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Defined Benefit

The Weekly Wrap: June 28 edition

By Lisa Botter | June 28, 2013

A round-up of the pensions industry stories published across the FT Group, from divorcing couples forced to raid pension pots to a plummet in gold prices.

Move to aid pensioners in insolvent company plans

Week in numbers 

  • 3% rise in PPF cap for every year over 20 years' service
  • Pension sharing orders up 8%
  • Gold at 3-year low

FT: The Department for Work and Pensions announced this week that the cap on benefits paid by the Pension Protection Fund is set to rise. Pensions minister Steve Webb said it will be increased by 3 per cent for each year of service over 20 years.

Little progress made on defined benefit pension deficits

FT: Research by consultancy PwC has found the UK’s biggest companies have made little progress in cutting pension deficits. The ability of FTSE 350 companies to support defined benefit pension scheme promises remained far below its 2007 level.

Divorcing couples forced to raid pension pots

FT: The number of pension sharing orders made in divorce cases that involved children increased year-on-year by 8 per cent to 2,533 in 2011, figures by Hugh James Solicitors have shown. This trend could mean less security for thousands in retirement, the company said.

Cost of inflation protection fuels interest in real assets

MandateWire: The rising cost of index-linked bonds and index-linked swaps has forced pension schemes to consider real assets to protect against inflation. Asset managers have developed funds with contractual links to inflation which include social housing loans, ground rent and infrastructure debt.

Gold sinks to near 3-year low as investors rush for exit

FT: There has been a rush among wealthy individuals and asset managers to dump gold. This makes it the latest asset to suffer a sell-off since US Federal Reserve chairman Ben Bernanke announced a framework to exit the country's quantitative easing stimulus programme.

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West Sussex turns off private equity tap
Pearson introduces three lifecycle options to increase choice

This week's social media comment

In response to a Pensions Week's story on the development of collective defined contribution in the UK, Aviva's John Lawson tweeted the following:

 
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