The Pension Protection Fund's (PPF) new Statement of Investment Principles (SIP) are even less transparent than before, warns Lane Clark & Peacock (LCP).

"A key theme from Lord Myners and others has been to encourage increased transparency in pension scheme investment matters, including strategy," commented Gavin Orpin, head of trustee investment at LCP. "Therefore, it is disappointing that the PPF seems to be moving in the opposite direction, particularly since every final salary beneficiary has an interest in the PPF."

The PPF's strategic asset allocation, which is now split into just three categories (cash and bonds, public equity and alternatives), has been reduced from six. The PPF, LCP said, appears to be increasing its credit exposure through global aggregate bonds, although there has been no indication of how much. Further details, the UK actuary said, would be helpful.

The benchmark outperformance target has increased from 1.4 per cent to 1.8 per cent, which LCP says reflects diversification of return-seeking assets, but asks how much now depends on the expected returns from active manager skill and credit markets.

And finally, the PPF's benchmarks for global bonds and global equities were previously hedged to sterling, which is no longer the case. LCP questions to what extent the PPF is now exposed to sterling volatility.

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