UK - Thousands of schemes are faced with an "impossible" deadline to comply with new transfer regulations, consultants warn.
The new regulations – effective from August 4 – allow schemes to cut transfer values to bring them in line with available assets in the fund.
However, in order to qualify under the new regulations schemes must have a full actuarial report – a GN11 – recommending these reductions.
Consultants say the GN11s cannot be completed in time.
Independent Transfer Services estimates that up to 45% of schemes have either suspended or reduced member transfer values.
Mercer Human Resources Consulting European partner Matthew Demwell said trustees have been caught in a pincer movement and OPRA must devise a plan to deal with the expected backlog.
HSBC Actuaries senior consultant Duncan Kinnear says schemes will effectively have to pay for two valuations within a short space of time and many may feel they have been “mugged” by their consultants.
OPRA hopes to issue guidance to schemes in the “near future”.
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