Deals and People October 27, 2005

CalPERS CIO to Take Top Spot at UK Money Manager

October 27, 2005 (PLANSPONSOR.com) - The chief investment officer of the nation's largest public pension fund has stepped down to take a new post as head of a London-based institutional fund manager.
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The California Public Employees’ Retirement System (CalPERS) and Hermes announced that Mark J.P. Anson was set to leave the $196-billion CalPERS to become chief executive officer of Hermes. Anson is expected to formally take the new post early next year,succeeding Tony Watson at Hermes.

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A CalPERS news release said that the fund under Anson became the first public pension program to pursue environmental investment initiatives aimed at achieving positive financial returns while fostering sustainable growth and sound environmental practices. Under Anson, CalPERS’ investment and corporate governance agendas helped shape market reform initiatives to tackle egregious executive compensation programs, enhance transparency of corporate environmental liabilities, and strengthen hedge fund regulations, the announcement said.

Anson joined CalPERS in October 1999 as Senior Principal Investment Officer for the System’s domestic equity program. He was promoted nine months later to the position of Senior Investment Officer for Equities. He was named CalPERS Chief Investment Officer in December 2001 (See Mark Anson to Fill CIO Slot at CalPERS ).

The fund’s announcement Thursday said its Board will meet to discuss steps to replace Anson in November. The fund’s Chief Investment Officer oversees a 200-member investment staff and implements investment strategies for overall asset allocation, public and private equity, fixed income and real estate investments.

Anson’s new employers were effusive about him Thursday. “He has the ability to think strategically; he has built a team at CalPERS which has delivered outstanding investment performance; and he has driven the organization forward into new asset classes and he has built up a significant number of 3rd party mandates,” said Richard Bernays, Chairman of Hermes, in a statement.

align=”left”>Hermes is a pension fund investment manager, independent of any broader financial services organization. Hermes currently invests over £58bn (as at 09/30/05) on behalf of over 220 clients including pension funds, insurance companies, government entities and financial institutions, as well as charities and endowments. However, Hermes’ largest client is the BT Pension Scheme (BTPS).

More information on Hermes is here .

Compliance October 26, 2005

Boehner Committee Approves PBGC Funding Measure

October 26, 2005 (PLANSPONSOR.com) - A measure approved Wednesday by a US House committee would bump up pension insurance costs by $11 per person next year in a separate move from ongoing pension reform efforts.
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Under the bill approved by the House Education and Workforce Committee, the yearly charge for having private-sector pensions insured   by the Pension Benefit Guaranty Corporation (PBGC) would go from the current $19 to $30 in 2006, according to an Associated Press report. After that, the bill gives the agency the right to seek annual premium increases of up to 20% for the next four years. Congress, however, could disapprove any increase.

The proposed increase would pump $6.2 billion over the next five years into the agency’s coffers; it currently labors under a $23 billion shortfall.

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The committee approved the measure as part of package for cutting federal budget deficits by $35 billion over the next five years. It also would charge companies that have gone through bankruptcy and terminated their pension plans $3,750 for each participant in the plan.

The Senate Health, Education, Labor and Pensions Committee passed its own version of the plan last week that would raise the PBGC premium to $46.75. The Senate version, however, does not include the option to enact future premium increases of up to 20% annually.

Both the House and Senate also are working on comprehensive pension reform bills that, in addition to raising the premium, would tighten funding rules to guarantee that employees get benefits promised them when they retire. Both of those bills also include a premium boost to $30.

US Representative John Boehner,(R-Ohio), chairman of the House Education and Workforce Committee said that while his amendment will provide the PBGC with short-term help, any “comprehensive reform” passed this year will take precedence over this measure.

“The health of our nation’s worker pension system is a bottom line concern for American   taxpayers,” Boehner said in a statement. “While today’s vote to   strengthen PBGC funding is an important reflection of that fact, it is far more critical that we enact a comprehensive measure to overhaul our antiquated pension laws on behalf of workers, retirees, and taxpayers.”

Representative George Miller (D-California), the House panel’s senior Democrat, said he reluctantly supported the proposal but added that the “increases will serve no purpose” without it.

  

More information about the pension reform debate held by Boehner’s committee is  here .

More information about the Bush Administration’s pension proposal is here .

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