Irish consultants are still witnessing heavy demand from pensions clients for services and advice on the strategies to deal with the many changes still rolling on in the sector.
Clients across the board are continuing to move towards defined contribution pension schemes, consultants say, and now some of the more established defined benefit schemes are closing off schemes on this traditional basis for new employees.
Changes in legislation afoot in Ireland should allow greater flexibility in the way pension assets are used, with the introduction of an option at retirement to keep funds invested. At the moment, this option is only open to directors of companies and the self-employed, but in future it is expected to be available to employees as well.
"A lot of the institutions are gearing up to be able to deal with that," says Tom Lyne, director of PAS Consulting in Dublin. The new rules on personal retirement savings accounts, which are expected later this year, should not be dissimilar to 401k plans in the US, says Alan Broxson, director of Irish Pensions Trust.
Pensions consultants are finding the investment side of their business increasingly important, says Lyne. In line with the global trend, pension funds have been moving towards more specialised investment advice, says Shane Wall, actuary at Coyle Hamilton. And the scope of expertise provided by consultants has in many cases broadened to tax issues, he says.
Regulation has become higher profile for the consultancy industry, with the Irish central bank now taking more of a hands-on role in policing the activities of investment intermediaries.
The merger between Mercer and Irish Pensions Trust has radically changed the shape of the industry in Ireland, consultants say. Some estimate the new partnership now controls between 60 and 70% of the market.
Empire building has been going on elsewhere too, with major player Aon buying up some of the smaller consultancy firms over the past few years, says Lyne. But the smaller advisers remain, with insurance brokers continuing to transact pensions business for smaller funds.
Overall, there has been a marked increase in workloads for consultancies. This is partly due to the new issues in the pensions industry which funds have needed to cope with, but also simply because the pensions market is spread more broadly, consultants say.
"Things are hectic here anyway with the new companies which were set up in the last year," says Broxson. Rachel Fixsen