KPMG Pensions's 2012 Member Options Survey examines market developments for Enhanced Transfer Value, Pension Increase Exchange and Flexible Retirement Option exercises.
KPMG's third survey on asset-backed funding for pensions shows how the market has developed over the last three years, and looks at the reasons why we believe we will see material growth in 2013.
Pension deficits are proving frustratingly persistent. Markets are running adversely, regulators are providing no respite. Meanwhile employers look to retain cash to strengthen balance sheets. This landscape looks set to pitch Trustees and Employers into battle. But we believe it is time to RE THINK - because Trustee and Employer goals are fundamentally aligned, and there are opportunities for genuine “win-wins”.
KPMG's Pensions Accounting Survey 2012 looks at trends in best estimate assumptions based on the experience of 310 of KPMG's audit clients with UK defined benefit obligations reporting under IFRS or equivalent at 31 December 2011. Our survey this year includes a feature on the upcoming changes to IAS19, which discusses some of the more subtle changes.
According to the latest research issued by KPMG Investment Advisory, UK Liability Driven Investment (LDI) assets under management have increased 28 percent to £312 billion in the 12 months to December 2011. However, despite this growth, the aggregate new asset inflow into LDI investments from UK pension funds was close to nil over 2011.
Since we issued our Enhanced transfer value (“ETV”) survey in August 2011 there has been continuing activity in this area both in terms of the number and variety of exercises being carried out and also the level of scrutiny and intervention from regulators.
Phasing in from 2012, employers must take responsibility for enrolling all eligible UK employees into a qualifying pension scheme. This will inevitably lead to increases in costs and administrative complexity, and employers have to act - if they do not comply, they will be liable for fines. KPMG Pensions has developed a standard approach to help clients plan for and manage the impact of Auto-enrolment.
The latest edition provides an incisive update on how the market has developed over the year and how these structures are being used within the pensions industry.
KPMG has released the first market survey on Enhanced Transfer Value ("ETV") exercises. The KPMG “Enhanced Transfer Value” (ETV) survey shows that ETV exercises have grown increasingly common as a tool for employers to manage their pension risks and their use is set to increase. Over 90,000 defined benefit pension scheme members have been offered an ETV - a sum greater than their cash equivalent transfer value - in order to leave the scheme over the last three years, with another 70,000 expected this year.
The survey gives details on the types of offers made, the use of cash enhancements and the rates of member engagement and take-up.
- Read a copy of the press release and further information
With the market outlook uncertain, meeting pension commitments is growing concern for many companies running Defined Benefit (DB) pension schemes.
