The National Association of Pension Funds (NAPF) has repeated its call for the UK government to issue more index-linked Gilts and allow defined benefit (DB) schemes to provide a smoother run-off for members.In a report, ‘DB run off: The demand for inflation-linked assets’, the industry group said UK DB schemes needed higher levels of index-linked issuance to effectively manage risk and the shift to liability-driven investment (LDI) strategies.It said while derivatives, infrastructure and real estate all provided other options for inflation exposure, they were not suitable for all schemes.The paper said, citing data from Towers Watson, that 50% of DB liabilities are hedged currently. However, the NAPF expected demand of additional inflation-linked assets to reach £1trn (€1.2trn).Some 40% of NAPF members said the appetite for index-linked assets was growing.However, increasing demand for index-linked Gilts has pushed up costs for schemes, and lowered real yields.Selected index-linked Gilts, with maturities ranging from eight to 31 years, all provided negative real yields for investors.“Yields on index-linked Gilts have been on a declining trend for the past 20 years, making it more expensive for schemes to purchase them as part of a de-risking strategy,” the NAPF said.“There has been increasing frustration from schemes that, in order to reduce their interest rate and inflation risks, they are effectively ‘forced’ buyers of Gilts with low or negative real yields.”Extra issuance from the government was the only solution to aiding schemes hedge inflation risk in an appropriate manner, it said.Alternative options, such as real estate and infrastructure, are less developed markets and have accessibility issues, with poor liquidity and volatility, making schemes reluctant to invest. However, the Debt Management Office (DMO), the department responsible for the issuance of UK government debt, issued £32.6bn of index-linked Gilts by the first quarter of 2014.Overall, the bonds accounted for 22.9% of the Treasury portfolio, with £326bn issued.Chief executive of the DMO, Robert Stheeman, told IPE that inflation-linked Gilts was a core part of its remit and that, in percentage terms, no other sovereign government issued as much.“This time 10 years ago, we issued less than £10bn in linkers,” he said.“Our supply of inflation-linked Gilts has dramatically increased, as have long-dated ones. We are very happy to issue, as we think it is very good value for money. But we cannot do this exclusively.”The NAPF, alongside its call for greater issuance, said the government and investment industry must also ensure that inflation-linked opportunities outside of Gilts reach their potential.“This will involve packaging these assets in a way that offers an attractive inflation match, improving levels of supply and offering pricing and valuation that is transparent and reliable,” it said.Director of external affairs for the lobby group, Graham Vidler, added: “Unless the supply of assets is addressed, and quickly, the costs of providing member benefits could continue to rise and place even greater pressure on scheme sponsors.“There is no quick-fix solution to the problem.”
Curt Martin won his first Deery Brothers Summer Series feature of the season while ending Justin Kay’s streak at four straight IMCA Late Model tour victories on Memorial Day at Boone Speedway. (Photo by Bruce Badgley, Motorsports Photography)BOONE, Iowa (May 28) – A driver who knows a thing or two about winning streaks ended one and started one of his own Monday night at Boone Speedway.Curt Martin led all but one of 40 laps in winning the Memorial Day Deery Brothers Summer Series event at Boone, earning $2,000 for his career 27th IMCA Late Model tour victory.His convincing run at the front ended Justin Kay’s bid for a record fifth consecutive series victory. Jeremiah Hurst finished a distant second, with Ryan Dolan, Kay and Joe Zrostlik rounding out the top five.Martin drew the pole and gave up the lead early to Hurst for a single circuit before resuming command. Just a couple cautions slowed what was otherwise a fast-paced feature but Martin edged ahead on lap 10 and 22 restarts.Hurst was the $250 Sunoco Race Fuels feature qualifier drawing winner.Martin and Kay are now tied for third on the all-time series wins list; Martin had been the first Deery driver to win three straight features, doing so twice in 1990 when he earned the first of back-to-back tour championships.He’d last won at Boone during the 1999 IMCA Speedway Motors Super Nationals fueled by Casey’s.The fifth stop on the 2018 Deery Series schedule is Tuesday, June 5 at Marshalltown Speedway. The Steve Priske Miller Lite 50 pays $2,000 to win and a minimum of $300 to start.Feature results – 1. Curt Martin, Independence; 2. Jeremiah Hurst, Dubuque; 3. Ryan Dolan, Lisbon; 4. Justin Kay, Wheatland; 5. Joe Zrostlik, Long Grove; 6. Jason Hahne, Webster City; 7. Chad Holladay, Muscatine; 8. Nick Marolf, Moscow; 9. Todd Cooney, Pleasant Hill; 10. John Emerson, Waterloo; 11. Rob Toland, Colona, Ill.; 12. Charlie McKenna, Clear Lake; 13. Kyle Krampe, Baxter; 14. Shawn Cooney, Bondurant; 15. Luke Pestka, Robins; 16. Greg Kastli, Waterloo; 17. Tim Simpson, Iowa City; 18. Cayden Carter, Oskaloosa; 19. Matt Ryan, Davenport; 20. Rob Moss, Iowa City; 21. Andy Nezworski, Buffalo; 22. Darrel DeFrance, Marshalltown; 23. Chad Coyne, Orion, Ill.; 24. Richie Gustin, Marshalltown.
American Red Cross correction