It has been yet another busy 12 months of challenges and changes for pensions. Below, we look back at our top ten industry news stories of 2022.
Mini Budget sparks crisis in LDI and gilt markets
By far the biggest news story of 2022 was the crisis in the gilt and liability-driven investment (LDI) market following the then chancellor Kwasi Kwarteng's Mini Budget on 23 September.
In the wake of the budget, the yields on 25-year UK government bonds soared to over 5% before the Bank of England announced its 'gilt market operation' on 28 September and additional measures to support LDI and gilt market on 10 October to bring yields under control.
PP wrote extensively on the crisis - including top ten articles on how the pensions industry dealt with the LDI crisis and the lessons to be learned.
View PP's coverage of the LDI crisis and its aftermath here.
Ministerial merry-go-round restarts in 2022
Ministerial movements also featured heavily in the top news stories of 2022 after a long period of stability, which saw Guy Opperman become the longest serving pensions minister in modern history on 11 June.
These movements included Guy Opperman's resignation on 7 July, his reappointment on 8 July following prime minister Boris Johnson's resignation, and the appointment of Chloe Smith as secretary of state for work and pensions on 7 September following Thérèse Coffey's appointment as secretary of state for health and social care in prime minister Liz Truss' new cabinet.
Alex Burghart was appointed as a parliamentary under secretary at the DWP on 20 September and was formally named minister for pensions and growth on 12 October.
Mel Stride took over the role of secretary of state for work and pensions after Rishi Sunak became prime minister on 25 October 2022. Laura Trott was appointed as a parliamentary under secretary at the DWP on 27 October and was formally named minister for pensions on 7 November.
View Professional Pensions' full list of pension ministers here.
Government sets out Solvency II reform package
The government has set out its final reform package for the regulation of insurance companies in the UK following its consultation on the review of Solvency II.
In its consultation response, published by HM Treasury on 17 November, the government said it would introduce a "simpler, clearer, and much more tailored regime".
In particular, it said it would cut the required risk margin significantly, with a 65% cut for long-term life insurance business.
It said it would also increase investment flexibility by overhauling eligibility rules for the matching adjustments.
And the government pledged to "slash red tape lingering from the EU", which it said imposes "unnecessary burdens on firms, restricting innovation in our vibrant market".
The government said it had decided not to take forward the Prudential Regulation Authority‘s proposals for reform of the so-called "fundamental spread" and would maintain the existing methodology and calibration, while allowing for the use of notched ratings, for example, different allowances for assets rated AA+ or AA- compared with AA.
Schroders hired for £10bn Centrica OCIO mandate
As OCIO, Schroders said it would help the trustees develop the schemes' investment strategy, construct the overall portfolio as well as manage and oversee third party managers.
In addition, Schroders said it will support the trustees in meeting the schemes' regulatory requirements.
As part of the mandate appointment, the team of seven Centrica in-house investment specialists, led by chief investment officer Chetan Ghosh, joined Schroders Solutions.
Zedra buys PTL as owners look to derisk business
Corporate services business Zedra has bought professional trustee firm PTL.
The acquisition expands Zedra's pension services business in the UK - adding a professional trustee offering to its existing support and governance business, which it established through the acquisition of Inside Pensions early last year.
Zedra's pension services business now consists of five offices in London, Reading, Leeds, Birmingham and St Albans with 70 professional and support staff.
The deal - for an undisclosed consideration - saw PTL's six directors, who own the majority of the independent trustee business, sell their stakes in PTL's holding firm, Bromhead Holdings, for a combination of cash and equity. Five of the six have become shareholders in the new firm.
Trustees jailed for ten years over £13.7m pension scam
Alan Barratt of Althorne, Essex and Susan Dalton of Rochdale, Lancashire were found guilty of fraud by abuse of position in breach of the Fraud Act 2006 after they were accused by TPR of persuading 245 savers to transfer pension savings totalling £13.7m into ten fraudulent workplace pension schemes between 2012 and 2014.
These schemes were controlled by the defendants in their capacities as trustees across all ten of the UK-based schemes - positions they operated from Spain where they had both been living.
Following a lengthy procedure including a High Court case and Barratt's extradition from Spain, Barratt received a sentence of five years and seven months prison, while Dalton received a sentence of four years and eight months.
Barratt was the trustee of six of the fake occupational schemes, which in turn were linked to shell companies set up by now-deceased fraud "ringleader" David Austin. Within these schemes, 139 victims have been identified as having transferred £7.7m in pension monies.
Dalton acted as trustee of the four other schemes in the scam into which 103 victims, including Dalton's brother, transferred a total of £5.9m in workplace savings.
Arthur J. Gallagher agrees to acquire Buck for £543m
Arthur J. Gallagher has agreed to acquire the partnership interests of BCHR Holdings, the businesses trading as Buck, for a gross consideration of $660m (£543m).
The insurance brokerage, risk management and consulting services firm said the deal is expected to close during the first half of 2023, subject to customary regulatory approvals.
Buck is the retirement, HR and employee benefits consulting and administration services firm that has over 2,300 employees, including around 220 qualified actuaries, across a number of global markets including the UK, US and Canada.
TPR announces new chief executive
The Pensions Regulator (TPR) has appointed Nausicaa Delfas as its new chief executive (CEO), taking over the role in March 2023.
Delfas - who is replacing Charles Counsell - joins from her current role as executive director of governance at the Financial Conduct Authority.
She was previously interim chief executive and chief ombudsman of the Financial Ombudsman Service.
In the new role, Delfas will lead TPR as it continues to implement a raft of new high-profile initiatives designed to improve outcomes for savers
She will also focus on driving value for money for savers, ensuring auto-enrolment continues to be a success and tackling criminal activity.
The top third-party administrators and software providers in 2022
The results of the Professional Pensions Administration Survey 2022 revealed the rankings of the best third-party administrators and software providers for pension schemes.
Clara Pensions appoints new CEO to replace Adam Saron
Clara Pensions has hired Simon True as chief executive (CEO) to take over from the firm's founder, Adam Saron, who will move to an advisory role.
The consolidator - which completed The Pensions Regulator's (TPR) assessment process in November last year - said the move comes as it prepares for the "next phase of growth". It said it is currently "on track" to consolidate £5bn in defined benefit (DB) pension scheme liabilities by the end of 2025.
True is a life insurance executive with over thirty years of experience in the industry. His most recent executive role was the group corporate development director and group chief actuary at Phoenix Group.
He previously led the mergers and acquisition teams within Resolution and Resolution Operations - both of which grew into FTSE 100 businesses.
