Personally developed solutions to achieve your objectives
Companies generally have some control over factors that impact the business, but this is not the case with DB pension liabilities. Atkin Pensions can help companies regain control.
By understanding your corporate objective and KPIs we will develop solutions to achieve the objective be it short term cost management or long term liability removal. This would include:
• A proactive and robust approach to scheme funding
• A liability reduction/member option program
• An integrated funding and investment flight path to eventual buyout
• Regular updates on KPIs – accounting deficit, P&L charge, PPF levy, cash requirements
Our view is that every DB pension scheme should have an Endgame in place. Your Endgame will be unique to you. By understanding your commercial objectives, Atkin Pensions are able to design, implement and manage a detailed and affordable Endgame that is commensurate with your business plans.
Pensions in Financial Disclosures: The defined benefit pension scheme is now a key part of your financial statements be it the impact on your balance sheet, reserves or profits… Read more >
Controlling costs: When it comes to funding defined benefit pension schemes, there is no such thing as the “right answer”… Read more >
Managing Liabilities: Traditionally sponsors and trustees have concentrated on de-risking the scheme investments and given little thought to the bigger problem of the liabilities… Read more >
Endgame Planning: Endgame is reaching a point at where the provision of full benefits to the members of a defined benefit is no longer at the risk of the employer’s continued support… Read more >
Employer led case study
Trustees presented the company with a preliminary valuation report showing the deficit had trebled to over £4.0m principally because the trustees viewed the covenant as “tending to weak” and requested a doubling in deficit reduction contributions to £500k per annum.
What Atkin did
The company sought independent advice from Atkin. Atkin’s first role was to understand the short and long term objectives with regards to the pension scheme and the current financial position of the company, specifically what it could reasonably afford to contribute, and security that could be provided along with the current dividend policy. Having helped the company define its objectives for the pension scheme, Atkin drafted a response to the trustees challenging their assessment as “tending to weak” and why this had changed from strong 3 years ago when the company’s view was the business was in a better financial position today together with setting out what was reasonably affordable as a contribution. The company was dealing with the financial constraints of lockdown and proposed a minimal level of contributions for 12 months followed by increases up to the current level, with a 6 monthly review based on financial performance.
Following discussions with the Trustees and their adviser, led by Atkin, the Trustees agreed to the company proposal but with a request for 3 monthly financial updates from the company.