v run-on strategies for stakeholders given current Pensions Bill, new regulatory objectives and Budget tax changes?” 

Ask what FRC required TAS300V2.1 numbers show and the case for buyout collapses – unless there is an ongoing value share introduced for members. 

Surpluses made available; easier use of discretion; pre-1997 haircuts cut.

Fiduciary duty of trustees and shareholder value for sponsors now requires a formal DB risk-benefit update.

DB Run On.  A Cog to Move UK Economic Growth

​Schemes are encouraged by regulation to run-on long term and incentivised financially to raise UK productive asset allocations.  

Reinforce with Government arranged FSCS / PPF safety nets cost / coverage linked to investment strategies. 

UK markets have more buyers than sellers and will attract more investment opportunities.

More of the £1.5 trillion backing UK DB pension liabilities is invested in UK productive assets.  Pensions increase.

Increase Shareholder Value by Value Sharing

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​Tap the DB fund rubber tree over time to share value for past and present employees and the plantation’s sponsor.

Life insurers can adjust their products to cut members in over time as yields allow.

Collective Defined Contribution grows rapidly in a sharing environment where surpluses are recycled.

Cut in stakeholders with value sharing

with value sharing

How All Can Benefit from Eased Solvency Rules

​​Solvency II and Solvency UK rule changes opened a regulatory arbitrage and improved markets for life insurers.  TPR: Your move.

Global fixed income funds, often Bermuda registered, are hoping schemes can be “palmed off” their very profitable way.

UK regulators are worried they lose track of events on tropical islands.  Incentivise life insurers to bring assets home through a FSCS levy on assets held offshore.

Don't palm off members

to Bermuda in bulk

Members and sponsors can now help themselves and the UK economy by asking their actuaries and legal advisors to provide a FRC TAS300V2.1 update to incorporate in their TPR required Funding and Investment Strategy.  Maths counts.

And Government is closing in on a big economic win.

• More of £1.5 trillion backing UK DB pensions invested in UK productive assets and UK taxpaying companies.
• Increase to annual £50 billion in UK pensions stimulating spending and raising tax.
• More money coming into UK markets providing liquidity and stimulus to financial sector.

Sound the Bell; Beat the drum for the UK growth agenda.

What will accelerate progress?  “Scrutiny; Incentives; Members”