UK - Liberal Democrat plans to assign ratings for final salary schemes have been dismissed as empty "headline-grabbing" ideas by Alexander Forbes Financial Services.
The party wants to reform occupational schemes by launching a kite mark-style programme which would enable employees to check how their company’s fund was rated.
However, AFFS marketing director David Marlow dismissed the proposals and said: “The real problem facing many final salary schemes is that they are so underfunded that companies can no longer afford to keep their pension promises.
“The LibDem proposals donít have any details about how to make schemes more affordable for employers and the only real solution for many businesses is to close their final salary schemes and offer employees high quality DC alternatives.”
Marlow added that while members of well-funded schemes would welcome the mark, employers with underfunded schemes would struggle to recruit and retain staff. He also claimed the costs of complying with the proposals could prompt further scheme closures.
He said: “The kite mark idea is great for firms with well-funded schemes but those which fail to reach the standard may find it harder to recruit and retain staff.”
Businesses are experiencing auto-enrolment data error rates of up to 50%, posing questions over the reliability of pension records, Pensionsync says.
A nationwide survey of committee and local pension board members of the Local Government Pension Scheme has revealed high levels of confidence in all areas of their responsibility.
UK inflation unexpectedly rose to 2.7% in August, beating analysts' expectations of a drop to 2.4% from 2.5% the previous month.