UK - The Association of Consulting Actuaries (ACA) has called for "better safety valves and flexibility" in the public sector pension scheme.
In a submission made to the review of public sector pensions chaired by Labour's Lord Hutton, the ACA recommended a system of core defined benefit (DB) schemes as a substitute to the current arrangement.
Commenting on the submission, the organisation's chairman Stuart Southall said: "Introducing 'middle way' designs into the public sector now would help stimulate the wider recovery in voluntary 'quality' pension provision that is required across-the board."
The ACA said that while certain approaches that share more risk with scheme members are feasible, it would only recommend them on a progressive level, where "only those who are more financially able to manage the consequences of uncertain outcomes actually share in the risk".
It also said safety valves needed to be in place to better cope with stresses on the system and that the arrangement should be viewed as fair by all taxpayers, regardless of their involvement in the public or private sector.
However, the actuarial group warned that the pension arrangements needed to remain sufficiently attractive to employees, providing an incentive for quality employees to remain a part of the government sector.
In other news, the Barclays UK Retirement Fund (BUKRF) confirmed its deficit increased to more than £4bn (€4.9bn), as the bank announced results for the first half of 2010.
Compared with the end of 2009, when the company reported a shortfall of £3.5bn, the IAS 19 deficit has increased by 12% to £4.028m.
The report, noting the 0.39% drop in rates compared with December 2009, said: "The most significant reason for this change was the decrease in AA long-term corporate bond yields, which resulted in a lower discount rate of 5.22%."
The scheme, which closed to future accrual last year, recently announced the appointment of Stergios Saloustros as head of dynamic asset allocation.
Saloustros had previously worked at F&C Asset Management.
Finally, Pitmans Trustees has warned that many pension schemes have taken a dysfunctional approach to risk management.
Richard Butcher, managing director, said there were two particular problems with the current approach.
"Firstly, as an industry, we have adopted schedules as a way of recording risk and controls, and secondly, the process is perceived as a separate governance process," he said, insisting this hindered the process, thereby creating higher risks.
Butcher said risk management needed to become a more organic process and called on the industry to build a new system.
"The industry as a whole needs to put their heads together and come up with new ideas," he said, adding that the Pensions Regulator could encourage this by altering its own approach.