Medium sized DB pension scheme
The core focus of the Scheme Actuary is advising trustees on the financing and funding of the pension plan. However, with many plans now closed and entering the final stage, the emphasis may well be on managing legacy liabilities over the medium-long term.
In these circumstances, costs need to be kept under tight control – extra work must be proportional to the value it delivers to any decisions. We aim to agree budgets or provide fixed prices for our valuations. In many cases, we can spread these over the three-year valuation period.
In the majority of our valuations, we recommend using a multi-stage face-to-face approach. We believe this builds confidence and allows for timely decisions to be made throughout the process. It also prevents unnecessary rework and lower costs in the long run, as the Scheme Actuary stays up to date with the trustees’ objectives – and how these can change.
We will develop and refine the funding strategy using real time models to test different scenarios. This means that trustees can optimise their proposals without extensive additional work from the Scheme Actuary – and further delays.
To provide a fully joined up service, we believe that the role of the Scheme Actuary needs to be closely integrated with the Investment Consultant and other advisers. The funding plan and the investment strategy need to be co-aligned with the overall objectives of the trustees and sponsor.