People and players
Given the complexity of the UK pensions system, there is a bewildering choice of people, firms and organisations that can help (see Market Knowledge). Like anything else, success generally depends on knowing what you want, understanding the market and finding someone who talks your language (see Adviser Selection).
Most UK pension schemes have a wealth of advisers. The law requires the appointment of certain advisers and regulates appointment formalities. Individual circumstances will differ, but a medium-sized final salary scheme could find itself with a scheme actuary, benefit consultant, administrator, investment adviser, investment manager, scheme lawyer, covenant adviser and accountant. Most employers will in addition appoint their own advisers.
Like anything else, success generally depends on knowing what you want, understanding the market and finding someone who talks your language
To reduce the number of advisers, some schemes take more than one service from a particular firm. The same firm may provide actuarial, benefit consulting, investment and covenant advice (although the scheme actuary must be an individual appointment). There may be efficiencies in such an approach but there may also be drawbacks. Whichever approach is adopted, it is important to check appointment terms (including limitation of liability and exclusion clauses), transparency, accountability and the potential for conflicts (see Governance Audit).
To reduce the number of advisers, some schemes take more than one service from a particular firm
Over recent years, it has become common for schemes and employers to appoint separate advisers in order to pre-empt conflict issues. Some employers and schemes maintain the earlier practice of using the same advisers, on the basis that the interests of employer and trustees are aligned for much of the time. If this approach is followed, there should be a clear agreement about what happens in the event that a conflict or potential conflict emerges (see Governance Audit).
Most of the big accounting firms have sizable pensions teams, and can advise on pensions strategy as well as the impact of pensions on company accounts. Teams may be cross-disciplinary, and include actuaries and consultants as well as accountants and lawyers. Some firms have a scheme advisory practice alongside their consulting work for employers.
There are a number of consulting firms that, while sizable, are smaller than the benefit consulting giants. Often established by partners from the bigger firms, some have developed specialities such as the negotiation of buy-out insurance contracts.
Various firms undertake pensions administration either as their main area of focus or as a part of other pensions-related services. The outsourcing of pensions administration has become increasingly popular.
Benefit consulting firms
A considerable range of firms offer actuarial advice, pensions and benefits consultancy and scheme administration. Many have their origins in firms of consulting actuaries, whose main business was scheme actuarial work preparing actuarial valuations. Over the years, these firms have expanded by merger and consolidation into more general human resource consultancy work, pensions and investment strategy, and investment manager selection alongside their pensions actuarial and consulting work.
Investment advisers and asset managers
The UK has a large and respected investment and fund management sector. There is no shortage of firms available to advise on and manage scheme investments. Some firms specialise in particular asset classes.
There is a wide choice of specialist pensions lawyers, both within and outside London. Some pension teams sit within corporate teams and specialise in the pensions aspects of corporate transactions, while others have a greater focus on scheme advisory work. Some firms have a reputation for litigation and disputes work. Others offer trusteeship services.
The UK maintains a separate Bar, and several sets of chambers are noted for their particular pensions experience. They are usually called on to advise on difficult areas of law, or in connection with disputes and court matters.
The Legal 500 and Chambers are the two principal legal directories.
A number of firms and individuals focus on particular aspects of pensions, such as projects or governance.
An increasing number of firms specialise in pension trustee appointments, either acting alone or as a member of the trustee board.
If you’d like help or more information please contact us.
The following list of pensions organisations may be helpful. It is not intended to be comprehensive.
National Association of Pension Funds
Pensions Management Institute
Association of Consulting Actuaries
Association of Pension Lawyers
Department of Work and Pensions
Pension Schemes Office
The Pensions Regulator