A third of schemes are looking to use enhanced transfer values (ETVs) as the stigma attached to them begins to wear off, according to HamishWilson.

The pensions adviser made the prediction following the third and final batch of results from its recent pension fund survey, which received 171 scheme responses.

Twenty-two per cent of schemes expect to carry out an ETV exercise in the next two years, and 12 per cent expect to do so after two years. However, only eight per cent of those participating have done so to date.

"While several employers have carried out ETV exercises, many more have held back," said Hamish Wilson, senior partner at HamishWilson. "However, our survey indicates the number doing so will increase, with one in three schemes expecting to conduct an ETV exercise if they have not done so already. It is clear any stigma attached to ETVs is evaporating.

"The increased interest is likely to reflect falling bond yields which, as the credit crunch recedes, threaten to make pension liabilities an unwelcome item on company balance sheets. ETVs can also be used to manage the end game and reduce costs in the run up to buying out."

Wilson said some smaller schemes that cannot cope with the costs of buyout or buy-ins, and the complexities that options such as longevity swaps bring with them, could see ETVs as their only viable choice.

"But whatever the size of scheme, ETVs, like all other possible courses of action, should be considered as part of a broader strategy. It is also important to get ETV exercises right first time as it may not be possible to have a second bite at the cherry," he said.

The survey aimed to establish the main concerns that trustees and employers have when it comes to existing defined benefit (DB) plans and immediate and longer-term plans for addressing them.

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