Small details – Big concern

One of the more outspoken debates on Pensionweb has been with regard to the Pension Regulator recommending 100% accuracy in data for everything post June 2010.

As one of the pension managers says, with their regular interaction with HR, payroll, different company divisions etc, it will never be possible have 100% accuracy on common data such as addresses.  One of the other Pensionweb correspondents suggested that a way out may be to put the company office address where one is missing. And another suggested simply accepting it will never be 100% as constantly chasing deferred pensioners for new addresses is not worth the administrative expense.

The section in the ‘record keeping’ section on the Regulator’s site says this:

“14. The targets for the standard of common data we recommend is achieved by December 2012 are:

• For new data created after June 2010 – 100%
• For legacy data (created before June 2010) – 95%; this lower level is in recognition that many schemes will have greater difficulties with older data and may inherit problems from previous trustees, managers or administrators.”

An unreasonable target? Definitely. For any largish scheme, data changes every day. Yes, I guess you could cheat the system by putting in a temporary address, but better the Regulator understood the issue and stated up front that he was aware that the 100% would not be achieved. Better still, give a few percent leeway, as he has done with legacy data.

A small point. But not a small issue. If the Regulator wants to work with the industry, he needs to be careful how he speaks.

The Value We Place On The Old

Former head of the Benefits Agency, Lord Bichard, has suggested that retired people should be encouraged to do community work such as caring for the ‘very old’ or face losing some of their pension. He went on to suggest older people were a ‘negative burden on the State’. (See main article: BBC News).

Slightly to the right of Genghis Kahn, Lord Bichard’s remarks are ill thought through. Many older people already work voluntarily. A lot of charities depend on them. To suggest that benefits should be lost for those that are not working in retirement seems to miss the fact that individuals have worked a lifetime for their pension and paid taxes for their benefits.

To suggest that older people are a ‘negative burden’ is ageist and extreme. I’m sure there are some who may not deserve the State benefits they enjoy but to target those in retirement is perverse and unworthy of a country that owes so much to the generations that have gone before us.

Bigger, Bulkier…. And less in it? The New Look Professional Pensions

Professional Pensions magazine has undergone a design change. Less a newspaper, more a magazine now I’d say. A bold front cover in a magazine style. A couple of pages of weekly news in a format that looks to have been borrowed from Pensions Insight. And a ‘numbers’ feature that leans heavily on a Times idea.

My distress at the new design is not how it looks but what is in it. Page after page of lengthy articles. Much of it ‘old news’. When will we all have time to read this stuff? That’s assuming Professional Pensions stays as a weekly. It looks more like a monthly now.

But don’t fear, help is at hand… (dramatic music helpful at this point)…. Grumpy Old Pension Men has gone on to YouTube. Everyone can access it. Everyone can comment on it. A short five to eight minute weekly TV digest of pensions news, provided in a slightly provocative manner with a good dose of grumpiness.

 

Go on, you know you want to….. LINK TO GOPM

When the 'P' in Pensions stands for 'Politics'

David Cameron is falling into the same trap as Gordon Brown. He’s worried about votes and is threatening to change pensions because of it.

The laudable ideas from Cameron’s work and pensions secretary Iain Duncan Smith and his able pensions man Steve Webb are in danger of coming to nothing, having travelled so far.

It’s not the first time pensions has become political- Gordon Brown was renowned for this- but at this stage in a new process, it is particularly disappointing. The idea of a flat rate State pension looks like it may be kicked into the long grass and not considered further before the next election.

I suspect that the real motivator here is George Osborne, the Chancellor, and he is ‘using’ the Prime Minister to push home his points. I know the newspaper reports say otherwise, but the reform can be shown to be costly financially and not just costly in terms of the voters who may lose out. Why is Cameron bowing to the views of his Chancellor? Maybe it is the votes. More likely it’s the cost of the changes that the Opposition can latch on to before the election- so votes again, albeit one step removed.

Shame on you Mr Cameron. You could have saved the future of pensions in the UK, simplified the system and added a long term confidence in the system that is currently lacking. Instead, you have bowed to the ballot box.

NAPF Value?

There’s a lot of discussion on Pensionweb right now about the latest proposals from the National Association of Pension Funds to put up their subscription charges.

It raises the same old questions- if we pay, what do we get? Questionable lobbying? Possibly a listening ear? Maybe some good training that may be free elsewhere?

The NAPF has a problem and always will have. It purports to be a spokesperson for the pension scheme- but it is largely sponsored by consultants and investment managers. Its council in years gone by has been flooded with providers, lawyers and actuaries. How can it speak for the pension scheme with such strong external influences?

It gets by- or at least it has until now. If the subscription charge goes up, the very members it says it represents will be the first to leave. Most sponsoring businesses are going through the recession with reduced workforces and cutbacks. The NAPF? No sign of any cut backs that I can see. And not clever to talk of increased subscriptions when times are hard.

It wouldn’t be so bad if they really did speak for the industry, but when there is a need for a spokesperson on TV, the news channels usually turn to Ros Altmann of Saga for the provocative sound bite.

When they do get it right, when they do get on TV as spokespeople, it’s good news. It just doesn’t happen enough. Not enough for a subscription rise anyway.

Stating the Obvious

Sometimes the headlines on pensions and finance require an appropriate amount of humour. For example, the headline in this week’s Guardian that announced a 10 year low in dealings on the Stock Exchange. When was this measured? Last week. The final few days of the Olympics on home territory.  Come on guys!

Or the recent headline in Professional Pensions magazine telling us that employers expect to see an ageing workforce.  Yes…. Tomorrow they will be older than today.

The most obvious pension headlines though relate to communications. Journalist after journalist expresses surprise that the general public know little or nothing on the subject. When we have to struggle with the quantity of pension jargon proposed by the DWP in their glossary of auto-enrolment terms, it's no surprise.

Oh Mr Miliband, You've Opened Your Mouth Again....

The Labour Party are finding a bit of leverage in the polls. But then seem to struggle the moment their leader opens his mouth…

Ed Miliband has been at it again- talking first, thinking later. The problem is he’s been talking about pensions this time. He may think he’s helping by criticising high administration charges, but sadly, when notable politicians criticise the pensions industry, the general public respond- by avoiding that industry!

People who may have invested in pension plans may not do so now because a senior politician has questioned an industry practice. Miliband may be partly correct- there are some high charges still, but generally charges are coming down. And just when we wanted some confidence in the industry with Auto-Enrolment rapidly approaching, Ed’s gone and put his foot in it- or should I say his mouth in it.