So the country has spoken in a momentous and slightly surprising result! We now enter a period of extreme uncertainty while we wait to see what happens next. Markets don’t like uncertainty and we’ve already seen sterling fall to levels last seen 30 years ago but there is no need to panic. Our legal framework today remains exactly the same as it was yesterday and we have some time to decide what changes we’ll make and watch how negotiations go.
As far as pension schemes go, we can take comfort from the fact that funding is a long term proposition and we can afford to avoid any knee-jerk reactions. There may also be some opportunities for funding levels to increase, especially if we see a rise in gilt yields (which may be needed to attract international money into the UK coffers). Trustees can potentially take advantage of the expected volatility in markets to reach their investment objectives. Setting clear targets in advance and monitoring market movements will allow schemes to trigger investment switches whenever market conditions are favourable, locking in improvements as they happen without needing extensive discussions that lead to missed chances. Read more »
Spence & Partners latest blog for Pension Funds Online
I believe that clients should be using and taking more advantage of their investment consultant. I see clients paying for actuarial valuations, reviewing actuarial factors and other matters but generally not making full use of their investment consultant. Clients legally have to do a valuation or other compliance work, but often see investment work as something that is secondary to this. For example, there is not a legal requirement to carry out an investment strategy review like there is for a triennial valuation, it is just considered best practice, so sometimes one isn’t carried out.
I sometimes see cases of trustees who haven’t reviewed their investment strategy in over 10 years and their Statement of Investment Principles in a similar period of time. Read more »
Here we are, at the end of Q2 and Spence are pleased to be publishing our topical round up of developments over the last three months with time saving summaries, helpful links to papers and blogs and action points for Employers and Trustees to consider. It’s an essential tool for Employers and Trustees who need to keep up to date with developments that affect them and their schemes. Highlights for this quarter include:
- A brief summary of George Osbornes 2016 Budget
- An outline of the new Lifetime ISA
- How might the Brexit Referendum affect schemes?
- Notwithstanding Brexit what has been happening in Europe and what will it mean for schemes?
- Important changes for Corporate trustees: Persons with Significant Control Regime
We love to get feedback and constructive criticism. If you like what we do please tell us, it’s nice to get great feedback. If you would like things included, excluded or done differently please drop us a line. The report is to help you so help us tailor it to your needs.
Download your Quarterly Update here
(The ‘H’ on my keyboard is in for a tough afternoon!)
Good news for bankrupts. Bad news for creditors. Important news for trustees in bankruptcy and pension scheme trustees alike. The High Court, in the case of Hinton v Wotherspoon, has delivered a judgement that provides real clarity on how the pension income of a bankrupt can be subjected to an Income Payments Order (“IPO”).
Now, it has to be said at the outset, that a case on the same issue (Horton v Henry) – that Hinton proclaimed as “plainly correct” – was heard by the Court of Appeal in April. That decision will be crucial, as it will represent a binding decision from a higher court, unlike Hinton and Horton that are both first instance decisions in the High Court. Read more »
Recognising the many difficulties charities who participate in Local Government Pension Schemes face, a series of really helpful guides have been published over the last few weeks:-
- Leading legal firm Charles Russell Speechlys has produced a really helpful LGPS Charity briefing for Charity Finance Group (CFG). The guide outlines the risks and options for charities considering joining LGPS, and the problems faced by those considering exiting. The CFG accompanying blog is here.
- Leading representative body Pension & Long term savings Association (‘PLSA’), formerly the NAPF, have launched the first two guides in a series covering charities in LGPS. These cover:
Read more »