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14-Oct-08 11:30 [Pensions]
NAPF: Four key issues with pensions The National Association of Pension Funds (NAPF) has listed four areas where UK pensions regulation is "out of step" with other international practices.
Comparing the UK's schemes with five other countries which also harbour large private pension sectors - the Netherlands, Ireland, Australia, Germany and the US - four common problems arose.
Firstly, defined benefit (DB) inflation proofing in the UK was not in touch with its international counterparts, making schemes more expensive than in other countries.
Additionally, the NAPF said that DB covenant regulation was restricted in its abilities by mandatory indexation, with DB contract-based provision needing consideration from management committees, annual reviews and default funds.
Finally, the governance of pension funds should be assessed in trust-based schemes.
NAPF director of policy Nigel Peaple said: "We hope the analysis will help promote informed discussion on how the regulatory framework in the UK should evolve in the future."
Prior to joining the NAPF, Mr Peaple worked with the Association of British Insurers as a pensions and savings expert.
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