An interactive voting session held by Punter Southall Group revealed that over 70% of the audience felt that pensions now needed to be paid for at much higher levels than the historic norms from the 1980s. Perhaps unsurprisingly, therefore, the majority supported an increase in retirement age to 70 by 2050.
The poll revealed that the audience felt strongly that existing pension promises must be met but were wary of the ability of employers to absorb additional costs, and 80% thought that the cost of the new employer duties regime from 2012 would most likely be met by reduced pay or benefits for employees. This suggests that there would be strong support for the DWP’s proposal to delay the introduction of the higher levels of contributions required under the employer duties regime until 2015.
The poll took place at Punter Southall Group's London Pensions Conference Pension schemes – survival of the fittest?, which was attended by some 130 pensions trustees, corporate sponsors and pension managers from across the pensions industry.
Speakers from the actuarial, investment and private client specialisms spoke to the audience about how – on the eve of the centenary of Darwin's theory of evolution – they should adapt to survive the new regulatory and investment environment.
David Willetts MP, Senior Adviser to Punter Southall, chaired the conference, and opened discussion by asking whether corporate defined benefit schemes were heading towards an extinction event in favour of more nimble, flexible pensions arrangements.
Amongst other speakers, Matthew Furniss, senior consultant and head of longevity solutions at Punter Southall, spoke about the suitability of longevity hedging and its likely impact on corporate ability to manage scheme liabilities better.
Glyn Jones, managing director of P-Solve Asset Solutions, spoke about how trustees could ensure that 'intelligent design' could help their investment strategies meet future challenges.
Henry Denne, Head of the Private Client Practice at Punter Southall Financial Management, explained how the changes introduced by the Finance Act 2009 had resulted in a new hierarchy of tax efficiency for retirement savings, whilst colleague Neil Latham spoke about how employers should adapt to survive the new pensions obligations after the introduction of auto-enrolment rules in 2012.
The keynote speaker at the event was Anthony Hilton, Financial Editor of the London Evening Standard, who delivered a speech on the wider implications the economic environment will have on UK pensions.
Having taken the audience through the interactive voting session which dealt with the evolution of pension provision, Stuart Southall, Co-Founder of Punter Southall Group, noted:
"The findings from our audience reveal its good understanding of the challenges facing trustees, sponsors and managers at the moment. In these testing times and adverse environments, being well-informed as a pensions trustee or scheme sponsor will be key to the successful adaption and evolution of schemes."
Ends
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Trustee training - Pension scheme investment (September 2010)
