Need to know
I read with interest the letters by Chris O’Brien, Craig Turnbull and Jon Spain in recent issues, debating that elemental actuarial topic of pension scheme funding. With The Pensions Regulator’s (TPR) consultation on the new code of practice under way, there is no better time for this debate to rage.
On the Pensions Board we have a rich knowledge base and diverse representation, so are well aware of the range of industry views and research. In preparing a programme of events and responding to consultations we seek to strike a balance between providing a platform to more ‘radical’ positions and representing those who think the current regime (or modest modifications thereof) is pretty well fit for purpose. In our response to TPR’s consultation we will not be arguing for a risk-free/covenant-neutral approach to valuing cash flows for funding purposes along the lines that Chris suggests, but we are certainly well prepared to challenge established norms where we think it will ultimately lead to better outcomes for scheme members and other stakeholders. The strategy team and actuaries at TPR are, of course, well-placed themselves to decide on suitable ways of comparing one scheme with another.
One area that Chris has highlighted where we on the Pensions Board have some alignment is the nature of annual summary funding statements that are issued to defined benefit scheme members. Every time I come to prepare one of these statements, I find myself bemused at the confusing array of information that must be included but is meaningless or may be misleading to members. This is one area where, as an industry, we could certainly up our game.
It’s perhaps a ‘radical’ thought, but how about we tell members what they actually need and want to know?!
Chair of the Pensions Board
19 May 2020
A more inclusive approach
There has been a lot of discussion in the press about the pros and cons of video conferencing.
I live in Gibraltar, so attending actuarial conferences includes travel, whether to the UK or further. We do have an active actuarial society, Actuaries Rock, here, and it is possible to get enough CPD without leaving. It’s also nice to find out about topics relevant to other countries, and also hear about topics that may not be directly relevant to me, but are still interesting.
Since my own lockdown started on 16 March, I’ve attended webinars from Gibraltar, the UK and further away. Looking at my CPD log, up until the lockdown, I got 28 hours of CPD since July 2019. Since the lockdown, I’ve done 27 hours, including my professionalism CPD.
All of this has been via webinars on a variety of platforms. Actuaries Rock hosted a professionalism event on Zoom, and the local Start Up Grind chapter has also moved to Zoom. It’s nice to be able to type in questions, as you can make sure it’s what you really want to ask.
I’ve fed my inner maths geek with webinars on COVID-19 from the IFoA and ASTIN, and on modelling mortality from the IAA. I’ve learned about blockchain, about diversity, and about AI.
It’s been great fun. I do hope this approach carries on, especially for actuaries not based in the UK – it seems a lot more inclusive. Thank you to everyone who’s done these sessions, and keep up the good work.
6 June 2020
In his letter published in your April edition, Jon Spain comments that the literature in the British Actuarial Journal appears one-sided on the topic of financial economics. I would like to point out that the main purpose of the Journal is to record the proceedings of the IFoA’s sessional meetings. It is not biased on any subject. However, it can only record the papers and contributions made, which will reflect the views of the authors, which may or may not reflect the views of the whole membership of the IFoA.
The best way to ensure that all points of view are represented in the Journal is to contribute to the sessional meetings. There are various ways to contribute, including writing a sessional paper, contributing to a working party which is writing a paper, or expressing your views at a sessional meeting. Further information is available on the IFoA website.
Editor, British Actuarial Journal
25 May 2020