UK Pension Funds

UK Pensions - the top 12 papers of the Summer

Papers on deficit reduction, UK pensions strategy, risk transfer, DC fees, pensions governance and much more

Savvy Investor is the world's leading knowledge network for institutional investors, with over 13,800 members and a research library containing 12,000 white papers, including a section dedicated to UK pensions issues.

The Savvy Research team has curated this list of the most popular UK pensions papers from June-August 2016. Topics covered include devices to reduce pensions deficits, risk transfer and LDI, other strategies for pension funds, DC exit fees, pensions stewardship and pensions accounting.

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Strategic Perspectives for UK Pensions (BlackRock, Aug 2016)
This quarterly issue from BlackRock is aimed at UK investors, and considers the five year view for a variety of asset classes following the UK's EU referendum. BlackRock have lowered their return forecasts for most asset classes, reflecting the fall in bond yields and reduced global growth expectations. They have also increased their allocation to liability-hedging assets for UK pension portfolios. This issue also examines the path to pension buyout for investors with relevant liabilities.

Devices to Exploit Surpluses and Shed Deficits in Pension Schemes (Aug 2016)
This paper provides a history, from the 1980s and 1990s onwards, of the ways in which businesses have extracted surplus or sought to avoid deficits in their pension schemes.

2016 KPMG Survey of UK Liability-Driven Investing (June 2016)
The UK LDI market continues to grow strongly, with over £741bn of liabilities now believed to be hedged across the industry. KPMG has produced this definitive survey of the UK LDI marketplace, revealing that an additional 256 LDI mandates were deployed in 2015.

Risk Transfer Report (Hymans Robertson, Aug 2016)
This paper by Hymans Robertson tracks key changes and trends in the bulk annuity market across four important areas: bulk annuity insurers; insurance company strategies; regulation; and demand from DB schemes. The authors explain what these changes mean for UK DB pension schemes. They also give their expectations for the medium- to long-term and the possible implications for defined benefit pension schemes seeking to capture opportunities to transfer risk to insurance companies.

Survey on Exit Charges in UK DC Schemes (The Pensions Regulator, 2016)
This report summarises the results from the February - March 2016 research survey carried out by OMB Research, an independent market research agency, on behalf of The Pensions Regulator (the regulator). The report follows previous research on the prevalence of exit fees and charges in occupational pension schemes. The main objective of the research was to develop this evidence base further to inform the Department for Work and Pensions (DWP) consultation on an exit charge cap for members of occupational pension schemes.

Lessons on UK Pension Scheme Investment Governance (Aon Hewitt, Aug 2016)
The authors of this paper ask what 'good investment governance' looks like in today's UK DB pensions market. Since DB schemes were set up in the 1970s, the economy and investments have all changed and we have seen increasing globalisation.

BREXIT: What is the Impact on UK Pension Schemes? (July 2016)
The UK faces a prolonged period of uncertainty following its decision to vote to leave the EU in June this year. This paper by Freshfields Bruckhaus Deringer considers some of the implications for UK pensions and the options available for a new UK trade agreement with the EU.

De-Risking Journeys of Mid-Sized Pension Schemes (LGIM, June 2016)
This 50-page document examines the long-term de-risking objectives and strategies of mid-sized UK schemes - those with total assets of between £100 million and £1 billion.

A Stewardship Toolkit for Pension Funds (PLSA, July 2016)
In this document, the PLSA explains its stewardship toolkit for pension funds. The toolkit outlines different ways in which investors can engage directly with investee companies over workforce-related issues – for example, influencing the content of annual reports, face-to-face dialogue and voting at company AGMs. It is intended for the use of pension fund investors, but within that group different funds may find different ways to use it.

UBS Asset Management - Pension Fund Indicators (Aug 2016)
The Pension Fund Indicators (PFI) 2016 is an annual publication produced by UBS AM with an enduring aim of putting current topics in their long-term context. As an industry-standard text on pension fund investment we hope that you will find it a useful source of data and practical explanations.

KPMG's UK Pensions Accounting Survey (June 2016)
This survey by KPMG explores trends in best-estimate assumptions based on around 250 of the firm's UK DB pension scheme clients. The survey includes clients advised by top consultancies. It gives in-depth analysis into industry-wide practice aiding conversations that go beyond accounting.

DB Dynamics: Setting the liability hedge level (LGIM, June 2016)
In this edition of DB Dynamics, the authors present their hedging philosophy, explaining the factors they believe should be taken into account when setting the hedge level of a DB pension scheme.

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