I can understand Theresa May’s frustrations, I am a member of her party and have witnessed her “annus calamitous” up close and personal.
I am a fan of May’s, an endangered species, but I prefer her to alternative models
As a businessman, I am concerned about her threatened interventions on behalf of pension schemes. I suspect that Carolyn Fairbairn and the CBI share such concerns, ultimately companies must be self-determined, they cannot be run by their pension trustees.
Much as I would like, as someone dedicated to restoring confidence in pensions, to put pensions first, I don’t think that putting the sponsor second, is the way forward. If integrated risk management means anything, it means both sponsor and trustee – if not in harmony – in touch. We risk breaking that touch point if Government intervenes. We do not want the relationship between management and trustee to become mechanistic.
But I do want to see the Prime Minister exercising her authority so that ordinary people feel more confident about the pensions they are in,
A crack of light?
So while I am against Government intervening further in the delicate touch points between employer and trustee (the Pensions Regulator is quite involved enough), I do hope that Theresa May can find a way to exert her authority in other ways.
It was not until a recent meeting I was involved with, where a group of us was discussing the need for legislative change to take forward CDC, that such an opportunity presented itself.
Royal Mail has now announced to the London Stock Exchange that it intends to set up a CDC scheme which will pay its 140,000 staff a wage for life. The news has been greeted with some enthusiasm by the market 
The Pensions Industry’s reaction has been less enthusiastic and is properly summed up by Tom McPhail in Pensions Age.
The plans to launch a CDC scheme will be watched with keen interest by the pensions industry, which has very mixed feelings about the viability of such schemes.”
A rather more partisan statement comes from John Ralfe, commenting in the Times.
There are substantial headwinds to come and the confidence the market is expressing through Royal Mail’s share price may underestimate the challenges to come.
To make Royal Mail’s plan “viable” will need energy and commitment from Royal Mail and its staff”s union (CWU). It will also need that energy and commitment from within DWP.
Friends of CDC
Putting on another hat, I am a Friend of CDC and one of our aims is to help CDC to happen.
It strikes me that Theresa May would be well advised to make CDC happen too!
- It doesn’t need involve her with World War III with the CBI
- It can help improve industrial relations between Royal Mail and its staff
- It could pave the way for similar settlements in future
- It does look good on her CV
- It takes our mind off Brexit
- Sorting all this out is achievable within the present context.
That last point is debatable. I have now seen sufficient evidence from sufficient actuaries and lawyers , to support this view, but I admit that I am not the expert. I take others word for it – on trust.
Fortunately, I am not the only Friend of CDC, there are others, who are trustworthy and articulate and energetic and who are acting pro-bono as they want to restore confidence in pensions too.
In the gloom the gold gathers the light about it.
It would be very helpful for Britain if we made 2018 something rather better than 2017 and I do not subscribe to the view that this would best be achieved by kicking the current Government out.
I still believe that Theresa May is our best bet for a way out of the current complexities. Unfortunately she presides over a party which is denuded of pension expertise and is therefore floundering on the pensions front.
So I rather hope that somewhere in the serried ranks of civil servants and politicians, there is a person who can whisper in the Prime Minister’s ear that CDC might well be her best bet.
Lux in tenebris