UK - Independent pensions expert Ros Altmann has attacked the Financial Services Authority for refusing to accept any responsibility for losses incurred by scheme wind-up victims.
The attack follows a meeting between Altmann and FSA chief executive John Tiner and consumer director Anna Bradley when both denied FSA booklets had misled scheme members over the security of their final salary schemes.
Altmann pointed out page five of the booklet FSA guide to the risks of opting out of your employer’s pension scheme, states: “Some types of employers’ schemes (the ones called ‘final salary’ or ‘defined benefit’ schemes) give you a guaranteed pension. The amount of pension you get from a per-sonal pension is unpredictable.”
Altmann accused the regulator of “blatant hypocrisy” and claimed that if a financial services company had acted in the same fashion as the regulator, it would be forced to compensate people.
She said: “For John Tiner and Anna Bradley to sit there across the table and say we never expected anyone to rely on the booklets is blatant hypocrisy. How can there be one set of standards for everyone in the financial services industry and another for the government and the FSA?”
Altmann is using the FSA’s literature as part of her evidence to the parliamentary ombudsman Ann Abraham. The Pensions Action Group has gone to Abraham in a bid to get full compensation for members’ losses.
The PAG believes that the government – through guidance issued by the FSA, as well as Occupational Pensions Regulatory Authority and the department for work and pensions’ Pensions Service – misled scheme members and should compensate them fully.
Abraham is expected to reach a decision by September.
The Pensions and Lifetime Savings Association (PLSA) has announced it will shrink its board by more than one-third as part of a governance overhaul to make it "agile and more appropriate".
Smaller FTSE 350 defined benefit (DB) schemes were nearly 15 percentage points less well-funded than larger schemes in 2017, according to a Goldman Sachs Asset Management (GSAM) analysis.
The advent of collective pension systems could help the UK avoid demographic challenges which will make it "impossible" for society to help savers in retirement, experts say.