DB taskforce to act on final salary pension problems

DB taskforce to act on final salary pension problems

Problems faced by people with defined benefit pension schemes will be investigated by a new taskforce of experts launched by the Pensions and Lifetime Savings Association.

The group of industry experts and academics will seek views and evidence from schemes of all sizes, as well as sponsors, intermediaries, regulators and the government.

Leading the team will be Ashok Gupta, the former deputy chair of the Bank of England’s pro-cyclicality working group.

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Mr Gupta said: “There is broad consensus that the pensions sector should provide long term sustainable outcomes for members and act as a powerful engine of growth to the economy.

“It is clear however, that for some time pension schemes have been grappling with a wide range of challenges, including scheme funding, changing regulatory requirements, and an uncertain macro-economy.

“These have hampered their ability to deliver this commonly agreed principle.”

The taskforce plans to report its initial findings in the summer, then at the PLSA annual conference in October it will announce recommendations to government to help ensure DB pensions are sustainable in the long term.

Joanne Segars, chief executive of the Pensions and Lifetime Savings Association (PLSA), said these problems are not going away any time soon.

She said: “The issue cannot be ignored because there are around 16m people in DB schemes and the health of those schemes can also have a material effect on employers, government and the wider economy.

“The DB taskforce will tease out the detail of these challenges and, equally importantly, set out possible solutions. Some of those solutions may be radical, but if we work together I am confident we can find the right answers.”

The taskforce is made up of figures such as Duncan Buchanan, a partner at Hogan Lovells and president of the Society of Pensions Professionals, Stephen Soper, a senior pensions adviser at PwC, and Paul Trickett, chairman of trustees of the Legal & General Mastertrust and Zurich UK pension scheme.