UK’s opposition slams consultants, actuaries

UK – The UK’s main opposition party has attacked pension consultants and actuaries for the current dire state of the pensions industry.

Howard Flight, treasury spokesman for the Conservative Party, said: “Companies and pension trustees rely predominantly on the advice of their actuaries and pension consultants. What were they saying in the second half of the 1990s?”

Flight said the advisors should have been calling for the suspension of over-funding rules or applying a discount to stock market portfolio values reflecting the market bubble at the time.

“They should then have been advising their pension fund clients to reduce their equity and increase their bond exposure,” Flight writes in a letter to the Financial Times.

Flight, who was joint chairman of Investec Asset Management, said actuaries provided the “professional justifications” for contribution holidays “without warning of the risks”.

He criticised consultants and actuaries for not changing asset allocation advice in response to the low-inflation environment of the 1990s.

Flight’s broadside is the latest attack on advisors. Ten days ago PricewaterhouseCoopers partner John Shuttleworth blamed just about everybody involved in the UK pensions industry for its plight in a newspaper article.

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