Pension Playpen coffee morning cleared  the air over Pension Bee’s much criticised letter to Guy Opperman.  You can watch it  by logging in to your account at http://www.pensionplaypen.com and following the events tab to the session or by signing up to Pension PlayPen at http://www.pensionplaypen.com

There are two matters which are particularly contentious. The first is local, do Pension Bee’s (and all its competitors) “refer a friend” promotions count as transfer incentives or are they just gimmicks which can be ignored in the spirit of the law. The legal community is split on this, trustees are split on this , the executives of schemes are split on this. I want to like and trust PensionBee but when they falsely accuse other firms trustees of misconduct for PensionBee’s PR benefit it makes it harder not to believe it’s a cynical direct sales organisation hiding behind a warm and cuddly facade. I can’t thing of any acceptable explanations for it.

 

I want to like and trust PensionBee but when they falsely accuse other firms trustees of misconduct for PensionBee’s PR benefit it makes it harder not to believe it’s a cynical direct sales organisation hiding behind a warm and cuddly facade. I can’t thing of any acceptable explanations for it.

The second issue is not local but general and is aired below by Andrew Warwick Thompson in a comment on linked in.  Andrew is a Trustee of Cushon and Chair of the Trustees of the Scottish Widows Master Trust. You may agree with his view that consumer interest lies with consolidating through master trusts, that is a matter of opinion. But can the Trustees of master trusts influence member decision making by throwing flags, referring members to MPs and slowing down the transfer process?

There are important principles at stake here, principles that need to be agreed as soon as possible. There’s no doubt that some people want what the Australians call “self-managed accounts” and I know several Trustees of Supers who share Andrew’s view that members would be better in a collective. But in Australia, the member’s wish is paramount.

Here’s what Andrew’s got to say in his recent post.

I agree Ros Altmann. What is the rush? I am also concerned about the direction of travel here. We have been at pains to for the last decade to say that consumer interest lies in establishing a regime for safe, scalable, well governed, value for money authorised master trusts. The DWP and TPR are exerting great pressure on single employer DC schemes to demonstrate their value for money and, if they can’t, transfer their members into a master trust. Consolidation has been the watchword for good member outcomes. Yet we have providers offering incentives for members of those same master trusts to transfer into single member personal pensions, fragmenting the provision of DC pensions all over again. If a small DC scheme is not value for money, how can we be sure a personal pension is? And what is the mechanism for ensuring that this process of DC consolidation into master trusts followed almost immediately by a process of onward transfers into individual policies is in consumers’ best interests?

It’s worth reading the whole thread – started by Ros Altmann, which shows just how far apart the two sides of the argument are.

Pension Bee is calling for a “switch guarantee” so that standard transfers are completed in 10 working days from the transfer request being received.

So  hear what Romi Savova has to say. Let’s see if we can move this debate along a little – do we need a 10 day switch guarantee? Is Pension Bee incentivising transfers? Are trustees abusing their positions to influence “the direction of travel” of member’s money?