The Institute of Actuaries will play a pivotal role in the implementation of government legislation over the next 12 months, incoming president Michael Pomery (pictured) promises.
Pomery – who takes over from Tillinghast-Towers Perrin principal consultant Jeremy Goford in July – said the institute had a key advisory role introducing scheme-specific funding requirements.
Pomery – a principal consultant with Hewitt Bacon & Woodrow – emphasised the need for a smooth transition to prevent a “regulatory regime”.
He said: “The replacement of the minimum funding requirement means actuaries will increasingly be called upon for advice. It is essential this is seen to be successful to prevent unwanted government regulation on funding standards.”
One key area will be drawing up statements of funding principles between employers and trustees which, Pomery says, could lead to potential conflicts of interests.
He added: “In the 5% of cases when the same actuary advises both the employer and trustees, we strongly recommend caution. This is an area we are looking into actively and, while it may be sufficient to get the consent of both parties, society’s call for greater accountability makes this a potentially dangerous area.”
Pomery – who has been in the profession for nearly 40 years and won the institute’s outstanding achievement award in 2001 – says the role of the actuary is changing.
“We now need to understand the business context in which we are giving advice and recognise that a pension fund is not a separate entity. New accounting standards will bring this home – with a recognition of surplus or deficit on the balance sheet – and pension funds will no longer be seen as trust funds run alongside companies.”
Pomery will serve a two-year term. He was the institute vice-president from 2000 to 2002, and is currently chairman of the profession’s social policy board.
This week's edition of Professional Pensions is out now.
Ben Gunnee reflects on 2018 and talks about the Fiduciary Management trends to keep an eye on in 2019
Lloyds Banking Group secured 630,000 new pension customers last year, according to its 2018 annual results.
Guy Opperman has rejected calls to speed up changes to auto-enrolment (AE) despite increasing pressure to boost contribution rates and overall savings pots.