Another pensions headline
Editorial: After the dust settled on the Robert Maxwell scandal, for many years pensions news was not exactly the stuff of dreams for journalists. But this year all that looks set to change, as pensions are now right up there alongside Britain's Olympic triumphs and conflict in the Middle East.
In her comment piece on Wednesday, chief executive of the Local Pensions Partnership Susan Martin urged the industry to counter the negative headlines about pensions with a proactive communication strategy to reassure members.
The fact that there were a number of unfavourable stories in the national news – the BBC published another news piece only a few days ago – could undermine confidence in the pensions system, particularly defined benefit.
Some say the news about BHS, Tata and low interest rates will prompt more members to request to transfer out of their DB scheme. While the figures do not seem to show a marked uptick, even those who compiled them said it was possible that transfer levels could edge up, albeit because of higher transfer rates.
If trust is indeed being undermined by this year’s pensions news, the question is of course whether this is justified as far as members’ money goes.
Martin rejects the idea that 2016 is pensions’ ‘annus horribilis’, but admits a rethink is needed – without revealing, in practical terms, what this new direction should be.
While everyone seems to agree that something must be done to keep DB pensions sustainable, there is not much consensus on how to do this.
While a solution will be fought over by various groups – pensioners, employers, government etc – the risk is that the funding hole will keep growing in the meantime.
It will be a tough task to find a compromise that satisfies all, or most, of the stakeholders, and it might be a while before pensions are out of the news again. In the meantime, it is the task of journalists to report what is happening. Let’s see what headlines the rest of the year will bring.
Sandra Wolf is editor at Pensions Expert. You can follow her on Twitter @SandraCWK and the team @pensions_expert.