Building up steam

Describe your role at the Personal Accounts Delivery Authority
It is week five and I am clinging on the edge of my own particular learning cliff, but I am really enjoying myself. My background is in retail banking so I am familiar with some concepts but there are some important areas where I have to learn a lot.
The main purpose of PADA right now is to advise the department for work and pensions on the up coming Bill which will become the 2008 Act.
It is incredibly important to design and build something which is as simple as possible. I feel very strongly that I have a duty to ensure every saver’s retirement income will be as big as it can be.

How do you think your past experience will help you in this role?
The first thing is that I have done four reasonably significant builds of things of scale in the past. I was heavily involved in the creation of Switch and Maestro where I cut my teeth in payments. The next project was the pre-pay debit card Mondex which was brought in on time and on budget.
At NatWest I led a £700m programme to build a new retail bank, it was very complex. That was a big challenge that I really enjoyed. The fourth was Simpay, a payment system for mobile phones over in Europe.
I design and build things to the best of my ability which are reliable and cost effective.

What role is PADA taking in constructing the second Pensions Bill?
It is very important to understand that this is a DWP Bill and it is introducing it. The department has a very talented group of people working on that. It is the government’s Bill.
The government created PADA to advise and we are working very closely. If we see something which was going to make it more complicated for employers I have to say something.

What role – if any – will education play in the introduction of personal accounts?
There is a definite role for education to play but education is a broader issue than personal accounts. We are obviously interested in the outcomes of the Thoresen Review on generic financial advice. There is a broader issue around educating people on saving.
Personal accounts will need to be very clear in its own communications. The scheme is targeting employers some of whom have no background in pension provision and for whom language like annuities and decumulation is not familiar.

Are you still on track to deliver a 0.3pc annual management charge?
I do not know yet. Many people have said that in the long term that is an unworkable starting point. At week five it is too early to say we have it in the bag.
When the Pensions Commission came up with that figure they had not really factored-in start-up costs. From work I have seen so far it is unlikely we could start at that point.
Around 0.5pc could be an aspiration for somewhere to start from. That is not definite, it is very a important issue. The guiding principle here is low charges but I’m still in the process of gaining my own view.

How is PADA working to prevent levelling down?
I am working hard to understand the nature and scope of that issue. I understand that concern in theory but I have not been shown any evidence that in practice it is a big issue.
I know quite a few people who offer good workplace pensions who would have no intention of reducing benefits because they know they are a very important part of their remuneration packages and their employees value them.
There are some employers who may not offer more junior employees a pension and this is where personal accounts will play a role.
PADA will work in a very open way. As well as official consultations we are also going to have informal meetings to get find out what people’s views are.

In light of previous government failures on large scale projects how are you going to ensure personal accounts run smoothly?
All I can do is the best job I can. If you go into the private sector you find successful projects and unsuccessful projects. The same is true for the public sector. I have a track record of building things of this scale that work.