Industry ‘disappointed’
Insight Investment’s head of solution design Jos Vermeulen said: “We are disappointed that the government will be allowed to push ahead with their plans for RPI reform.
“Insight and a broad range of market participants highlighted significant concerns about the proposals during the government’s 2020 consultation.
"It was of no surprise that three UK DB pension funds felt they had no choice but to challenge the government’s decision, which will result in a transfer of wealth in the region of £100bn from index-linked gilt holders (largely pension funds) to the government.”
Vermeulen reiterated that the decision would “reduce pension transfer values and lifetime incomes by 10 per cent to 15 per cent or more”.
“With inflation surging, many pensioners are already struggling and RPI reform represents an additional and entirely unnecessary blow,” he noted.
Benjamin Mercer is senior reporter at Pensions Expert, FTAdviser's sister publication
