UK - Tower Hamlets claims it was "left in the lurch" when Watson Wyatt abandoned its duties as scheme actuary.
The council says it was forced to skip the normal tendering process when Watson Wyatt decided to leave the local authority market in April.
Watson Wyatt gave its 21 clients notice that it would no longer take on their – or anyone else’s – work by the end of October.
The £434.8m London Borough of Tower Hamlets Pension Fund said it hired Hymans Robertson as its replacement with immediate effect without going through the normal tendering process.
The council hired Hymans – originally its second choice – because its sponsor needed a complete interim actuarial valuation as part of its budget work.
Tower Hamlets wants the valuation so that it can determine what pension costs it will have to meet.
Group accountant Jim Ricketts said: “We were more or less sacked by Watson when it withdrew from the market. We were sacked by the actuary.
“The next triennial valuation is due in 2004, but what we really want to do is adopt any increases into the medium-term financial strategy we’re doing at the moment.
“That’s why we really need a firm indication of what the figures will be.
“We’re obviously worried about the funding position, and if we do have to put additional contributions in, we would prefer to do it early, rather than wait until 2004.”
The scheme currently allocates 67% to equities; 6% to UK fixed interest securities; 10% to index-linked gilts; 11% to property; and 6% to cash/deposits. Its fund managers are Deutsche Asset Management and Schroder Investment Management.
Watson Wyatt declined to comment.
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