BA Pensions has selected Redington to become the strategic investment consultant for its £6bn Airways Pension Scheme (APS).
Redington will collaborate with outsourced chief investment officer (OCIO) BlackRock to “continually ensure the OCIO relationship is delivering maximum value for APS and its members”, it was announced.
Chief executive officer of BA Pensions, Vinny Ehzuvan, stated: “We are committed to having investment strategies that maximise financial security for members’ benefits whilst stabilising the funding position of each scheme.”
Ehzuvan also claimed that “Redington’s values and priorities [are] aligned with our own”, and that Redington’s “deep knowledge” of the struggles defined benefit schemes face “will enable them to continue delivering the best possible investment outcomes for APS members”.
Nick Lewis, Redington’s managing director and head of OCIO advisory, added that “APS is in a strong position” thanks to the trustees calculated efforts to gradually de-risk the scheme.
The partnership, in which Reddington will be able to support APS’ 20,000 members, will assist Redington’s aim to help make 100 million people financially secure.
Risk of new generation of gender inequality, says LCP
Recent analysis on the gender pension gap conducted by consultancy LCP shows that the success in reducing gender gaps in state pensions could be undermined in future if inequalities between men and women in workplace defined contribution (DC) pensions continue to rise.
Earlier this year the Department for Work and Pensions (DWP) published new figures on the private pension gender gap and projections show that the gap will have a major decrease.
However, this is solely because men’s pensions are on track for a dramatic decline. In the past, private sector defined benefit (DB) pensions have been received almost exclusively by better paid men, but the increasing rarity of these schemes means in the coming future men’s incomes will reduce sharply.
At the same time, a worrying new gender pay gap is emerging in the DC space; every inequality seen between men and women is now being replicated in DC pension outcomes, and despite improvements for women (for example in the labour force), these changes can take decades to take effect when those people retire, LCP claimed.
LCP’s report – The gender pension gap: how did we get here, and where are we going? – details a set of six key themes which are causing the gap:
- the gender pay gap (directly related to unequal pensions);
- the caregiver penalty (greater number of women taking on caregiving responsibilities);
- the longevity penalty (women typically need a larger pension than men);
- relationship breakdown (uneven pension accruals during a relationship are not equalised during divorce);
- impact on rules of enrolment (amongst employees, women are more excluded than men);
- financial confidence (surveys show lower confidence in women when investing).
The report also highlighted recommendations to governments, employers and the pension industry on how to combat them:
- the government must continue to publish gender gap statistics to maintain awareness;
- employers must support workers with responsibilities in later life;
- the pensions industry needs to equip men and women with an understanding of their pensions to make better informed choices.
Laura Myers, LCP partner and one of the report’s authors, said: “Our research suggests that there has been welcome progress in some aspects of the gender pension gap, notably the reduction in inequality in state pensions.
“But there is a real risk of a new generation of pension inequality if action is not taken. In a world of DC pensions in particular, pension outcomes hold up a mirror to inequalities in the workplace and the different labour market experience of men and women.”