Pension Funding

In recent years, the conversation on pension scheme funding has seen unprecedented change. Many schemes have seen improvements in their funding position that have surpassed all previous expectations. While addressing funding deficits and managing cash, risk and regulatory challenges with traditional and innovative solutions remains a priority for some schemes, surplus considerations are now at the fore for the majority. With changes to the funding regime, significant improvements in funding positions, heightened appreciation of risks and the increasing maturity of many schemes – the valuation is the natural opportunity for the strategic and integrated considerations about the ultimate journey for successfully delivering scheme benefits (sometimes referred to as the ‘endgame’).

Against this backdrop, a co-operative approach to funding between trustees and companies has become increasingly important. WTW works in conjunction with both trustees and companies to help foster a positive, collaborative and constructive engagement that drives towards successful outcomes for all parties.

Trustees and sponsors share the ultimate goal of delivering benefits to scheme members and each party have a commitment to maintaining the financial health of the scheme, ensuring effective risk management and regulatory compliance along the way. However, at the same time, it is recognised trustees and sponsors can have different priorities and objectives on the pace of funding, de-risking timescales, cash, contingency plans and the use of any surplus, which therefore does require separate advice to help reach an optimal outcome.

WTW is the established market leader in pension funding solutions, with access to the most authoritative database for valuation benchmarking in the UK pensions market. We are market leaders in the valuation of pension liabilities, building on deep expertise in all aspects of assumption setting. In addition, WTW’s Asset Liability Suite is industry-leading, providing real time information on the financial position of your pension scheme.

WTW helps clients with the following areas:

• Advice on an extensive range of issues relating to DB pension scheme funding valuations
• Develop integrated funding solutions balancing financial health, risk appetite and long-term objectives
• Strategic partner with trustees and companies to agree endgame strategies
• Advice on Integrated Risk Management, helping clients to identify, assess, and mitigate risks in a way that supports sustainable pension funding
• Guide trustees and sponsors through the negotiation process supported by data-driven insights that facilitate effective and collaborative discussions
• Asset liability tracking including monitoring of dynamic funding and investment strategies.