John Greenwood

I am glad that Sam Seaton has finally made it to the VFM podcast. She has now been working with John Greenwood for well over a year on CAPAdata and reporting on how the megafunds are doing relative to each other. CAPAdata is doing what the Pensions Regulator will be doing .

The transparency of CAPAdata’s numbers are splashed across the last 15 minutes of the pod which deal with the value we got for our money since DC workplace pensions arrived.

You can access this and other podcasts here.

If you key in to 58 minutes on this podcast you get to Sam introducing the “pension lottery” that means that in terms of real money , you’d have got £58,000 more from having  £100,000 in a pension pot five years ago invested in the best default fund – than you would have had in the worst. The numbers are even more dramatically divergent  over ten years.

Sam had reckoned that the divergence between top and bottom would have 10-15% not 50%+. She was shocked when she saw the number as we all should.

But transparency is not easy to publish. I last saw Sam at Chris Sier’s funeral and we talked about the transparency that Sier’s ClearGlass and AgeWage (that Chris helped found). Despite endeavours to improve transparency for the consumer, little has been achieved over the time Chris and I were trying. The baton has passed on.

The wonder is that John Greenwood and Sam Seaton are treading the tightrope of VFM – politely pointing out that not all savers are getting value for money but doing so all the same.

A brilliant last 15 minutes

There is a lot of football in this podcast and so I liken this podcast as 60 minutes of chit chat and 15 minutes of goalmouth action – all at the end!

Even if you don’t scroll back to the start of this podcast, listen to the last quarter of an hour for what VFM is all about. It is about the iniquity of a system which gives such huge disparity in outcomes for the users, depending on the choice of workplace pension and the performance of the default fund.

For Sam, the iniquity is made worse by decisions being taken on what default fund to be invested in not by the saver but the saver’s employer.

The availability of the CAPAdata’s analysis is not free to the people who are taking all the risk, we can only see (for free) the last five year’s results. This is not a question of transparency but of commerciality, John Greenwood and his team (including Sam) need to recover costs and pay themselves.

But the problem remains. Those who took the risk are not getting VFM numbers and where is the incentive for transparency? The only employers who will want to display the position of the workplace pension they chose will be those who chose well while the employers who bought badly, will point out that there is no advantage to them from a VFM study.

Sam is Australian and despite a career working in the UK she can refer back to her native country where the choice of Super savings account is with the saver (the person taking all  the risk). Listen to the last quarter of an hour of this podcast to hear her outrage mounting!

If you think it fair that two savers for their retirement should get such different outcomes for their money then you are probably like Sam – in a Self Invested Personal Pension where at least you have control.

But this quarter of an hour sums up for me the unfairness of the DC system we have , where there is no measure of value for money and where the huge asset which is a person’s pension pot is not even given an end of term report.

My hope is that we see the CAPAdata reporting system catching on. I wanted a more precise AgeWage system to be taken up and it may still. But, along with most people, I  thank Sam Seaton, John Greenwood  and indeed the VFM podcast for keeping this issue in the front of mind.