FRIDAY, JUNE 10, 1988
"BY DISCLOSING THE DETAILS OF THE SCHEME, BENEFICIARIES COULD PLAY A MORE ACTIVE PART IN LOOKING AFTER THEIR INTERESTS AND REPORT ANY MALPRACTICE OR MISCONDUCT TO THE AUTHORITY, ++ MR NENDICK SAID.
"TRUSTEES OF SCHEMES MUST ALSO ENSURE THAT THE ACCOUNTS ARE AUDITEDANNUALLYAND THATACTUARIAL REVIEWS ARE CONDUCTED BY ACTUARIES EVERY THREE YEARS, OR AFTER ANY MATERIAL CHANGES то THE ACTUARIAL
ASSUMPTIONS.
ENSURE
THAT
"THE ULTIMATE AIM OF PRUDENTIAL REGULATION IS TO THE BENEFITS CAN BE DELIVERED TO SCHEME MEMBERS UPON RETIREMENT. APART FROM ANNUAL AUDITS AND REVIEW, A VERY FUNDAMENTAL ELEMENT IS THE PROVISION OF ADEQUATE FUNDS.
"FOR DEFINED CONTRIBUTION SCHEMES, THE FORMULA IS SIMPLE EMPLOYERS AND EMPLOYEES SIMPLY HAVE ΤΟ MAKE THEIR PREDETERMINED CONTRIBUTIONS. FOR DEFINED BENEFIT SCHEMES, THE FUNDS EMPLOYERS HAVE TO SET ASIDE WILL BE DETERMINED BY THE ACTUARIES, MR NENDICK CONTINUED.
"THE PROPOSED SYSTEM ALSO MAKES PROVISIONS FOR THE TERMINATION OF RETIREMENT SCHEMES.
"UPON TERMINATION, ANY BENEFITS DUE ΤΟ BENEFICIARIES NOT COVERED BY SCHEME ASSETS WOULD FALL ON THE EMPLOYER AS A CIVIL DEBT. WE PROPOSE THAT THE BENEFICIARIES AS CREDITORS WOULD TAKE PRIORITY OVER OTHER CREDITORS IN A RECEIVERSHIP OR LIQUIDATION, THEIR CLAIMS RANKING IMMEDIATELY AFTER SUCH OTHER PREFERENTIAL CLAIMS AS WAGES SEVERANCE PAY," HE SAID,
AND
ON THE IMPLEMENTATION SIDE, MR NENDICK SAID: "NEW LEGISLATION WOULD HAVE TO BE ENACTED AND EXISTING ONES AMENDED BEFORE THE PROPOSED SYSTEM COULD BE PUT IN PLACE. WE ARE PROPOSING THAT WITHIN TWO YEARS OF THE ENACTMENT OF LEGISLATION, ALL RETIREMENT SCHEMES SHOULD BK REGISTERED AND WITHIN THREE YEARS OF REGISTRATION, ALL UNFUNDED VESTED LIABILITIES MUST BE FUNDED. THERE WOULD THUS BE A TRANSITIONAL PERIOD OF UP TO FIVE YEARS.
"ALL UNFUNDED ACCRUED LIABILITIES MUST BE FUNDED OVER A PERIOD DECIDED BY THE EMPLOYER, WITH THE AGREEMENT OF THE TRUSTEES, HE ADDED.
MR NENDICK SAID THAT THE PUBLIC WERE INVITED TO COMMENT ON ALL ASPECTS OF THE PROPOSED SYSTEM OF REGULATION.
"THE PUBLIC CAN OBTAIN A COPY OF THE CONSULTATIVE DOCUMENT FROM THE MONETARY AFFAIRS BRANCH OR, FROM JUNE 17 ONWARDS, THE DISTRICT OFFICES. EMPLOYERS WHOSE SCHEMES ARE APPROVED BY THE COMMISSIONER OF INLAND REVENUE WILL ALSO RECEIVE A COPY OF THE DOCUMENT. IN ADDITION, COMMENTS WILL BE INVITED FROM PROFESSIONAL BODIES INVOLVED IN THE MANAGEMENT OF RETIREMENT SCHEMES.
"THERE IS A THREE-MONTH CONSULTATION PERIOD SHOULD BE ADDRESSED TO THE MONETARY AFFAIRS BRANCH 1988, MR NENDICK SAID,
BY
AND COMMENTS SEPTEMBER 15,
17