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Soft answers to hard questions: More AVCs? Retiring early? Alison Eadie looks at new guides to the pensions maze

THE DAYS when an employee unquestioningly joined the company pension scheme and had his or her retirement date set in tablets of stone are long over. The increasing complexity of pensions and the array of choices mean companies need ever more information to answer employee queries.

Sedgwick Consulting Group, which provides actuarial and employee benefit services, says it has developed two user-friendly software packages that help personnel managers provide the answers.

AVC2000 deals with queries on additional voluntary contributions. It gives illustrations of estimated scheme benefits at retirement, estimated Inland Revenue maximum benefits at retirement and advice on the maximum allowable AVCs.

PC2000 produces projected benefits from an occupational scheme and a personal pension plan and answers queries on whether or not to contract out of Serps.

With AVC2000 the personnel manager can field a wide range of employee questions: what if I retire early; what if I put in pounds 20 a month extra; what if I stay on for a couple of years' extra service; what do I have to pay if I want a final pension of pounds 20,000 in today's money? Asking an actuary for such information could be expensive.

The computer programme comes up with the required illustrations of benefit and contribution within seconds. It also explains its assumptions about investment returns, inflation, annual gross salary increases, scheme escalation rates.

The basic AVC2000 package sells for pounds 1,750 plus VAT, but can be supplemented by a number of optional extras.

PC2000 helps companies provide a service to staff, who otherwise may only receive advice from financial intermediaries trying to sell personal pension plans. The programme calculates future Serps pensions, rebate-only personal pensions, and company scheme pensions against personal pensions.

It also provides estimates of transfer values out of the final salary scheme over a 10-year period and the alternative personal pension funds that would accrue over the same period. PC2000 costs pounds 475 plus VAT.

The two programmes can be used for money purchase as well as final salary schemes and can be customised to a client's specification. Larger clients tend to require a greater degree of customisation, says Mike Glover, development manager at Sedgwick Consultants.

Client companies range from those with 100 members in their pension fund to others with 100,000 members. And the programmes run on any IBM-compatible personal computer or laptop.