Fresh from his visit to Parliament to explain to the Work and Pensions Committee why open DB schemes have a future (along with CDC) , he’s now joining us for Pension PlayPen Coffee Morning.
I worked with Derek when we were both at First Actuarial and came to rely on him to explain ideas that I didn’t understand. He taught me in simple language how liabilities are valued , how actuaries assess mortality and what words like “prudence” and “risk” mean.
He explained the concept of the open scheme “sweetspot” to me with this diagram, which I have used hundreds of times on this blog and in presentations to staff
For Derek, it’s open accrual that counts and not the particulars of the guarantees on offer. So he can talk about CDC and DB as interchangeable.
He is a lover of simple pleasures like flying kites and teaching people. He is a benevolent pedagogue and he’s one of the best explainers I’ve ever come across.
But he’s not just an explainer, Derek thinks things through from first principles. Back in 2009, the Government Actuaries delivered a damning verdict on CDC – consigning it to the actuarial dustbin. Derek, then quite young in his career, wrote a riposte that has become legendary and allowed CDC to fight another day. He tells me that he’d actually proposed that Stakeholder Pensions be CDC pensions back in 2001!
And when Royal Mail and the CWU union were in deadlock, it was Derek and his boss Hilary Salt who nudged the conversation towards what was then nothing more than an actuarial concept. Derek could properly be though of as one of the great advocates of UK collective pensions.
So I’m really pleased that we will be talking with each other for a few minutes after 10.30 am on Tuesday July 4th. Although the session is an hour, I hope that many of our colleagues in the Pension PlayPen will join us- and that if you aren’t in the PlayPen, that you sign up to attend this session.