Bim Afolami

Stephen Timms -WPC Chair

The DWP has a long list of duds, it has developed a capacity to convert a popular idea into a product that is singularly unloved.

The list includes the DB pension, the CDC  pension , the pension dashboard and now the pension superfund.

All of these have in common populist enthusiasm , regulatory capture and ultimately a failure to deliver anything for the common good . That Royal Mail may open its CDC plan at some stage later this year, that we may get a dashboard at the back end of 2026, that we have DB funding regs that don’t entirely kill off the DB sector does not account for regulatory success. Add to this, the stalled VFM framework ,  a four year consultation on small pot consolidation (yielding nothing) and a consultation on the state pension age which has been left unpublished and we have an unparalleled  litany of policy failure.

There is only a certain amount of credit that the DWP can take for auto-enrolment.

This is the context for Stephen Timms’ rather testy letter to Bim Afolami , wondering just what Bim thinks that the Treasury’s new soft line on DB consolidation through pension superfunds has achieved.

NEW: A parliamentary committee has asked the UK economic secretary a series of questions about the Govt’s intentions for a new #pension “superfund” framework.https://t.co/KWg7rB58WS

— Josephine Cumbo (@JosephineCumbo) January 30, 2024

Here is the letter

Timms has what can be called an “inquiring mind”. He is interested that after 6 years of consultations and a year of Government posturing on its intent for Pension Superfunds, the sum total is one superfund , one scheme consolidated and its destination “buy-out” by an insurer in a handful of years.

Much as we applaud Clara#, we cannot help siding with Timms when he insinuates that the Government’s flagship policy isn’t quite taking off. He asks

• Whether primary legislation is needed for a permanent regulatory framework forpension superfunds (Q335);

• What changes to the gateway test addressed your concerns about the pensionsuperfund regime.

Because the Pension Superfund is stuck in the wet cement of regulatory rigidity and in terms of superfunds, TPR is regulating the quietest graveyard.

What has happened to the Pension Superfund itself? I can tell you, Britain’s most entrepreneurial pensions enthusiast, a man so onside with the Mansion House reforms that he could have written Jeremy Hunt’s speech, is not even considering having another go .

Where are the new contenders? Who apart from Edi Truell has dared to take on the vicious ascent to the point where a superfund can take money?

There may be people in the Pensions Regulator that feel proud that they have seen him off but what have they achieved. They have simply mortified the graveyard. For all the talk about a new mindset, I see little evidence of anything happening other than the deferred annuity called Clara.

But not only have they fought Truell off, they have sent a clear message to any young pretender which is “don’t bother”,

If the Government really wants to encourage Pension Superfunds it will do what Governments do and make them happen.

Stephen Timms is – in his oh so subtle way – calling Bim Afolami’s bluff and he knows full well that Bim is holding in his hand a busted flush.