7 days

7 Days is a weekly round up of developments in pensions, normally published on Monday afternoons. We collate this information from key industry sources, such as the DWP, HMRC and TPR.

In this 7 Days:

ABI publishes specimen annuity rates
Joint Forum publishes consultation on longevity risk transfer markets
DWP statistics reveal increase in number of older workers in the workforce
TPAS launches new Web Chat tool
Perceptions of TPR published
O’Brien v Ministry of Justice (Employment Tribunal)

ABI publishes specimen annuity rates

On 22 August 2013, the ABI published on its website specimen annuity ratesoffered by its members based on 12 example customer profiles.

The specimen annuity rates are part of the ABI’s Retirement Choice Code, launched earlier in 2013, an initiative aimed at helping those approaching retirement to gain a better understanding of their options and to shop around for the best annuity for their circumstances.

The ABI notes that the publication of the specimen annuity rates is not designed to be a price comparison website, rather to illustrate what is available in the market and the need to get advice.

Joint Forum publishes consultation on longevity risk transfer markets

The Joint Forum (made up of the Basel Committee on Banking Supervision, the International Organization of Securities Commissions, and the International Association of Insurance Supervisors) has published a consultation on longevity risk transfers markets: Market structure, growth drivers and impediments, and potential risks.

As the consultation notes, the ageing population phenomenon being observed in many countries poses serious social policy challenges. Longevity risk – the risk of paying out on pensions and annuities longer than anticipated – is significant when measured from a financial perspective. By way of example, certain estimates of the total global amount of annuity- and pension-related longevity risk exposure range from USD 15 trillion to USD 25 trillion. At the same time, pension funds are increasingly looking for ways to hedge or transfer this exposure.

The Joint Forum seeks to draw attention to this issue, with a view to helping set appropriate policies and to help ensure effective supervision of related activities and risk.

The consultation closes on 18 October 2013.

DWP statistics reveal increase in number of older workers in the workforce

According to the latest official statistics, the number of people aged between 50 and 64 in employment in the UK has increased by nearly 2 million over the past 15 years, with a higher employment rate than before the recession. An extra 54,000 workers in this age group were in jobs during the last quarter (April to June 213), boosting the total number of 50 to 64 year olds in work to almost 7.7 million.

TPAS launches new Web Chat tool

TPAS has launched a new online service called Web Chat which will be available Monday – Friday 9am – 5pm.

Web Chat provides a new way for pension experts to talk online in real time with people who have pension queries or just need some help understanding pensions.

Perceptions of TPR published

TPR has published the latest TPR perception tracker survey, detailing key findings from the ninth annual survey exploring industry perceptions of its office and work.

Some of the key findings of the research include:

respondents who consider TPR’s performance to be ‘very good’ or ‘good’ remained broadly unchanged at 66% (compared with 64% in 2012);
30% of those who consider TPR’s performance to be ‘very good’ say this has improved in the past year;
significant improvements in perceptions of TPR’s effectiveness at ‘strengthening the funding of DB schemes’, up from 65% to 75%, and ‘reducing the risks of claims to the PPF, up from 55% to 68%;
new this year, the survey also included perceptions of the regulator’s ability to protect members of DC schemes (75% said ‘very’ or ‘fairly’ effective), and maximising employer compliance with their automatic enrolment duties (66% said ‘very’ or ‘fairly’ effective);
97% of respondents view TPR’s website as ‘very’ or ‘fairly’ useful. 94% rate the Trustee toolkit in the same way;
TPR continued to meet the 70% average agreement with the ‘PACTT Better Regulation’ Principles, specifically: to be proportionate, accountable, consistent, transparent and targeted.

The survey is carried out to provide TPR with an understanding of how effectively it is perceived to be fulfilling its remit to promote and improve understanding of the good administration of workplace pension schemes. DWP press release.