Defined BenefitAug 17 2018

No guarantees of annual bonuses to Superfund members

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No guarantees of annual bonuses to Superfund members
ByMaria Espadinha

According to Gareth Strange, lead of OneDB - a management service for final salary plans - at Willis Towers Watson, the "creation of a structure where member benefits can be enhanced will spike the interest of both corporate sponsors and trustees".

He said: "However, it is clear that the trustees of The Pension Superfund will need to be cautious when allocating the surplus to enhance members benefits.

If the situation is reversed and they find themselves in deficit they only have the money in the buffer to act as a remedy so they may wish to hold a surplus in the Superfund to reduce risk”

Alistair Cunningham, chartered financial planner at Wingate Financial Planning, said he was not entirely "clear how the Superfund will benefit members".

He said: "It may seem that there will be economies of scale in consolidating benefits, but even if there were, the retention of any annual bonus may mean members did not benefit."

maria.espadinha@ft.com

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