Is a rare bird surplus to requirements?
12th July, 2013
There had been only eight recorded sightings of the white-throated needletail in the UK since 1846. So when one popped up again on British shores this week, twitchers were understandably excited.
I am not sure if readers will have picked up on this local “interest” story or read of the rather unfortunate end for our very rare visitor? (more on that later) However, quite curiously this story had me thinking of similarity to this rare needletail and another fabled creature that stalks the pension world, “the Surplus”.
Having started my career in the late 90’s I had never seen this mythical beast with my own eyes. I had heard countless tales of the Surplus banded around by my colleagues whilst trying to tackle “the Deficit”. The Deficit is a parasitic and a very common beast, it latches on to a host and unless treated will eventually suck the host and surrounding entities dry. The Deficit eats investment grade assets like skittles, and takes years to remove assuming the host is not killed by the stress of it all.
You can imagine my shock when having successfully detached a Deficit, a host I deal with was edging to “buy out” (likened to Mount Olympus or the Eden of a Deficit world) and on its shoulder was perched a fine specimen of a Surplus. As beautiful a sight as this was, it brought the question of, what happens now! This is where the similarities take shape.
Having dusted off the Surplus spell book, I found that in order to move it off the hosts shoulder you have to virtually destroy it. In our local interest story twitchers watched in horror as the noble white-throated needletail crashed into a turbine and was killed instantly. This is a very similar end which appears to be befalling my Surplus, having calculated the taxation and associated communication/administration costs my Surplus is on life support and may not travel to buy out with its host.
All mythical references a side, explaining to an Employer who has poured millions into a Scheme to ensure the security of its pension arrangement that getting the extra money back is not a straight forward exercise is difficult. Where buyout has been reached, and all funds are secured, indemnities paid for and in place, surely it would be fitting to allow the majestic Surplus to meet a dignified end and not fall by the wayside and it too killed by fees, taxes and a variety of other pension parasites.