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The consultation also considers whether the technical actuarial standards (TASs) should include specific principles to be followed when providing actuarial advice on incentive exercises.
The consultation paper has been written for anyone that is likely to be involved in preparing or using actuarial information concerning pension scheme incentive exercises. The intended audience includes actuaries, pension scheme trustees, pension scheme sponsors, regulators and pension scheme members.
This document proposes that actuarial work concerning incentive exercises is brought into the scope of the Pensions TAS. It also proposes new principles to be included in the Pensions TAS, and considers whether further principles might be included at a later stage.
The consultation paper seeks views on these proposals and is one of a number of initiatives which aim to ensure that trustees, sponsors and pension scheme members have the information they need to make decisions in connection with incentive exercises.
In section 2, the Board for Actuarial Standards (BAS) considers the background to this consultation, covering the different types of incentive exercise, public interest concerns and the existing regulatory safeguards. In section 3, BAS sets out proposals to bring actuarial work concerning incentive exercises into the scope of the Pensions TAS.
In section 4 BAS proposes new principles for inclusion in the Pensions TAS which cover the reporting of the changes in risks faced by, and the impact on, pension scheme members who accept incentive offers. Section 5 contains an impact assessment of BAS's proposals, and section 6 invites respondents to comment on the questions in the paper. Appendix A sets out the proposed changes to the text of the Pensions TAS.
Draft revised Pensions Technical Actuarial Standards June 2012