Search the News Archive

In the UK, DB Industry Calls Time Out on Its Love Affair with Equities

"[O]ver the next 12 months, 41% of UK pension schemes expect to reduce their exposure to UK equities, with 28% planning a reduction in allocations to global equities throughout 2013. However, some pension schemes said that they see equities as a buying opportunity indicating the traffic is not all one-way."  MORE >>

UK Pension Funds Struggle with Asset Allocation

"Equity allocations for UK pension schemes fell from 61% in 2002 to 56% in 2007, and to 45% in 2012, according to data from Towers Watson. However, UK pension funds have increased their exposure to alternative assets from 3% to an average of 17% over the past decade and allocations to bonds have also increased over the past five years -- from 30% in 2007 to 37% in 2012."  MORE >>

UK's Radical Shake-Up of State Pensions

"Pension reform is sweeping the UK and while experts chime in on the latest reforms, the reality is that Brits will be asked to work longer, contribute more and most will receive less in retirement. And the truth is these reforms won't make a difference for those already facing looming pension poverty.... What the UK really needs is major pension reform, introducing a national plan similar to the Canada Pension Plan Investment Board."

MORE >>

Improving All Types of Saving With the UK's Expanded Retirement Savings Platform

"Known in the UK under the term 'corporate platform' ... the development allows employees to use the employer's retirement savings mechanism to save and invest for additional nonretirement purposes.... Although the UK's platform is intended as an enhancement to employer-provided benefits, it can also be used for a wide variety of policy goals, as the basic structure can be easily adapted to meet almost any nation's specific tax and savings system. In the United States alone, policy experts have proposed dedicated savings accounts for nonretirement purposes ranging from unemployment benefits and retraining, home purchases, health care, and long-term health care coverage, to repaying student loans or building college balances for children or grandchildren."

MORE >>

UK Pension Funds Break the Worst Kind of Records

"The aggregate deficit of pension funds in the United Kingdom has reached its lowest point since records began seven years ago, data has shown. The Pension Protection Fund (PPF), the lifeboat for bankrupt company funds in the UK, said the combined deficit across the industry had ballooned from 216.8 billion [GBP] at the end of April to 312.1 billion at the end of last month. A year earlier the deficit was 24.5 billion."

MORE >>

McDonald's UK CEO: Kids Are Fat Because of Video Games

Excerpt: Steve Easterbrook, the CEO of McDonald's UK, says that video games cause obesity -- not his nutritionally void, heavily sweetened, processed junk that's voraciously marketed to kids[.]  MORE >>

New Funding Pitfalls for UK Pensions

Excerpt: To make sure that pension promises are kept and to address the increasing cost of longevity, the United Kingdom recently enacted new laws fundamentally changing the way in which UK pensions must be funded. This Commentary provides a brief overview of the key issues confronting UK businesses sponsoring underfunded pension plans.  MORE >>

Report: UK Occupational Pension Provision in the Public Sector (PDF)

56 pages. Excerpt: This paper has been prepared to give factual background to the important political debate now taking place on reforming public sector schemes. .... After a brief introduction to the UK public sector schemes, the first chapter of this paper examines how much they cost. The paper then goes on to assess the value of their benefits, before and after reform, compared to those in the private sector.

MORE >>

UK Employer Gets to Keep Surplus Pension Assets

Excerpt: The UK's power supply industry will not have to pay back [one billion pounds] in surplus pension contributions to its retired workers following a landmark ruling in the House of Lords.  MORE >>

UK Eyes Higher Allowances for Pension Investments in Infrastructure

"Local government pension funds are allowed to invest only up to 15 percent of their assets in partnership structures, such as limited partnerships, which are common among real estate, private equity and infrastructure funds. The new proposals increase the current limit to 30 percent."  MORE >>

UK Pension Funds May Rank Fund Investment Managers on Efforts to Improve Corporate Governance

"Britain's pension funds are weighing up plans to rank fund managers based on their efforts to improve performance at the companies they back, in the latest sign of institutional investors flexing their muscles. Umbrella body The National Association of Pension Funds is leading a campaign to develop a framework that would rate fund managers according to their work towards, for example, improving governance at companies."  MORE >>

UK Legislation to Give Shareholders Power Over Executive Pay

"The plans will strengthen the hand of shareholders who currently only have an advisory and non-binding vote on directors' remuneration.... The move follows measures to limit the level of banker's [sic] bonuses following the financial crisis and comes as the European Union considers similar proposals to boost shareholder control over director pay.... Shareholders, led by insurers and large pension funds, have become increasingly critical of what they regard as overgenerous pay for senior executives, especially where corporate performance has been disappointing."  MORE >>

UK Employment Alert: The Necessity of Time Off for Dependant Care

Excerpt: The key question in deciding whether an employee can take time off for dependants is therefore whether the time off is 'necessary'. In deciding what is necessary, an Employment Tribunal will look at all the circumstances, including the time between the employee learning of the disruption and the date of the disruption, the availability of alternatives, the nature of the disruption and finance.

MORE >>

Securities Basics for a Foreign-Based Company When Offering to Employees Based in the U.S. or UK (PDF)

2 pages. Excerpt: Foreign sponsors of equity incentive plans (stock option, restricted stock option plans, etc.) often assume that if their plans comply with local securities laws they will automatically meet the requirements of foreign jurisdictions. This is typically not true.

MORE >>

Report: Shaping a Stable Pensions Solution -- How Pension Experts Would Reform UK Pensions (PDF)

82 pages. Excerpt: [A] series of seminars in which pensions experts debated papers written by specialists on the most critical and topical pension policy issues [is summarized in the report chapters]. Points of consensus from the seminar debates are presented at the end of each chapter in a box. Points raised during the seminar discussions are shown in italics, boxed and presented at various stages through the chapters.

MORE >>

Reforming the UK Retirement System: Privatization Plus a Safety Net (PDF)

16 pages. Excerpt: Going forward, Britain's retirement income system will increasingly rely on individual accounts and means-tested assistance. The individual accounts are not well funded and carry significant risk. The disincentive to work or save created by the expanded means-tested program across a broad range of households further clouds the system's prospects. As a result, observers generally expect an increase in public expenditures on the elderly and further reforms to the system.  MORE >>

UK Government: New 401(k)-Like 'Individual Pension Accounts' Will Help People Save for The Future

"The advantages of IPAs in pensions saving include a simple charging structure, spread investment risk, security, transparency, and better understanding and confidence in equity investment. The IPA concept was based in part on the popular and successful US 401(k) savings scheme, which has encouraged savings generally, and equity savings in particular."  MORE >>

Federal District Court Tosses Fiduciary Breach Lawsuit Against Prudential

"The lawsuit, originally filed in November 2019, alleged that Prudential breached its fiduciary duties under ERISA by overpopulating the plan with proprietary mutual funds, failing to monitor the performance of those funds, and neglecting to adequately disclose the amount of record-keeping fees received by Prudential ... The plaintiff also accused Prudential of engaging in prohibited transactions[.]" [Cho v. The Prudential Ins. Co. of America, No. 19-19886 (D.N.J. Sep. 27, 2021)]  MORE >>

Rollins Inc. 401(k) Participant Sues Morningstar, Prudential Over Alleged RICO Violations

"The complaint said Morningstar and Prudential violated the Racketeer Influenced and Corrupt Organization [RICO] Act by engaging in a 'conspiracy' to increase revenue and profits 'from their self-interested administration' of GoalMaker, an 'automated investment advice program' from Morningstar and Prudential. Alleging GoalMaker is a 'predatory racketeering enterprise,' the lawsuit argued that it 'gets retirement plan investors to turn over the investment management of their accounts' to a unit of Prudential." [Green v. Morningstar, Inc., No. 17-5652 (N.D. Ill., complaint filed Aug. 3, 2017)]  MORE >>

The Four Pillars and Public Policy: Prudential's Positions on Legislative and Regulatory Issues Impacting Retirement Security in America (PDF)

Prudential has developed the 'Four Pillars of U.S. Retirement' as a framework to discuss how Americans will prepare for and live in retirement. The Four Pillars have their origin in the traditional 'three-legged stool' of retirement security: Social Security, Employment-Based Retirement Plans, and Personal Savings. To this, Prudential has added a fourth Pillar, Retirement Choices, to capture lifestyle and financialconsiderations for today's and tomorrow's retirees.

MORE >>