"Will no one rid me of these turbulent Member Trustees!"

I've been sent a rather odd and disturbing link to a story here on "Engaged Investor" magazine's website.

In which a pension consultant is quoted as saying he understands that the Government is maybe thinking of getting rid of Member Nominated trustees who sit on Pension scheme Boards???

So who will replace the  representatives of those who actually pay into the pension scheme and act as the owners of their capital? Let me think now? - perchance, more highly paid consultants?

The timing seems most peculiar, since the Government has recently agreed to a significant increase in member nominated representatives (MNR) in the Local Government Pension Scheme and is making promising noises about giving more powers to MNRs in Governance Committees for Contract based pensions schemes and Master trusts. I fully expect the next Labour Government to continue with this process.

I actually support the important role played by professional advisers and consultants in running pension schemes and think many of them are honourable and genuinely want to do the right thing for us. However, there is no getting away from the fact that we have the fiduciary duty to our beneficiaries and they do not.

But as the full article in Engaged Investor makes clear, never forget the reason, why the requirement for member nominated trustees came about in the first place. The picture above is of Bob Maxwell in his famous yacht a year before his death, who stole hundreds of millions of pounds belonging to pensioners.This resulted in legislation that requires at least 1/3 of member trustees make up the Board.

The institution of trusteeship in this country is centuries old and although not perfect is still fit for purpose. Our primary role is to ensure that the money we hold in trust is held for the benefit of the beneficiaries and not be totally ripped off by those who are paid to manage our money. Even Adam Smith (not someone I normally cite on this blog) would have understood this.

In the past some trustees have not been properly trained and supported and have been held back on Boards. The requirement to have member representation and the growth of trustee based organisations such as the TUC Trustee network and especially the Association of Member Nominated Trustees (AMNT) will help counter these problems.  

Anyone who opens a newspaper or who turns on the telly to watch the news, will be aware on practically a daily basis, that we actually need more member trustees and representatives looking after all aspects of our money - not less.

AMNT newsletter October 2012 - meeting review; Fair Pensions invitation; Pensions Regulator message

- Download the reports presented at our last meeting
- Invitation from Fair Pensions during Living Wage Week
- Message to you from the Regulator

Dear member,

Last month’s AMNT members’ meeting was a success, with informative presentations and discussions on the thorny issue of investment management fees.

The meeting began with an overview of recent association activity from the co-chairs, Janice Turner and Barry Parr.


Barry explained how our efforts to sign up sponsors has been progressing well, with a couple of companies already signed up and a few more well on the way. We hope to provide you with full details of these when they are confirmed.

 



We then heard from Janice how the AMNT’s campaign to promote smoothing of DB discount rates was going well, with national press coverage and positive feedback from the pensions minister, Steve Webb.

 

There was then a presentation by Hari Mann of the RSA, who has worked with David Pitt-Watson on an influential report looking at the lack of transparency within investment management charges and how this can be damaging to pension savers.

 

The paper can be downloaded by clicking here, and the RSA’s other publications can be accessed by clicking here. Committee member John Gray’s review of Hari’s talk can be found by clicking here.

 

This was followed by a talk by John Simmonds of CEM Benchmarking. The company undertakes research into investment fees paid by pension schemes. His presentation can by found by clicking here.

 

CEM has offered AMNT members the chance to take part in their ongoing research. Schemes that take part will be entitled to a free personalised report. An example of such a report can be found by clicking here.

 



As an example of the type of information CEM would require, an example survey questionnaire can be found by clicking here. For more information on how to take part, contact John Simmonds by emailing johns@cembenchmarking.com.

Invitation from Fair Pensions

AMNT member Catherine Howarth, who is also chief executive of lobby group Fair Pensions, has sent the following invitation to members:

I would like to invite you to an event during Living Wage Week for pension trustees and other investors in FTSE 100 companies. The event, which is kindly hosted by Aviva Investors and in conjunction with the Living Wage Foundation, will mark 18 months since the launch of a collaborative investor initiative to promote Living Wage standards in the UK’s largest private companies.

The event will be an opportunity to hear from FTSE 100s that have become Living Wage employers as well as from a variety of investors who are supportive of the standards. It will be a chance to learn about the practicalities of implementation and about employer accreditation.

In May 2011, a £13bn coalition of institutional investors wrote jointly to the CEOs of the FTSE 100 inviting them to adopt Living Wage standards across their UK operations. Since then a productive dialogue between companies and their investors has developed on this topic, and a growing number of companies has either made progress towards Living Wage standards or has fully adopted and implemented them.

This event on November 5 will be part of Living Wage Week, which will see a range of events held across the country to celebrate the growing profile and uptake of Living Wage standards as a mark of organisational responsibility. The week begins on Monday morning with an announcement by Mayor Boris Johnson of the new London rate.

I very much hope that you will be able to join us. All members of the AMNT would be very welcome and it would be great to talk about whether you could notify people in the network. Please RSVP to Tom Scott (tom.scott@fairpensions.org.uk).

Pensions Regulator record-keeping message

We have also been contacted by the Pensions Regulator, who have written the following message for members:

In 2010, The Pensions Regulator set specific targets regarding ‘common data’ – such as name, address and date of birth – and gave trustees until the end of 2012 to achieve this.
 
The targets required that of these common data items:
 
- 100% should be in place for member data created after the beginning of June 2010
- 95% should be in place for member data created before June 2010.
 
By now, the regulator expects schemes to have taken significant steps to meet these targets. These steps include measuring their scheme data, and having a corrective plan in place where that data is found to be poor. Scheme administrators are ready to work with trustees on this, and failing to take action may lead to a breach of internal control requirements.
 
More information on record-keeping is available on the regulator’s website, including regulatory guidance, online learning resources and a new checklist for trustees.
 
To learn more about how poor data and record-keeping can impact schemes, join regulator staff in a 45-minute webinar at 11am on Tuesday October 16.
 
Regulatory case and policy leaders Victoria Holmes and Louise Hallard will discuss the risks of poor data as well as what action trustees should take now.  Places on the webinar are limited, so register now to reserve your place.
 
You can get on the regulator’s website by clicking here. You can also register for the webinar by clicking here.

Kind regards, AMNT Committee