The favorites fell , the speculative won! A memo for those speaking today!

This is a short blog that reminds myself that I am talking this afternoon with both TPR and FCA and must know the focus of my approach. It is this. For as long as I can remember (my memory before we had the PPF is dim), the PPF has been something that must be protected by TPR and coveted by the Treasury as a means to keep the state from having to bail out failing pension schemes.

But the PPF is now a success with a huge surplus over what it needs to meet its obligations and the likelihood of it being needed in future is receding as pension schemes take less and less ambition/reliance from investments. The truth is that we have demanded sponsors pay the contributions to meet the shortfalls from the lack of returns from this “non-investment” of pension funds.

We need pension schemes to take responsibility for paying more rather than protecting the PPF and this needs the PPF and TPR to agree to encourage rather reduce risk taken.

I sat next to people at dinner last night who are life actuaries and whose job it is to put DB schemes to bed for the final time through buy-ins and outs.  It was good to speak with them for they were clearly keen to do a great job. But they were of an age that they never knew of a world when pensions did marvellous things with money.

The ridiculous thing is that we have the PPF being protected by de-risked pension schemes when it should be allowing these schemes to invest with freedom, certain that they have a backstop if things go wrong. Section 58 of the Regulator’s code makes it clear today that trustees who try to invest with intention of doing great things are in risk of jail, this should not be the case.

So my short blog is to encourage those who I know to be speaking today, including myself, to have courage and not to allow our vigour to be suppressed by the dead hand of the past 20 years.

The PPF is an insurance , we need no other. We must make those trustees and sponsors at PLSA today confident that they can do something, can carry on and can achieve good things for pensioners and the country they live in.

As for the DC schemes we have, these must remember they are pension schemes and not a means to prime wealth management.

So on we go. We may fall as Constitution Hill did in the Champion’s Hurdle, but there will be other races for us and we need to keep on and not give in!

Well done Golden Ace, his jockey, trainer and most of all his owner (Ian)  who insisted he went out to win the Champion Hurdle when an easier option existed.