Exciting news! This month I’ve got together with Chris Dell, Tara McCorquodale and Caroline Brown to launch the The Scale Partnership – Financial. We’re pooling our experience at a time when we think the industry should be talking more. Over the last four weeks, I’ve also explored how the Labour government addressed the problems with workplace pensions at the start of the millennium. The first post examines how the Pension Commission came into being and how its chairman established his ‘killer facts’. The second takes a look at the key recommendations including the introduction of auto-enrolment. An article surveying the defined benefit superfunds was published in the latest issue of the Pension and Lifetime Savings Association’s Viewpoint magazine. And I returned to Times Radio to talk about BP and the impact Climate Action 100+ has had on the oil major’s commitment to achieve net carbon zero emissions.
The Scale Partnership – Financial
It’s tough running marketing in the financial services sector. You know differentiation is vital, but it’s hard to innovate in a highly-regulated industry. Your team’s pulled in many directions trying to demonstrate value. And budgets are tight. That’s why The Scale Partnership – Financial got together to use our experience and ideas to help. We’re writing a series on responsible investing. Read the first article here and let us know your views.
Rebuilding the UK’s private sector occupational pensions
After chronicling how different policies in the nineties turned defined benefit pensions from a useful recruiting tool into an expensive liability, this post looks at how the Labour government responded to this crisis with the formation of the Pension Commission. It examines how there was an initial push-up back from the Treasury about the scope of its review but eventually an evaluation of state pensions was included. And it shows how its Chairman, Adair Turner, established his three ‘killer facts’ to illustrate the scale of the problems.
Auto-enrolment: the Pension Commission’s big idea
This article examines the scope of the policy recommendations made by the Commission, such as simplifying state pensions so they can be used as foundation on which to add workplace benefits. Increasing the State Pension Age had been a political hot potato no-one wanted to touch but the Commission managed to make this a policy recommendation by underlining the impact of increasing longevity and working hard to build consensus. Finally it discusses the ‘big idea’: using the lessons of behavioural economics to use inertia to encourage people to save over the long-term through auto-enrolment.
Surveying the superfunds
In light of The Pension Regulators’ guidance for defined benefit superfunds, this piece (pages 22 to 24) examines the latest moves towards consolidation. These funds offer similar benefits to buy-out by an insurance company but at lower cost. The impact of covid on the economy could make this a more appealing idea as it offers a way for trustees to protect their pension should the sponsoring company go bust. While there is greater clarity about how these funds could operate, there are still issues which need to be resolved.
BP adapts for its survival
On the Early Breakfast show on Times Radio, I discussed BP’s most recent results. We talked about how the covid-induced recession caused the oil price to fall accelerating the long-term decline in the value of fossil fuel assets. The company is currently reducing its workforce and building up its green technologies. Institutional investors are playing their part to force this strategic shift through the Climate Action 100+ group and persuading BP to commit to net zero carbon by 2050.