NAPF: UK Government review of Myners taking 'longer than expected'
UK – The UK government says it will be “taking stock” of a series of current issues in the pensions industry in the early spring and summer – but conceded that the quantitative review of the Myners Report was taking longer than expected.
The Treasury’s David Lawton, whose brief covers company law and auditing, said the issues on the Government agenda were the Pensions Bill, the two-year review of the Myners Report and the Financial Services Authority’s decision on soft commissions.
“The government should be looking to take stock of all this in late spring early summer,” Lawton told the National Association of Pension Funds’ annual investment conference in Edinburgh.
The government has contracted an independent research firm, Consensus, to conduct a quantitative study of 1,500 schemes. “This is taking longer than originally expected though the fieldwork is now complete,” Lawton said. The researchers were now collating the data. “I’m very confident that the overall results will be very robust.”
The two-year review of Myners was “not taking two years – though it sometimes seems like it,” Lawton joked.
The findings from the earlier qualitative survey found mixed progress on Myners, Lawton said. Funds had progressed best in terms of asset allocation, benchmarking and performance measurement. There was “more moderate” progress on setting out clear investment objectives and explicit mandates.
There was least progress on decision-making, shareholder activism and transparency to fund members. Only one of the 11 statements of investment principles set out where it complied with Myners, he said. Largest schemes were the best performers.
Lawton said much remained to be done in practical terms, citing clarity of time horizon, the broadening of sources of investment advice, asset allocation and shareholder activism issues.
And he appeared to suggest that smaller pension schemes could be offered a loophole in terms of the ‘comply or explain’ aspect of new legislation. He said funds could reasonably use their lack of resources as a valid reason for lack of compliance.