I’m sorry to announce that I’ve been made unemployed. Not from my day job, thank Christ, at least not yet, but from my role as a trustee on the Telegraph’s staff pension scheme.
Farewell free avocado rolls from Pure devoured during four-hour briefings from our investment consultants. So long super-strong coffee during an update from the lawyers on the implications of section 58 (2) of the Pension Schemes Bill (2020).
I once claimed to be Britain’s youngest pension trustee – and was almost immediately disproved on Twitter – but now neither of those things are true.
Our little scheme has gone the way of so many others – subsumed into one of the rapidly growing master trusts. Our pensions join the nearly 17 million others already held within master trusts, according to the most recent figures from The Pensions Regulator. It’s no longer deemed economical to run small inhouse pension operations and stump up all the fees we have to pay to our advisers.
Luckily we had a say in where our scheme, and our membership, ended up and they will still be looked after by trustees. If we were handing control to an insurer without independent trustees on the board, I would be far less comfortable. The Independent Governance Committees providers must now establish are a step towards trusteeship, but they are certainly not the same thing.
When Robert Maxwell fell into the seas around the Canary Islands nearly 30 years ago he took the pensions of Daily Mirror journalists with him. In the aftermath of the media baron’s sudden and shocking demise it was quickly discovered that he had plundered the staff pension funds of one of his many newspapers in a desperate bid to pay off creditors.
Mirror staff had to accept write-downs on their pensions and – arguably – the resultant regulatory overhaul spelled the end of defined benefit schemes. Increasingly expensive, and with all the risk heaped onto sponsors, one by one employers closed plans until guaranteed income in retirement became an exclusively public sector luxury.
The rise of the lay trustee probably reached its nadir prior to the financial crisis. Since then professional trustees have slowly taken over from the lay men and women, and now the master trusts have come for us. Our savings will now be looked after by Kim Nash, an independent trustee at PTL, one of the biggest trustee firms, who chairs Fidelity’s master trust. The rest of the board comprises two other independent trustees, and two Fidelity staffers.
It’s great that a majority of the people looking after my money will be independent of the company making a profit from it. But I can’t help but notice not one of the trustees works in my office. Unless they’re hiding it on their CVs, none has ever worked in my profession either. Given the reputation of journalists that may be sensible, but it does feel like a backwards step.
Yes, if a young reporter has a question about the staff pension scheme – such as “should I bother to save into this thing or go on holiday to Ibiza instead?” – they could speak to the HR department or, if they were unusually precocious, someone at Fidelity. But that’s not the same as a quick conversation with me or my fellow trustees who can assure them, with confidence in the detail, that it most certainly is a very good idea to stay in the scheme, and what’s more, to put in as much as you can particularly when the company matches it.
I know Ms Nash and her board are excellent at their jobs and will always champion the interests of the memberships but they don’t know me, my workplace or my profession.
Perhaps the most important part of the trustee’s role is dealing with delicate and complicated death benefit cases. There is talk of setting up a “staff committee” or something similar. An advisory body with no power. This would at least give my colleagues a focal point to ask questions and give insight in those death cases where someone must decide who ‘gets the money’.
But we won’t be able to hold lawyers, investment advisers, administrators or the company to account with the sole aim of acting in the best interests of staff.
Independent trustees can have all the skills and knowledge in the world. But they also need to keep their jobs as trustees. They have something to lose; we do not. The passing of the lay trustee is inevitable, but that doesn’t mean it isn’t a tragedy.