DWP concerned over pensions accounting
DWP to step in over City oncerns over lowered pension values
The Department for Work and Pensions could step in to urge the Accounting
Standards Board to look again at potential changes in the way companies account
for their pension schemes.
Pensions minister Mike O’Brien told the Daily Telegraph that he
would make representations to the ASB over potential changes to the way pensions
are accounted for, due to concerns from the City that pension values could be
lowered under the new plans.
‘The level of concern about these changes is quite serious,’ said O’Brien.
The ASB launched a consultation paper in January that has been interpreted by
industry as estimating pension assets based on government bonds, which would
lower their value.
‘The ASB’s proposals are likely to further weaken defined benefit provision
in the UK, increasing scheme liabilities and undermining scheme sponsors’
willingness to provide these types of pensions,’ said NAPF chief executive
Joanne Segars.
Comments on the ASB’s discussion paper are requested by 14 July 2008.
Further reading:
View
the discussion paper here
Read
the Daily Telegraph’s story