Attacking public sector DB schemes as unfair on the private sector workforce is unjustified, creates a race to the gutter and undermines attempts in the private sector to protect and improve private sector schemes, The Association of Member Nominated Trustees (AMNT) has announced in its inaugural meeting.

The trustees recognised that there are structural problems with DB schemes caused in particular by inappropriate accounting standards and by too frequent and too heavy regulation. It also agreed that UK DC schemes often compare poorly with DB schemes and with some schemes in other countries, notably the Netherlands and Denmark.

Therefore the AMNT is to establish a working group that aims to defend DB with a remit including looking at the feasibility of DB fund mergers, accounting standards, fees and charges, and the opportunities that auto-enrolment might bring.

Janice Turner, MNT of the BECTU DB scheme, commented: “Private sector MNTs find it very offensive that weakening public sector DB schemes is being justified on grounds that they are unfair to private sector workers who don’t have those benefits. Weakening public sector DB schemes only makes it harder for those in the private sector to win badly-needed improvements.”

Turner added: “The trustees also felt strongly that accounting standards are inappropriate and the stream of regulatory changes is costing the DB sector millions in legal advice alone. The DB working group will be coming up with proposals.”

It will also create a DC focused working group, investigating best practice, fee rates, how to improve the design of default funds and to explore the use of collective DC schemes.

The association, run by and for member-nominated trustees, directors and representatives of public and private sector pension schemes, with combined assets of more than £50-billion was set up six months ago. Co-chaired by Janice Turner and Barry Parr, it already has 150 members, 40 of whom attended the first full members’ meeting.

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