The pension map has two views of the world, . One view sees pensions as retirement savings and is governed by the FCA, the other sees retirement savings as pensions and is governed by the Pensions Regulator. It’s as binary as that . A cap B doesn’t happen (much).
It’s clearly not a helpful view. Mercator brought the two hemispheres together and that’s what the FCA and TPR say they would like to do – too! But it’s not proving that easy.
Both tPR and FCA produce business plans, reading them you can tell that they are both looking at the same world, but from different perspectives. Here’s the FCA plan (courtesy of Pinsent’s Stephen Scholefield, who’s comment I thoroughly agree with
Pension priorities for the @TheFCA. Can’t fault the aim of helping pension savers to make better choices and get value for money. But we need to be careful of information overload and must not simply add to the existing disclosure rules. pic.twitter.com/s7UgcZsS16
— Stephen Scholefield (@SjScholefield) 17 April 2019
People who don’t do the FCA (the TPR lot), may be surprised to know that the FCA don’t just do pensions. They do an awful lot more and most of it has got banking stamped on it.
They’re responsible for good consumer outcomes on all maters financial and pensions is only one continent.
How the FCA see pensions
I travelled down to Stratford yesterday, avoiding the perils of protest hit public transport and winding through the Hackney Road, Victoria and Olympic parks in beautiful sunshine.
I’d been looking forward to meeting FCA Chairman Charles Randell for some time, he had asked me to talk with him about pensions and investments and that’s what we did- at some length.
He and Andrew Bailey have overall responsibility for the FCA but the discussion we had was remarkably detailed. We focussed on value for money, disclosures, retirement outcomes, collectives and protecting consumers. We talked about how we harness digital, how we simplify decision making and the relationship between Stratford and Brighton.
I got the impression of an enlightened despot. The FCA does not see pensions as I see pensions , but they want to understand what makes people passionate about a wage for life – an AgeWage.
Learning to live with the FCA
For most of my career – certainly since 1987, I’ve been regulated by the FCA or one of its previous incarnations. My authorisation has been as an IFA and as a representative of an insurer. I’ve also been authorised in Jersey, the Isle of Man , Guernsey and even Alderney.
But the FCA are a global regulator whose influence and reputation provides us with a passport to world markets. Without the regulatory reputation of the FCA, Britain, and London in particular would not be what it is.
Which is why we need not just to live with but ultimately to love the FCA.
Many of my colleagues at First Actuarial know nothing of the FCA, they get their permissions through the Institute and Faculty of Actuaries. Direct authorisation from the FCA is coming, not least because of the Asset Market Study but also because as risk is transferred from employers to their staff, support needs to follow it. Advisers are now having to advise people as well as trusts and employers.
Inevitably this means us travelling to Stratford where the FCA’s offices overlook Westfield shopping centre on one side and the Olympic park on the other. Physically – they are closer to West Ham United than anything else but the swan pedalos that float by on the River Lee below their offices.
Having moved out of Canary Wharf, the FCA is now a much more accessible insitution, it no longer intimidates through its physical architecture and location.
I am not intimidated by the FCA’s reputation because I know its people. I feel as much at home with the FCA as I do with tPR and am very grateful for opportunities to meet its people whether senior or not. I could happily share a pedalo with messrs Bailey, Woollard and Randell as I could the many people who don’t have the top jobs – including some very brilliant women.
I hope that the trend towards a more diverse regulator continues – the FCA was named as a top place for women to work last year.
Many top women on the other side of pensions including Charlotte Clark and Lesley Titcomb came from the FCA. Jo Hill at the tPR is another. While there may be a male hegemony on Stratford’s 10th floor, the women are coming!
What I hope I am painting is a picture of the FCA that goes beyond the business plan, of an organisation that is trying to help and reach out to the world of pensions characterised by the Pensions Regulator.
In the past , I have called for one pensions regulator. I was premature, but I still hope that the two worlds of tPR and FCA, Stratford and Brighton can move together. That A can cap B and vice versa – that we move to a single world view, that of Mercator – not of his predecessors.
Right now we need two regulators, but it need not always be so. When we can talk about security in retirement holistically, we can have a single pensions regulator. For now, we need more understanding and more interaction