KPMG fires pension fund trustees

Link: KPMG pension fund members face 20% shortfall

The move has caused consternation among members of the fund who have expressed worries about its management and whether it is adequately funded.

KPMG wrote to members on 17 January informing them of a change in the trustees from Capita Trustee Services to Aon Trust Corporation.

Ian Robinson, UK head of human resources, this week denied that the change had come about because the former trustees had been seeking more money from the firm to meet the shortfall in the £300m fund.

He said the change in trustees came about as part of a general review of KPMG’s pension arrangements and that it was the ‘right thing to do for the members’.

One member said: ‘There’s now a lot of uncertainty around this issue and a clear lack of trust in the partnership to fulfil its obligations.’

In June last year, Capita wrote to members informing them that they believed the shortfall in the fund would be in the order of 20% and that advances to the firm for more money had been rebuffed. At the time, KPMG maintained it had met obligations to the ‘trust deed’ and would make no ‘discretionary’ payments.

KPMG will not comment on whether it should contribute more money to the fund because it says actuarial valuations up to the end of March 2002 have not been finalised. Indeed the firm believes only the valuation will determine whether there is or is not a shortfall. Capita insisted in its June letter that it had kept the fund ‘under review’ and as a result was ‘clear that the 31 March 2002 valuation will reveal a deficit’.

KPMG’s Ian Robinson also said the firm intends to push ahead with a court hearing to clarify its obligations. The fund was formed in 1949 and since then legislative changes may well have changed the responsibilities of those involved.

In its letter to fund members, Aon said it was discussing the issues with Capita and asked for time to ‘familiarise’ itself with the fund.

Capita confirmed it was no longer trustee to the fund.

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