Pensions Convention 2011. Review of Plenary 4: Our professional future - different perspectives

Challenges ahead for pensions actuaries...

In the final plenary session of the Pensions Conference in Southport, a panel posed three questions to the audience with some initial comments and remarks before opening the debate to the floor. 

The panel was made up of three speakers with different perspectives - Claire Rankin, a senior lawyer advising on pensions law, Edd Collins, a new entrant to the Profession and Charles Cowling, an experienced member of the Profession. 

A short summary of each of the three questions and key points of discussion follows:

1.   What is the public interest and what are the Profession’s obligations in this respect?

Public interest is right at the heart of the Profession and is what the public want from us.  It is not always an easy issue to grasp and to really get a sense of what is in the public interest, we should be asking the question "how will our actions stand up to scrutiny, for example, in the pages of our national press?"

Most notably, public interest was thrust upon us through the Equitable Life affair and Morris review.  Other recent examples may include benefit reductions and enhanced transfer exercises. 

It was generally agreed that where we are experts in our areas, we have a responsibility to speak out and the Profession needs to be more proactive going forwards. 

2.   Is pensions regulation a force for good and how will it change in future?

Following a brief recap of the history of pensions regulation and how we came to be in the current environment, the view was put forward that defined benefit schemes are not fit for purpose as we have regulated them.  In this case, it is difficult to see how pensions regulation has been a force for good. 

The Profession is not without blame for the current state of pensions and it should have spoken up at the time.  This is one area where the Profession acknowledges it needs to improve and it has recently adopted a different approach to communicating with the Government.  By gathering data and evidence and presenting these to the Government, it hopes to let the facts speak for themselves.

3.   What are the future career prospects for pensions actuaries?

With defined benefit schemes closing at a rate faster than ever before, the future of pensions actuaries is in doubt.  Some thoughts on what the future might entail included: 

• Settlement of benefits will become an increasing focus of our time.
• We will become overloaded with regulations.
• There will be a trend towards defined contribution benefits.
• There will be a trend of actuaries moving to less traditional areas such as Enterprise Risk Management and Healthcare.
• The actuarial profession will become more akin to the accounting profession with junior members taking the exams and moving on to different areas.

 
There are real challenges ahead for pensions actuaries and we will need to reinvent ourselves by learning new skills and working in different areas.  Notwithstanding this, there are still plenty of great opportunities out there.