UK - The UK's defined benefit (DB) pension schemes could save £100m (€123.5m) a year if the European Court of Justice (ECJ) decides they should be exempt from VAT - currently levied at 20% - on investment management fees, in a case which the ECJ has just started to examine.

The case has been brought by the National Association of Pension Funds (NAPF) and Wheels Common Investment Fund, which includes the UK company schemes for Ford.

A tribunal hearing in London in February last year decided to refer the case to the ECJ.

However, the legal action had started in 2008 after an ECJ ruling in favour of JP Morgan Fleming Claverhouse Investment Trust and the Association of Investment Trust Companies, which said investment trusts were special investment funds and should be exempt from paying VAT on investment management services.

The ECJ started hearing the case last week.

Joanne Segars, chief executive at the NAPF, said: "We feel we have a strong case. A ruling in our favour would benefit the members of the pension schemes by cutting running costs and increasing the funds available for investment."

In other news, Mercer has warned UK trustees against assuming that the Office for National Statistics' recently issued mortality rates will "materially impact" the rate at which life expectancy is increasing.

The ONS contends that mortality rates have been falling more slowly than expected.

Andrew Ward, head of longevity swap consulting, said: "No one can say for sure how mortality rates will develop in the future, and there is evidence that could arguably be used to support a number of different views.

"If anything, this recent data just serves to underline the inherent difficulty in predicting life expectancy."

Lastly, two out of five British adults do not know where their pension is invested, according to research by Baring Asset Management.

The survey found that 41% of respondents could not remember how their retirement funds were invested when they last reviewed their pension plans.

Barings said the research showed that, in spite of the ongoing global financial crisis, people were refusing to consider the impact it might be having on their long-term savings.

Furthermore, 45% of those surveyed admitted they had never reviewed their pension plans.

And a further 12% could not recall when they last reviewed their pension.

Of those non-retired adults who did recall having reviewed their pension plans, less than half (48%) had done so over the last 12 months.

Comparisons with the results of the same survey conducted in July 2008, before the onset of the financial crisis, show that this apathy has not improved in recent years.

However, the survey also revealed a slight increase in the percentage of non-retired British adults with a pension (23%) who chose the fund allocations themselves, up from 20% last year.

This is the highest percentage recorded since the question was first asked in 2008, when 19% chose the allocations themselves.

And more than one-third (35%) had selected the default investment option for their retirement funds, down from 40% four years ago.

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