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‘120Bn blow’ to deficits in pension funding proposals

Pension experts are warning that proposed radical changes to pension fund calculations from the Accounting Standards Board could have damaging implications for defined-benefit schemes.

The proposals may force companies to use more conservative measures to calculate the value of their future pension fund liabilities.

Aon Consulting calls the proposals “another dagger in the side” of final-salary pensions and says they would add around 120bn to the combined deficit of the UK’s 200 biggest pension schemes.

Senior consultant and actuary Marcus Hurd says: “The proportion of schemes in surplus would fall massively from 40 per cent to 2 per cent, causing widespread panic and misunderstanding.”

BDO Stoy Hayward actuarial director John Broome Saunders says: “This is a real kick in the teeth for DB scheme sponsors, just when they thought they had their schemes under control. At a stroke, hard-earned balance sheet surpluses will disappear and, even worse, sponsors will find themselves facing an uncontrollable rollercoaster profit and loss ride.”

Pension consultant Ros Altmann says: “It is about time we recognised reality now, rather than trying to keep pushing pension costs into the indefinite future. This bravely attempts to inject more reality into reporting the true costs of employer defined-benefit pension promises. There is likely to be strong resistance from both industry and Government to many of the proposals which would, if adopted, cause reported pension scheme deficits and perhaps funding costs to rise.”


Regulation plea for all loan business

Premier Mortgage Service managing director John Malone is calling on the Government to regulate the secured loan market and all other unregulated parts of the mortgage industry.The call comes in response to Black and White’s recent decision to withdraw from the regulated mortgage market to concentrate on unregulated areas such as secured loans, commercial loans, […]

BTL purchase mortgages up 5 per cent in January

Hampton Mortgages says that buy-to-let purchase mortgages taken out in January increased by over 5 per cent compared to December 2007.In December 2007 BTL purchase mrotgages were at 39.53 per cent, this increased to 44.54 per cent in January 2008. The broker’s January best buy mortgage tracker’s figures reveal that the BTL market remains resilient […]

Parmenion joins Simplybiz scheme

Parmenion Capital Partners is to work in tandem with SimplyBiz in a deal that will allow advisers to invest in the outsourced investment platform.


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