UK - Making Myners' proposals law would run counter to the government's own aims to ease pensions red tape, the Society of Pension Consultants warns.
The SPC's response to the Department for Work and Pensions consultation points out that further legislation would create extra costs and administration and would run counter to the DWP's own Simplification Review headed by former NAPF chairman Alan Pickering.
SPC secretary John Mortimer also warned against increasing controls over the authorisation of financial transactions.
He predicted that the proposal would lead to resources being put into box ticking with a view to meeting the letter of the legislation, rather than building mechanisms to ensure that transactions were properly authorised.
He also felt the proposal that schemes should obtain professional advice before certain large financial transactions, would only lead to them not taking place, due to the cost and the delay in doing so.
On the proposal that pension scheme trustees should be familiar with the investment decisions concerned with their job, Mortimer urged that responsibility for such standards should apply collectively, to all members on a board of trustees.
He also said that fiduciary responsibility should not be extended to pension scheme beneficiaries as this would reduce clarity on the responsibility of trustees.
And on the issue of shareholder activism, Mortimer warned that the broad phrasing of the proposed statutory duty would lead to increased litigation.
He pointed out that trustees were unlikely to have access to enough relevant information to engage in shareholder activism.
He added that even if they did have such information, they would probably be insufficiently familiar with the specific businesses in which the fund is invested to judge when intervention might be necessary.
Instead, he proposed that schemes should have a policy statement on intervention in their statement of investment principles should suffice.
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