Pension news

Week ending 27 November 2020

Clarity on the future of RPI

The Treasury and the UK Statistics Authority have published their response to the consultation on reform of the methodology for calculating RPI. The Chancellor has not given permission for RPI to be aligned with CPIH prior to the date from which he has no power to stop it, which is February 2030 (this is the date that the last “specific index-linked gilt” matures). The UK Statistics Authority still intends to calculate RPI using the same methods and data sources as CPIH from 2030 although, even from that date, RPI will continue to be published separately from CPIH.

The Treasury has also confirmed that no compensation will be offered to holders of index-linked gilts, as strictly their contractual terms will not be changing. It was noted in the response that the vast majority of respondents who hold index-linked gilts had called for such compensation.

National Infrastructure Strategy

As part of his Spending Review, the Chancellor announced a new National Infrastructure Strategy, including a new UK infrastructure bank (based in the North of England). The bank will co-invest in UK infrastructure alongside private sector investors, which could include pension funds.

Triple lock maintained

The Secretary of State for Work and Pensions has confirmed that State pensions will rise by 2.5% from April 2021, in line with the triple lock and ahead of both price and earnings inflation.

Recent publications

News

22 January 2021

In the news over the last week, the Pension Schemes Bill is at the final hurdle, automatic enrolment limits are reviewed, there is new research into trustee decision-making, the FCA sees signs of improvement in DB transfer advice and a full buy-in is completed.

Arena

Pensions Arena October 2020

This quarter’s Arena has a summary of our recent Pensions Perspective, “Endgame planning comes of age”, which looked at how long-term funding and investment plans are evolving and why companies are increasingly taking the lead in designing an endgame strategy. It also shows all the usual financial and investment analysis for the quarter ending 30 September 2020.

Perspective

Endgame planning

Journey plans or glide paths may have been around for a long time but they’re at the heart of the Regulator’s proposed new funding code. In this Pensions Perspective, Leonard Bowman looks at how long-term funding and investment plans are evolving and explains why companies are increasingly taking the lead in designing an endgame strategy for their schemes.

Arena

Pensions Arena July 2020

This quarter’s Arena has a summary of our recent Pensions Perspective, “Emerging from lockdown”, which looked at how best to tackle the most common pension issues which companies are currently facing. It also shows all the usual financial and investment analysis for the quarter ending 30 June 2020.

Perspective

Emerging from lockdown

As we keep hearing, we are living in unprecedented times. However, as we turn our attention to the future, what does the “new normal” mean for defined benefit pension schemes? In this Pensions Perspective, Leonard Bowman considers the most common pension issues that companies are facing and how best to ensure that the company approaches these on the front foot.

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