There is widespread adoption of AI within the UK pensions industry, with 87% of respondents to a recent SPP survey confirming that AI is being used by their firm. However, the survey also revealed that more than three quarters of respondents (77%) currently used AI in only 1%-5% of their services, suggesting that there is great potential for future use. This response provides further detail about such usage.
The SPP believe that the FRC have done a good job in dealing with what is an increasingly complex area. However, there are some improvements that could be made, both for clarity and to reduce the amount of work needed that wouldn’t add material value to the advice. If these changes are made, the new Technical Actuarial Standard for pensions is likely to provide strong support for practitioners carrying out actuarial work under the new DB funding regime.
This is a short response to the FCA Discussion Paper, focusing on just one of the nine questions, the important issue of Transfer Regulations. The regulations continue to result in delays in transfer processing; don’t align with the original policy intent and are causing schemes and members considerable problems. As a result, this response highlights industry concerns with a view to securing a practical solution.
The SPP’s response to the FCA consultation on a new type of support for consumers with their pensions, called targeted support, as part of their Advice Guidance Boundary Review. This response highlights our support for certain proposals e.g. around readymade solutions and the potential for reducing consumer harm, whilst highlighting potential issues with other elements of the proposed changes
The Society of Pension Professionals (SPP) analysis of Government plans to impose Inheritance Tax on unused pension pots from April 2027 - and "less costly, quicker, and ultimately more effective” alternatives.
The Society of Pension Professionals (SPP) supports the Government’s overarching objectives to both invest more in the UK and boost saver returns. However, we aren’t convinced that these proposals are the best way to achieve this.
A minimum pension fund scale of £25bn AUM isn’t necessarily going to drive additional investment diversification or deliver better saver returns but could lead to unintended consequences of reducing competition, stifling innovation and potentially disadvantaging some minority groups.
Whilst it is right for the Government to challenge the LGPS to assess its progress, the type and pace of changes being proposed run the risk of derailing some of the good work of the last decade, as well as impinging on administering authorities’ fiduciary duties. Within the LGPS it is not clear how these proposals will meet either of the Government’s objectives of improving pension outcomes for members or increasing investment in the UK.
As a result, the Society of Pension Professionals (SPP) urges policymakers to carefully reconsider both the nature and pace of some of these proposals.
The Society of Pension Professionals (SPP) supports the Government’s efforts to legislate for the introduction of Collective Defined Contribution (CDC) legislation for multi-employer and master trust arrangements. However, we urge the Government to revisit a small number of areas that could be improved. For example, in relation to promotion and marketing activities; the potential to inadvertently transition between the connected and unconnected employer regimes; and the proposed constraints on changes in investment strategy, with the associated requirement to sectionalise.
The Society of Pension Professionals (SPP) response explains that the PPF continues to levy £100m annually from the pensions industry which it readily admits it does not expect to ever need given it has a multi-billion pound surplus. Existing legislation prevents any future increases beyond 25% but the levy could be immediately reduced to zero whilst legislative change is sought (either now or in the future).
The Society of Pension Professionals (SPP) supports many of the proposals being put forward within this consultation and the overarching objective of improving Value for Money but is concerned about the volume of data that the proposed framework will require providers to collect and communicate, which in some cases appears disproportionate. There are many improvements that could be made to these proposals, as we have sought to constructively explain in this response.
Amongst other productive finance issues, this response highlights that the SPP agrees that scale can deliver improved investment but that there are risks, which must be guarded against; that legislative change is necessary to better facilitate consolidation and that for the LGPS, asset pooling has been successful but there is more to do. Read on for further information...
The SPP members report widespread use of the PSIG Code of Good Practice and that the Pension Scams Industry Forum is useful. However, greater clarity on PSIGs remit and activities is essential and SPP does not believe that now is the right time to consider funding arrangements.