Pensions are expensive. If you take on staff as part of an outsourcing arrangement, from either the private or public sector, you may be responsible for some or all of employees’ historic pension promises. As a result, unexpected costs from these benefits could exceed any other margins in the contract price. It is therefore vital to make sufficient allowance for them in a contract tender to avoid exposing your business to substantial financial risks. We can help forecast and manage these costs by providing advice on:
Even if you are only providing defined contribution pensions (which don’t usually create significant risks for the employer), there may be potential complications around redundancy costs (for example Beckmann costs for staff transferred under Transfer of Undertakings [Protection of Employment] - TUPE).
Outsourcing arrangements in connection with the LGPS are shaped to a large extent by the fund actuary. However, there can be significant value in taking separate actuarial advice. In particular, Barnett Waddingham’s commercial focus can help to improve the financial outcomes for contractors in many circumstances.
Some specific areas of advice that we provide to contractors in relation to the LGPS Admitted Body framework include:
Below are three bite-sized talks about the New Fair Deal guidance, which protects public sector employees’ pensions rights when their employment transfers to a new company.
This new guidance is intended to make it much easier for companies to outsource work from the public sector, reducing the financial impact of providing public sector-like pensions to employees who transfer.
This is really good news for all parties involved in outsourcing, but there are a number of things to watch out for when bidding for these contracts.
The assumptions that need to be made as part of the LGPS valuation process are varied and many. For example, what investment returns will the Fund achieve in future? What are members going to be earning? How long will they live?
BWebstream is our secure, easy to use, fully-integrated online platform for pension schemes, giving exceptional control over administration. Lisa Hodge from the Public Sector Consulting team tells us how the team has been using the tool.
2018 has been as eventful as ever in the LGPS. In the countdown to Christmas, Associate Melanie Durrant reflects back on the last 12 months, starting from A to Z.
A look at the cost management process for the LGPS and how this might affect administering authorities, employers and members.
The new LGPS (Amendment) Regulations 2018 finally emerged on 19 April 2018, and came into force on 14 May 2018. We discuss the arising issues that administering authorities should consider with regard to exit credits.
Our latest note outlines some of the considerations that should be taken if a new employer becomes an admission body within an LGPS Fund under a pass-through arrangement. Read the note to find out more.
This case study highlights a number of issues for employers who are Admission Bodies in the LGPS, including managing deficit predictions and understanding how assets within the pension fund are allocated.
Our client was a public sector body with its own LGPS fund, who required us to negotiate better contract terms for the bidders. It demonstrates the benefit of the commercial focus we can bring to the public sector arena.
A raffle held at the Barnett Waddingham staff Christmas party has helped to raise additional financial support for Crisis at Christmas – the charity that aims to end homelessness and help change people’s lives for the better.