British Steel Pension Plan Gets Its First Independent Chairman

Keith Greenfield

The retirement fund for Tata Steel’s UK employees just got its first outsider chairman.

Keith Greenfield will oversee the workings of the British Steel Pension Scheme ($14.6 billion), effective April 1. He succeeds Allan Johnston, who was a trustee since 1994, and chairman of the board since 2007. Johnston will still be a board trustee.

An investment firm, Greybull Capital, bought what’s now British Steel in 2016 from India’s Tata Steel, which had run into financial trouble. But the pension fund remained under Tata’s control. Last year, regulators approved creation of a new British Steel pension program, helped by a cash infusion from Tata.

Johnston successfully negotiated the establishment of the new pension fund with The Pensions Regulator (TPR), which oversees retirement plans, and the Pension Protection Fund (PPF), which covers retirees whose employer pension plans have gone bust. He agreed to structure the steel fund to avoid dumping a majority of its members into the protection fund.

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“Allan has made a significant contribution over the period of his Chairmanship,” said Greenfield, who came to the steel board last year, after the overhaul’s implementation. “Allan’s foresight and leadership over the last 12 years were critical factors in being able to offer members the opportunity of switching to the new Scheme as an alternative to entry into the Pension Protection Fund.”

Greenfield was a former finance director for Royal Sun Alliance’s life insurance business. He has also chaired the boards of the Royal Insurance Group Pension Scheme and Pilkington Superannuation Scheme.

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Tags: British Steel Pension Scheme, Keith Greenfield, Pension, Tata Steel, UK

Two of Australia’s largest pension funds are looking to merge, pooling their assets to form a A$110 billion ($78 billion) retirement kitty.

First State Super and VicSuper Pty made their consolidation talks public Thursday as they begin to “explore the benefits” of the move, which would make them the continent’s second-largest non-profit superannuation fund.

“We have a lot in common,” VicSuper said in a statement. “We’re both profit to member funds, put our members first and believe in the importance of financial advice to help our members make the most of their retirement savings, while also sharing members from similar industries.”

Both funds invest the retirement assets of teachers, nurses, and community-service workers in Victoria and New South Wales.

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This builds on the consolidation trend in Australia’s pension industry. Underperforming funds are under more intense scrutiny by the nation’s government, leading to new laws that call on boards to consider the best interests of plan members. One option is for some organizations to cut their losses and build a bigger, and presumably better, institution. These moves are also cost-effective for the asset owners.

Last month, Sunsuper and AustSafe Super completed a merger that not only turned the new fund into a A$64 billion juggernaut but will also save about A$10 million annually for its members.

“The opportunity to achieve greater scale through a merger like this could help us create even better member outcomes through enhanced services and broader investment opportunities delivering sustainable investment returns,” said VicSuper, adding that nothing has changed and neither fund has yet made a decision considering there is “no obligation to proceed.”

Deanne Stewart, the First State Super’s chief executive officer, could not be reached for comment

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Tags: Australia, First State Super, Merger, Pension, Superannuation Funds, VicSuper