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Actuaries offer guide to transfers

The Faculty and Institute of Actuaries is publishing a guide outlining the

questions employees should ask before trans- ferring out of their

employers&#39 occupational pension scheme.

The booklet is released at a time when occupational pensions are under

increasingly close scrutiny.

The BBC&#39s Panorama programme recently looked at the trend of employers

switch-ing from final-salary schemes to money-purchase plans or group

personal pension plans.

The moves from defined-benefit final-salary-type schemes to

defined-contribution versions such as money-purchase plans has been

exacerbated by fears of the increased costs of final-salary schemes.

The guide helps scheme members understand how their pension transfer

benefits are calculated and moved from one scheme to another.

It says individuals should ask for full details of the benefits the

transfer to the new scheme will buy and recommends employees seek

appropriate advice where necessary from either an actuary or an independent

adviser.

Faculty of Actuaries president Fraser Low says: “Transfer values are one

of the most complex areas of pensions and it is important that people are

given the opportunity to understand what happens when a pension fund

transfer takes place.”

The Occupational Pensions Regulatory Authority has published a guide to

help pension scheme trustees, auditors and insurers prod-uce audited scheme

accounts on time.

It explains the need for a strict timetable as late accounts is one of the

most common breaches of the Pensions Act and Opra can impose a fine of up

to £50,000.

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