UK - Workers are being confused by over-inflated pension projections when they join a money-purchase scheme, Aon Consulting claims.
False projections could mean fund values for new members of DC schemes are being overstated by an average of 70%.
Aon claims the problem stems from the FSA’s “new joiner illustrations” of 5%, 7% and 9% which do not take inflation into account.
When enrolled in a DC scheme, a growth rate of 7% – taking inflation into account – is used to calculate the statutory money purchase illustration.
As a result, new scheme members only become aware of the “lower” inflation-linked pension fund projections after joining.
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.