UK – The chairman of the UK's Pension Protection Fund has said that she is "trying to help" as best as she can to realise proposals for defined ambition pensions.

Speaking at the National Association of Pension Funds Investment Conference in Edinburgh last week, Lady Barbara Judge noted that new estimates see the PPF's assets increasing from £13bn (€14.9bn) to £22bn by March 2016, although this would probably occur as more insolvent funds completed their ongoing assessment periods, not purely from investment returns.

Lady Judge added that the slow demise of defined benefit (DB) funds in the UK was resulting in members using defined contribution (DC) arrangements, despite being "ill-equipped" to deal with the associated investment risk.

"So we all are applauding [pension minister] Steve Webb's idea of defined ambition," she said.

"We hope there will be an evolution to a middle ground where pension plans will not be subject to traditional DB regulation, but wouldn't pass all the risk to members – so that they would have a much better chance of getting a multiple of what they put in, rather [than] half of what they put in."

Webb's Department for Work & Pensions last year published a paper on how to reinvigorate the occupational pension landscape in the UK, suggesting that the third way pension plan could see the reintroduction of risk-sharing.

He has since repeatedly suggested that one option of reducing risk for DC savers could be to launch a PPF for DC funds, potentially allowing the smoothing of returns.

However, Lady Judge warned that were other "clouds on the horizon" apart from the end of DB provision.

"The first cloud is Solvency II," she told delegates, noting that basing the revised IORP Directive around insurance regulation did not make "any sense at all".

"It will increase costs, it would do little to increase people's security and it would have no increase in what members receive," she added. "If you force people to be fully funded to that extent, they will close DB pension plans even faster than they already have."

Lady Judge's comments echo her previous remarks to IPE that a revision of IORP based around Solvency II would have the unintended consequence of causing an increasing number of defined benefit (DB) funds to "fall over".

She further told the conference that the PPF had worked hard to draw attention to the problem, both by writing opinion pieces in newspapers and engaging with government.

"The government is actually on our side," she noted, "but the EU, as you know, is not run by the UK." She called on attendees to "get behind the idea [that] Solvency II is not for us, not for our industry".

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