Maggie Rodger, Co-Chair of the AMNT said:

“Whilst trustees are very familiar with assessing risk and reward, the rewards that go with risk of the extraction of surplus should not solely be for the sponsor, or even to support the UK economy, but must include benefits for the members.

“It is good that these surplus extraction decisions should be made jointly between trustees and sponsors but the proposals do not address the situation where there is no agreement. For example, where trustees feel that surplus could be used to give discretionary inflation increases to beneficiaries, but this is blocked by sponsors. How can these deadlock situations be managed?

“It must not be forgotten that surpluses have been built up not only because of employer contributions but also because in most cases members paid increased contribution rates and received lower accrual rates as a way to fund the now disappeared deficits. It is therefore appropriate and fair to find ways for them to share in the surplus”, she said.

“Additionally, we welcome the consideration of a government consolidator for small underfunded schemes to provide protection to those members - and glad that this will remain under discussion, even though not in the forthcoming Pensions Bill”, she concluded.