Press Releases

Without a clear end game approach, Trustees are unable to plan for the correct investment strategy warns Hymans Robertson, as the latest update to the Excellence in Endgame insights hub is released. Trustees must have a clear understanding of their end-game approach, prior to choosing an investment strategy, to ensure the level of returns, risk and timescales align.

Accounting issues may deter DB pension schemes from run-on and surplus sharing if a clear accounting framework is not considered by the sponsor, warns Hymans Robertson, as it releases its latest paper, Accounting implications of run-on and surplus sharing. With many DB schemes now facing improved funding levels, and the option of a run-on strategy becoming more of a reality for some, a clear accounting strategy must be thought through. Against the backdrop of a transforming political landscape with opportunities developing from the Mansion House reforms and potentially new legalisation post-election, care must be taken when agreeing an accounting framework.

Commenting on the Bank of England’s interest rate hold at 5.25%, Ben Farmer, Senior Investment Consultant, Hymans Robertson says:

“Headline inflation may now be back at the 2% target, but this has mainly been driven by falling energy and food prices weighing on the year-on-year comparison. Good news for some, with the energy price cap falling, alongside the price of chocolate (among other things)! However, the Bank of England (BoE) pays closer attention to core inflation – stripping out the volatile energy and food measures – which remains elevated at 3.5%. Other measures that the BoE tracks closely, such as wage growth and services inflation, have also stayed high. As such, the BoE’s decision to hold the base rate steady at 5.25% was widely anticipated and is unlikely to move the dial in markets...

Errors in DC scheme contributions, such as incorrect contribution percentages and the incorrect application of tax relief, are becoming increasingly commonplace, claims Hymans Robertson. These can result in both under or over payments which employers need to identify and correct quickly, warns the leading pensions and financial services consultancy. The firm estimates that the average DC pension scheme member could be at risk of losing contributions which are worth up to £12k in retirement. In its new guide ‘Spotlight on pension contribution accuracy and The Pensions Regulator’s requirements’ LINK, it warns employers to proactively review their scheme’s DC contribution compliance and review their payments. By taking the time to do so, all organisations regardless of size, can help avoid costly mistakes.

DB Trustees and sponsors must share a common vision when considering run-on says Hymans Robertson, as its latest update to the Excellence in Endgame insights hub is released. The firm warns a common vision is vital; without one there’s a risk of wasting management time and excessive spending on advisor costs, with both parties pulling in opposite directions for their desired end goals. The majority of practical issues can also be resolved fairly easily if there is a common shared purpose.

DB schemes with assets between £10m and £250m are the new ‘squeezed middle’, says Hymans Robertson as the firm releases the latest update to its ‘Excellence in Endgames’ insights hub. The leading pensions and financial services consultancy highlights that endgame options are likely to be more limited for this squeezed middle than for both larger and smaller schemes.

Comments from Michael Abramson and Nick Ford following the release of PRA's Review of Solvency II: Reform of the Matching Adjustment.

Triennial valuations for DB schemes are taking place against a background of change, warns Hymans Robertson as the firm releases the latest 2024 update to their valuation series. Improved funding levels, increased affordability for buy-out and a forthcoming general election are likely to impact pension scheme funding and employer covenant, as DB schemes undertake one of their most important risk management activities.

Employers with Defined Benefit (DB) pension schemes focusing on insurance buy-out, must become more proactive to avoid the risk of trapped surplus, warns Hymans Robertson, as the firm releases the latest update to their 2024 Corporate Valuation series.  Improved funding levels, following on from an unprecedented rise in yields, present an opportunity for DB schemes. However, many do not have appropriate plans in place to ensure efficient use of any emerging surplus, which leads to “trapped surplus”.  

Commenting on the ONS Consumer Price Inflation update, Chris Arcari, Head of Capital Markets, Hymans Robertson, said:

“Headline inflation fell to 2.3% year-on-year in April 2024, from 3.2% in March, but by less than expected (the BoE and economists had expected inflation to fall to 2.1%). We still expect headline inflation to fall close to, or even below, target in the coming months, as energy prices and goods and food price disinflation weigh on the year-on-year comparison. However, we expect the Bank of England to pay close attention to core and service-sector inflation, as a better guide to underlying inflation pressures...

The need for DB schemes to think carefully before deciding on their insurance endgame options has never been more pertinent, states Hymans Robertson as the firm releases the latest update to their ‘Excellence in Endgames’ insights hub.