PTL Blog

Brexit Investment Implications for UK Pension Schemes

Posted by Donny Hay on Jul 17, 2017 3:03:48 PM

The results of PTL’s recent Defined Benefit (DB) Risk survey (click here to see the results) showed that Brexit was one of trustees’ top three DB risks. So, one year on, what has happened, what are the risks and how can trustees mitigate them?

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Topics: Defined Benefit, defined benefit risks

Tour de FCA

Posted by Colin Musgreaves on Jul 13, 2017 10:15:00 AM

No doubt the second biggest event of the summer has been the release of the FCA Asset Management Study, albeit that it is a long way behind the start of the Tour De France - but they have something in common.

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Topics: Defined Benefit, DB Risks

Who wants to live forever?

Posted by Eddie Hopkins on Jul 12, 2017 2:17:22 PM

Apart from being a massive hit for Queen, this is a phrase that haunts Defined Benefit (DB) Trustees and Employers at each triennial valuation. Time after time the actuary comes to the table with the news the pension scheme members are expected to live longer, “It’s a Hard Life” for schemes “Under Pressure” of increasing liabilities.

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Topics: Defined Benefit, DB Risks

Investment Transaction Costs: Your duty to ask

Posted by Richard Butcher on Jun 26, 2017 10:11:16 AM

I started my career at a time when the only paper emerging from a computer’s printer had pale green lines across it and perforations down the side, it folded at A3 intervals to form neat orderly piles that would gradually brown as they sat on the edge of your desk.

It’s the mental image of this stuff that comes to mind every time I think about investment transaction costs. Line after line of computer generated data detailing the up to, we think, 46 costs that could be incurred on each and every trade your fund manager makes. Terabytes of data – albeit more probably shared electronically these days. 

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Topics: Transaction costs, cost transparency, value for money, pension charges, investment transaction costs

The new pensions minister - time for another change?

Posted by Richard Butcher on Jun 22, 2017 2:55:14 PM

First published in Professional Pensions, 22 June 2017

The role should be scrapped as pensions are too important to mess with.

So it's official. Richard Harrington was moved off the pensions brief after just 11 months. We then had a void for a week or two before finally, Guy Opperman was named as the new chap - albeit with an apparently extended (diluted?) brief to include financial inclusion. I welcome him and wish him luck. The cynic in me, however, also wonders how long it will be before I welcome and wish luck to his replacement. 

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Transaction cost debate: where to next?

Posted by Donny Hay on Jun 21, 2017 3:39:15 PM

First published in Pension Funds Online, 09 June 2017

The asset management industry is not used to having the spotlight shone on it, however it has come as a result of the debate on costs and charges. Donny Hay looks at the importance of transparency when dealing with costs.

In her January 2017 article titled "Understanding the transaction cost debate" my colleague Alison Bostock asked how DC trustees and Investment Governance Committees (IGCs) can meet their duty to assess whether transaction costs are value for money.

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Topics: sustainability

What is your plan B? The question few scheme managers dare to ask

Posted by Richard Butcher on May 31, 2017 10:48:23 AM

If you want to know if your service provider will be around long enough to service your pension scheme, ask them how they propose to adapt, says Richard Butcher, managing director of PTL.

There are, it is said, only two things in life that are certain: death and taxes. Despite this (and even though we spend a lot of time talking about tax) death is an almost taboo subject for discussion.

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Topics: sustainability

Counterparties come to the party

Posted by Richard Butcher on May 24, 2017 11:22:00 AM

First published in Engaged Investor, 24 May 2017

Richard Butcher, managing director of PTL talks about his bugbear in any investment mandate but particularly a fiduciary one, that it is rarely clear who is involved.

I’ve got teenage kids and as a consequence, one of my recurring nightmares is the “facebook party”. You’ll have heard about these. Your teenage child asks “can I have a few friends round while you’re out on Saturday?” You reply, “Sure, but not too many and behave yourselves.”

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Increasing Deficits: A time to panic?

Posted by Richard Butcher on May 15, 2017 3:57:52 PM

Barely a month goes by without one of the trade papers publishing the headline that the combined pension deficit of the U.K.s largest companies has shot up/dropped (delete as appropriate) by some incredibly large number. The sensationalism of the headline will directly correlate with the number. This month those headlines were augmented by comments from Mercer suggesting that the recent slowing down of life expectancy improvements had wiped £2.5bn off the combined deficit.

Hmmm. It's time to pause for a moment and reflect on all this excitement.

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Topics: deficit

How to ensure your consultants are not conflicted

Posted by Matt Riley on May 4, 2017 11:53:51 AM

First published in Pensions Expert, 03 May 2017

Trustees are required to seek specialist advice when running their scheme and in doing so, conflicts of interest are likely to arise. 

Most important though is how these are either handled or mitigated as good governance is an essential part of running a pension scheme. 

There are some crucial points to consider for your scheme when evaluating the role of consultants.

Identify and record risks

One of them is identifying risks. Prepare a protocol to help identify risks and check that your policy specifically considers consultant conflicts, such as instances where the individual (or their firm) also advises the company. If this is not done, the independence of the advice could be called into question later.Advisers may well be conflicted, but this should not stop you from working with them. The trick is to identify and manage the conflict and mitigate your exposure.Make sure you record the range of risks facing the scheme that have been identified. A conflicts of interest register should be maintained recording the conflict and how it is being mitigated.When looking to appoint a new adviser, trustees should ask prospective advisers whether they have any existing conflicts or anticipate any in the future. Most advisers will be used to undertaking these checks, so this should not be a major problem.

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Topics: pensions pensionconsultants