130514 Defined contribution poll
Tel: 020 7893 3456 Fax: 020 7487 3686 www.broadstoneltd.co.uk @Broadstone_Ltd
55 Baker Street London W1U 7EU
PRESS RELEASE 13 May 2014
BROADSTONE poll shows that trustees and sponsoring employers believe that defined benefit members will want to transfer to defined contribution At a high level breakfast seminar involving trustees and sponsoring employers, BROADSTONE Corporate Benefits asked attendees views for their views on the recent changes to pensions announced in the Budget. Our poll found that:
100% support the government’s decision to expand pension flexibility 68% expect defined benefit members to be tempted to take their transfer value and convert to defined contribution to access flexibilities. 90% of employers/trustees think that individuals will act prudently in retirement 73% expect annuities to remain a key part of retirement planning 14% support a government ban on transfer from defined benefit to defined contribution.
Commenting on this, David Brooks, BROADSTONE’s Technical Director, explained, “The wide-ranging changes mean that trustees and sponsoring employers need to move from ‘wait and see’ to taking action. Top of their list should be the need to review their default investment strategies to ensure that they remain relevant for the majority of their members. This is especially so when typically 96% of the members make use of the default strategies. “We found that trustees were happy to facilitate extra flexibilities, but did not want to end up running “drawdown” facilities during the retirement/ decumulation phase of savings. “Sponsoring employers should also review the benefit structures in their defined benefit schemes to ensure they remain fit for purpose in the changing world. Members use of trivial commutation and additional voluntary contributions are going to change with the Budget’s changes to the way members will structure their retirement income. By reviewing the schemes’, benefits employers could realise long-term cost savings as members have access to the fullest range of options possible. In many cases rules will need to be changed and this work should begin sooner rather than later.” Ends Broadstone Corporate Benefits Limited is authorised and regulated by the Financial Conduct Authority (Financial Services Register number 587699) and uses the trading name BROADSTONE™. Registered in England, number 07978187. Registered office 55 Baker Street, London W1U 7EU.
Tel: 020 7893 3456 Fax: 020 7487 3686
55 Baker Street London
www.broadstoneltd.co.uk
W1U 7EU
For press information contact: Jenette Greenwood / Oliver Parry, Redleaf Polhill 020 7832 4760 / [email protected]
Notes to editors: Broadstone Group [BROADSTONE] offers independent pensions advice and investment solutions to private clients and companies through highly qualified advisers in eight offices across the UK. All its advisors are professionally qualified and its relationship with clients is fees based. For companies, BROADSTONE designs and implements tailored, cost effective pension schemes, auto-enrolment solutions and employee benefit packages that help businesses attract and retain talent. For individuals, BROADSTONE provides personal financial planning and investment solutions that help clients and their families achieve their goals. BROADSTONE has been awarded the prestigious Chartered Financial Planner status for the fifth year in succession. The designation is awarded by the Chartered Insurance Institute to firms demonstrating highest quality advice and ethical good practice. Broadstone Corporate Benefits Limited, Broadstone Pensions & Investments Limited and Broadstone Wealth Management Limited are part of the Broadstone Group. Each company is authorised and regulated by the Financial Conduct Authority and uses the trading name BROADSTONE™.
55 Baker Street London W1U 7EU
PRESS RELEASE 13 May 2014
BROADSTONE poll shows that trustees and sponsoring employers believe that defined benefit members will want to transfer to defined contribution At a high level breakfast seminar involving trustees and sponsoring employers, BROADSTONE Corporate Benefits asked attendees views for their views on the recent changes to pensions announced in the Budget. Our poll found that:
100% support the government’s decision to expand pension flexibility 68% expect defined benefit members to be tempted to take their transfer value and convert to defined contribution to access flexibilities. 90% of employers/trustees think that individuals will act prudently in retirement 73% expect annuities to remain a key part of retirement planning 14% support a government ban on transfer from defined benefit to defined contribution.
Commenting on this, David Brooks, BROADSTONE’s Technical Director, explained, “The wide-ranging changes mean that trustees and sponsoring employers need to move from ‘wait and see’ to taking action. Top of their list should be the need to review their default investment strategies to ensure that they remain relevant for the majority of their members. This is especially so when typically 96% of the members make use of the default strategies. “We found that trustees were happy to facilitate extra flexibilities, but did not want to end up running “drawdown” facilities during the retirement/ decumulation phase of savings. “Sponsoring employers should also review the benefit structures in their defined benefit schemes to ensure they remain fit for purpose in the changing world. Members use of trivial commutation and additional voluntary contributions are going to change with the Budget’s changes to the way members will structure their retirement income. By reviewing the schemes’, benefits employers could realise long-term cost savings as members have access to the fullest range of options possible. In many cases rules will need to be changed and this work should begin sooner rather than later.” Ends Broadstone Corporate Benefits Limited is authorised and regulated by the Financial Conduct Authority (Financial Services Register number 587699) and uses the trading name BROADSTONE™. Registered in England, number 07978187. Registered office 55 Baker Street, London W1U 7EU.
Tel: 020 7893 3456 Fax: 020 7487 3686
55 Baker Street London
www.broadstoneltd.co.uk
W1U 7EU
For press information contact: Jenette Greenwood / Oliver Parry, Redleaf Polhill 020 7832 4760 / [email protected]
Notes to editors: Broadstone Group [BROADSTONE] offers independent pensions advice and investment solutions to private clients and companies through highly qualified advisers in eight offices across the UK. All its advisors are professionally qualified and its relationship with clients is fees based. For companies, BROADSTONE designs and implements tailored, cost effective pension schemes, auto-enrolment solutions and employee benefit packages that help businesses attract and retain talent. For individuals, BROADSTONE provides personal financial planning and investment solutions that help clients and their families achieve their goals. BROADSTONE has been awarded the prestigious Chartered Financial Planner status for the fifth year in succession. The designation is awarded by the Chartered Insurance Institute to firms demonstrating highest quality advice and ethical good practice. Broadstone Corporate Benefits Limited, Broadstone Pensions & Investments Limited and Broadstone Wealth Management Limited are part of the Broadstone Group. Each company is authorised and regulated by the Financial Conduct Authority and uses the trading name BROADSTONE™.
