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Railpen’s Gray laments DB "destruction"

UK – Malcolm Gray, the recently-retired former finance director of the UK’s 14 billion-pound (20.3 billion-euro) Railways Pension Trustee Co., has expressed his regret about the closure of defined benefit schemes in the UK.

“The current closure of so many defined benefit schemes is dreadfully worrying,” Gray told IPE magazine in an interview. “So much is being destroyed.”

“A new generation of employees will be forced to work into their dotage of retire in poverty. Social historians will look back and wonder how we allowed one Europe’s best-funded pension arrangements to wither.”

Gray – who joined Railpen in 1991 – said he will be helping Railpen until the end of the year and that he would like to put his experience in the industry to good use. His advice to others is to not blindly follow the herd.

“Investment management practice is nowhere near to being an exact science, so always challenge underlying assumptions and fashions and constantly review what you are doing.”

Gray’s successor at the scheme, Frank Johnson, joined Railpen in July and was to take over this month.

Railpen chief executive Chris Hitchen has called Gray “a pioneer in the field of corporate governance”, adding that he developed the concept of pension fund operational risk management.

Railpen's main role is to provide pension and allied benefits for staff in the UK’s rail industry. It has around 30 external asset managers. Railpen runs one of the UK's top 10 pension funds, with 350,000 members.

The latest issue of IPE magazine, with features on the asset management industry in Germany and Austria, alternatives investing and Finland, will be out shortly.

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