UK - Employee benefits specialist Gissings is moving its third-party administration business out of London but denies the move has been driven by cash constraints.
The consultant has transferred the division and the majority of staff – who service clients including the MTL Instruments and the United Technologies schemes – to Hemel Hempstead.
The move follows its decision to make 19 staff redundant across all areas of its business as part of a cost-cutting programme.
A source inside Gissings said the firm had been hit by “cash compensation payments” to settle its part in the personal pensions mis-selling review. In total, more than a million people have received compensation after being wrongly advised to leave final salary schemes.
The source said: “Gissings claims it has made the necessary accrual for the pensions review and it has all been written off. But the general belief is that it has still got a major overhang there and it has to minimise costs in all directions.”
A Gissings spokeswoman denied the claims.
She said the administration business was moving out of London simply because of capacity constraints – but she admitted growth had not met expectations.
She added: “Over the past few years, Gissings has increased its cost base in anticipation of continued growth.
“This past financial year the company did not grow as much as projected.
“Like many others we have had to look at ways to reduce expenses in the current economic climate, which will inevitably include staffing costs. The redundancies were not made as a result of costs incurred in the pensions review. Gissings budgeted for the expected final costs of the pensions review last year.”
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