UK - NAPF CONFERENCE: The current system of occupational pensions provision needs to change dramatically if the industry "crisis" is to be resolved, keynote speaker Peter Jay told delegates.
Jay – a broadcaster and former ambassador – stressed that the “new crisis” was in occupational pensions, as the state system had failed to adapt to the demographic trends of the population.
He explained private pensions had been “greatly undermined”, not by an ageing population and falling stock market, but by trustees’ discretion to make investment decisions to match scheme liabilities.
Jay blamed trustees and their actuarial advisers of incompetence in their investment advice.
“The promise of pension can only be squared if equities outperform bonds.
“But every schoolboy knows this is not possible. If schoolboys know this why don’t actuaries and trustees?”
And he said the issue of longevity has been overplayed by actuaries: “Any actuary that claims to be taken by surprise [by the ageing population] hasn’t been paying attention.”
But he stressed the workplace is the best means by which to achieve widespread pensions provision.
“Activities organised via the workplace achieve highest participation rates. So we must look to the employer for pensions.”
PwC, KPMG, EY and Deloitte must break up their consultancy and audit businesses into distinct firms to provide greater focus on the "most challenging and objective audits", the competition watchdog has said.
The Department for Work and Pensions (DWP) has released its first batch of guidance setting out how the guaranteed minimum pension (GMP) conversion legislation may be used to resolve unequal payments.
This week's top stories include the government spending £800,000 on a Gogglebox advert and MPs writing to The Pensions Regulator about its engagement with the Railways Pension Scheme.