Aon warns of impending pensions crisis

Actuaries at Aon have
warned changes to accounting rules and revised longevity assumptions will add an
estimated £200bn to pension liabilities, threatening to plunge the UK back into
a pensions crisis.

‘The double whammy of (accounting) proposals and the regulator’s proposed
mortality assumptions throw the future of final-salary schemes into further
doubt. These proposals add more pressure on companies to close the schemes or
find ways to terminate their liabilities,’ Marcus Hurd, a senior Aon consultant,
told The Daily Telegraph.

Aon’s findings co-incides with a separate report which underlines the
widening gulf between private and public sector pensions. Research from the
think-tank Policy
reveales only 15% of private sector employees – 3.4m people – are
in final-salary schemes and of those only 900,000 are in schemes still open to
new members.

‘Tomorrow’s (private sector) pensioners are being required to take risks
themselves, whereas many companies had historically agreed to shoulder the
responsibility. The current pensions environment punishes companies for
demonstrating paternalism to their employers,’ Hurd said.

Further reading:

Regulatory changes alarm pension industry

FTSE 100 ’07 pension fund gains wiped

story in The Daily Telegraph

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