UK - Actuaries are urging the government to revise draft regulations that would give trustees the power to force companies into liquidation.
The Association of Consulting Actuaries warned that a trustee’s ability to instigate a wind-up and force full buyout costs could jeopardise the finances of their sponsors and push some into insolvency.
The ACA said trustees’ power to put a scheme into wind-up should be limited to circumstances where an employer’s ongoing contribution would lead to deterioration in the level of benefit security.
It added: “This would limit the circumstances in which the power could be used, prevent it from being used improperly as a bargaining lever and take away trustees’ responsibility of having to consider whether to use such an extreme power.”
The ACA’s view is in line with those expressed by independent trustees, many of whom expressed “horror” at the new powers which the regulations would bestow on them.
They fear the proposals would force them into becoming financial analysts.
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