Defined Benefit  

First superfund to begin accepting transfers

“Therefore, we’d expect those first applications to be submitted very quickly, and we may see the first transfers finalised in 2022,” he said. 

However TPR reuires clearance for every case, which means its initial assessment is not the final hurdle.

"We expect TPR to closely scrutinise all cases, paying particularly close attention to the first movers. Indeed, TPR notes that a number of key factors of their assessment, such as capital adequacy, will not be considered in detail until clearance applications are made.”

John Baines, partner and head of commercial consolidation at Aon, concurred, saying the approval came “at the right time for trustees who are concerned about sponsor covenant, or for sponsors who need a cheaper solution to the ‘pensions problem’ than buyout,” especially following the impact of Covid-19.

“More widely, trustees and sponsors should consider using this market development to revisit their long-term strategy and assess whether superfunds are a viable endgame option for their scheme.”

Benjamin Mercer is a reporter at FTAdviser's sister publication Pensions Expert