From IDS Pensions Bulletin 205, May 2007

Company news

• BA cabin crew accept pensions deal
• Unilever moves to a mixed average salary and defined contribution design
• Government agrees loan to Royal Mail

Regulatory round-up

• Taking control of ‘pension input periods’
• FSA publishes information on SIPPs

Investment returns show DB schemes beating their benchmarks

Recent research undertaken by the IDS Pensions Service has found that among 82 defined benefit schemes which had a bespoke benchmark, 60 schemes either beat or equalled that benchmark. It also found that among the 85 defined benefit schemes with investment year ends on 31 March 2006 the overall return achieved over the year ranged from 29.4 per cent to 14.4 per cent, while Mellon Analytical Solutions reports that median scheme at that date returned 23.1 per cent.

Comment

Alan Hubbard, Chief Operating Officer at DC Link Limited, argues that defined contribution savings are far from adequate and that employers and their advisers should offer more support and better communications on pensions during member enrolment.