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Mum can't get her full pension pot even though she hasn't taken anything
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Now that our new friend is sharing his wisdom with us on such a regular and lengthy basis, I wonder if we could get the MSE team to add a new button to fulfil the opposite function to the 'Thanks' button?0
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in statute. Making up law on the hoof which acts as an apologist's leaning post for the wrongs that are about to be perpitrated?
Are you the author, Daniel54? Or could you easily have been?
We operate on the basis of "rule of law" in this country and that does not mean that we follow every damned stupid idea of some individual in government who fancies his own interpretation.
Nowhere did I suggest I was quoting statute.However...
The Pensions Regulator paper is an outcome from the Government's public consultation concluded in Summer 2014.It is intended that the final proposals will form part of the statutory and regulatory regime for DB pensions with effect from this month.
The individual who brought this to Parliament was the Chancellor of the Exchequer,stating in July 2014
"the government will introduce two new safeguards to protect individuals and pension schemes: a new requirement for an individual to take advice from a professional financial adviser, who is independent from the defined benefit scheme and authorised by the FCA, before a transfer can be accepted; and new guidance for trustees on the use of their existing powers to delay transfer payments and take account of scheme funding levels when deciding on transfer values "
That's democracy for you,like it or not
I remain bemused why you disagree with the statement from the regulator which you quoted back to me.As I agree with it ,I would be happy to claim the credit .
Finally,there are all too many examples on these boards of people who have genuinely been scammed out of their pensions ,plus thankfully those who enquire here or on the Savings board and are deterred from a catastrophic decision.Concentrate on these rather than creating fear and distrust of regulations which have a legitimate aim to protect those who need protection ,imperfect though you might perceive them to be.0 -
Yes I have. I have been quoting it to law breakers for some time now. Pity Trustees only pay lipservice by publishing fancy little leaflets suggesting they are compliant rather thatn actually troubling themselves over it. What would be the point? There is no establishment appetite for enforcing any of it. It's too complex, and besides, it might hurt 'the wrong people'. The powers that be would rather keep things cosy with the corporates by negotiating slapped wrist style "fines" via the FCA which is actually about as much incentive to stop perpetrating fraud as a City trader invited to tea with no biscuits with his boss for sending a dodgy "thanks for fixing it" email that goes nowhere after clicking Send because it ends up cutely quarantined by the corporate risk boys sniffing the network for any inadvertent share-price damaging loose talk.Have you ever looked at trust law?
Trustee duties are pretty well established...
Can you name a case where a prosecution has been made against Trustees for breaking "trust law"?
Not it is not. The Chancellor is not a dictator. He cannot make law alone. We operate a parliamentary democracy, and we also live in accordance with nomocracy. The Chancellor is just one small cog in the wheel. Steve Webb is another cog. I wish they'd all work out what laws their crazy ideas might break if their ideas came to fruition, before they start suggesting their ideas will become law.Nowhere did I suggest I was quoting statute.However...
....
The individual who brought this to Parliament was the Chancellor of the Exchequer,stating in July 2014
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That's democracy for you,like it or not ...
Really? So you have a black and white notion of the operation of our world which conveniently excludes those who make DB promises and break them, and you then condone outright fraud by the promise-breakers and their minions in order to cover up?I remain bemused why you disagree with the statement from the regulator which you quoted back to me.As I agree with it ,I would be happy to claim the credit .
No, you concentrate on those, and I will keep my eye on the ball in the big picture, thanks all the same, Daniel54Finally,there are all too many examples on these boards of people who have genuinely been scammed out of their pensions ,plus thankfully those who enquire here or on the Savings board and are deterred from a catastrophic decision.Concentrate on these rather than creating fear and distrust of regulations which have a legitimate aim to protect those who need protection ,imperfect though you might perceive them to be.
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enough of this twisted, warped nonsense; another one for my blocked list. Ah the relief! :beer:The questions that get the best answers are the questions that give most detail....0
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Good, you flit back and forth amongst these pension threads like a restless little bird and then your sole contribution to this thread is a dismissive one-line insult. Well then that's one less "I'm all right, Jack - my pension worked out well cos I earned it" apologist we have to deal with in this thread.mgdavid wrote:enough of this twisted, warped nonsense; another one for my blocked list. Ah the relief! ...
We get the message - you're now retired and enjoying the view from the AI sunbeds which you earned and paid for, and you have enough cash sloshing around to have a bit of fun playing with it and MSE. Get a room
Now where were we? Seriously, all around us the talk is of being able to take your pension as cash when you want to - your pension as a bank account - but those of you in some surviving deferred DB pensions may not realise upon what kind of precipice your DB pension Cash Equivalent Transfer Value now sits. The latest implied rule changes are a real danger.
You will be familiar with coastline erosion in parts of the UK? Think of your CETV as once being a safe as houses entitlement, but that by various nefarious means in the last few years, it has quite likely ended up on the edge of a crumbling cliff as the sea of financial iniquity washes in and erodes the foundations, dumping them on unknown beaches out of view further down the coast. We are told that it is useless to fight it, and to resign ourselves to the new environment letting nature take its course. Life's a beach. Some lose a beach, some win one.
I worked for a blue chip for the first quarter of my career. As part of the package I had a non-contributory final salary pension. The good part is that it still exists, just. The bad part is that the blue chip is now part of another run by those enormously flakey smiley types from the life insurance industry. That's not natural. That's an enormous shame. Life insurance and pensions salesmen have never as a group been trustworthy. Remember double-glazing salesmen? Well tens of thousands of them moved on into life and pensions. Some of them fell by the wayside and sold solar panels for a bit, the sharper types elbowed out the old guard and ended up running the shows.
Over the years I have exercised my DB scheme right and asked for valuations for a Cash Equivalent Transfer. Ten times in all. Not often enough it seems, especially in the last five years. In the last five years it is beginning to look like I should have asked every year. I didn't. I asked in 2009 and in 2010 and all was well, and then only again recently, 2015. So after I had extrapolated my likely 2015 CETV from ten previous valuations over 20 years and used very conservative assumptions about what it now might be, I was amazed to find that the CETV had only grown 3% average over 5 years compared to figures much like audi321 has seen in the last 4 years:
Way back in post#79, audi 321 said:Since 2010 I have written almost annually for a CETV for my 1964 pension (I had 24 years service and a final salary of £38,000).
In 2011 it was £187k
In 2012 it was £322k
In 2013 it was £357k
It is now £498k!
Now at a casual glance, some lay readers might think well 3%pa is an ok rate of return, we had the financial crash (yes but that did not stop my CETV growing well between 2005 and 2009!) and the last 5 years also is the same five years that the bank base rate has been at all time lows.
Yes, yes I understand those who have DC funds who may not have done much better than 3% in the past 5 years, but typical DC fund performance or bank base rate isn't a direct pointer to how the calculated cost (valuation) of a DB pension promise will rise.
Ability to pay promised levels of pensions can only be achieved by investing scheme funds and growing them. And if the scheme fund capital is not enough, the employer company is obliged to contribute more capital to the scheme.
So if anything, with the low base rates, the investments needed to realise my promised pension will be have to be much higher than before when rates of return on investments were generally much higher. Same as audi321 has experienced. So how can the case with some other schemes (mine included) have been the exact opposite? It simply cannot be so without jiggery-pokery having occurred.
As I have explained earlier, and other's have commented, and even my employer company contact readily agreed before he was got at, there is an obvious inconsistency between the CETV given to me in 2015 and earlier CETVs because the economic environment for DB pension schemes especially with gilts forming a large part of the investments behind typical DB schemes, should have meant that CETVs have gone through the roof.
The difference ? Well I think that judged largely by the recent refusal of my scheme to engage in nitty gritty discussion about how they arrived at the latest CETV, is the now missing honesty and integrity. Interestingly it started with me speaking to a company employee (not the trustees) who interestingly is the prime contact for the outsourced scheme administrators. I thought they worked for the Trustees. Not as simple as that maybe.
Anyway, the first discussion was extremely candid and with full agreement that there was obviously something odd between my 2010 and 2015 CETVs, and there was a completely candid offer to not only double check the calculations, but show me, a scheme member with an untypically astute perception of how mathematics affects these things, how the two valuations were worked out.
Before that call ended, I volunteered that first my gentlemanly contact should only trouble to rework the latest and let me know the detalis and assumptions used so I could more or less calculate it myself. He could put the 2010 calculation aside until we had at least checked at the 2015 one, because there was always the chance I might be persuaded by the calculations.
I waited and waited and gently reminded. And then I got a call that told me that the 2015CETV had been miscalculated - not by the sort of difference I had originally queried, but nevertheless it was underquoted. It was wrong. It had been produced by a piece of software which had produced the wrong answer.
The discussion from that point became much more stilted. No the detailed calculations were not something the Trustees were obliged to disclose. Yes there were mortality assumptions that got taken into account other than UK general life expectancy. Postcodes were used by this scheme. Er ... why? And how is it relevant in 2015 when my correspondence address like mgdavid's will not locate him if he is lying on an AI sunbed?
No the 2010 CETV would not be looked into. It was guaranteed 3 months in 2010 and now it is a closed book and the basis of it is not something the trustees are obliged to provide now.
If I wished to take it further I could write to the Chairman of the Trustees (by snail mail).
Meantime, having started off February thinking my DB Scheme was likely to prove to be still in good hands, I now feel like the value of my CETV is teetering on the edge of a cliff which is being rapidly undermined.
This thread was originally started by someone concerned that his mother who worked at Barclays until well past retirement date for well intentoned reasons, had originally been refused a full CETV now she mosts needs it because she must now retire through bad health. Barclays originally were offering a lump sum and a reduced pension only. Barclays have subsequently relented. Probably because they have to account to a union for certain norms of agreed behaviour.
We have heard that the Barclays 1964 scheme is still producing good CETVs. One reason for it will be that there is a union representing a large section of deferred members of that scheme who are still working at Barclays, albeit now paying into a new scheme. There are group representatives who still know which tables to bang on, and there will be top level scratch my back, scratch yours type understandings that mean tables don't need to be banged too often. If they keep their heads down and do all they are told and otherwise keep their mouth shut, bank workers can still have a job for life and a very ok pension.
Conversely, my old insurance company scheme has almost no members now who still work for it. So there is no group protection for the members. We are all scattered to the wind and fending for ourselves. That's just how greedy corporates like their complainers to be. There are no group representatives to trouble the trustees and bang board tables.
It is probably 15 or 20 years since a "trustee" could be automatically trusted to hold an employer to the original DB pension promises. What many are doing now, and have been for some time in most cases, is the devil's work. They find it hard to admit of course. They are not necessarily the brightest.
I do not forget the approximate ten year period between the mid nineties and mid noughties when it became in vogue to say:"You cannot sue the employer for dismantling the pension scheme - these pensions were never part of the employment contract".
As so many of them were dismantled before the mid-noughties, we rarely hear that now, and remarkably instead, we are quite likely to hear frequent mention of:"The pension promise"
But in those intervening years, as our UK culture declines, a promise finally has become just a lightweight word in UK culture. Promises to love and cherish till death us do part are of course smiled at, now. Pre-nups are are more seriously taken word. Promises to give cashback are dismissed on the strength of broken cookies. Everything else of moral value in business practice is likely spilt milk down the drain and under the bridge old boy ...
Pension promises? Isn't that for twisted, warped seniors who far too late in their day expect a taste of modern life's pleasures without the wheeling and dealing necessary to have "earned it"? Surely you are joking, Grandad? A nice lump sum and a final salary pension. You really never expected that to really come out that way, now did you?
My latest CETV uses S1 life expectancy tables which are ten years out of date. New S2 mortality tables have been finally been published by the same professional actuarial body which suggest improvement in some life expectancy of imminent retirees of up to 17%, but the trustees refuse to use them. They also refuse to tell me how they calculated the CETV and how they calculated the 2010 CETV or indeed any CETV.
I insisted they check the 2015 CETV and after a two week further wait they found that even by their calculations they had understated it. The best they can offer is that the triannual valuation of the scheme is due at the end of this month. But I know better. I know that the end of this month is only the accounting date at which they will then attribute a value to the scheme as a whole - retrospectively of course - who values anything on the day any more? That would make for a period of being far too busy. No, the trustees (and not forgetting the company to whom they are totally beholden) actually have a statutorily allowed 15 months to cook the books as at 31st March 2015. Thereafter, they will perhaps modify the method and assumptions they are currently using to undervalue my CETV by tens of thousands of pounds.
But due to that invitation to fraud which Daniel54 kindly reminded lurks within the Chancellor's whims, and consequently is migrated into the regulator's consultancy clap trap, what else do we think the company and trustees will be feeding into the mix over the next 15 months?
The actuary who signed of the latest calculation method employs interns.
On a website where interns compare their experiences whilst working for companies which offer internships I read these snippets from one bright young thing who was reading Mathematics at one of the leading universities:I've learnt a lot about office etiquette and what working life will be like. We had some training sessions about mortality and how to use certain programems like Transcalc. I'm really glad I did it!
There were socials throughout. There's Friday night drinks. We were taken out to lunch many times. There was a boat party on the Thames (great fun!).
I was given client work right away. I was doing actual calculations and updating letters/emails/presentations that the clients would see. Of course it would all be checked first!
There was always something going on whether it was sports or drinks or a party or a small get together in the park for lunch.
It's London! Enough said.
Yes perhaps enough said. She stumbled over the word programs like Transcalc without realising that program in relation to software is spelled differently to programme as in TV or as at the London Theatre or Football matches, but we'll forgive that as long as the maths is correct. But hold on ... what maths?
And how did I have time to track down this apparently hardly relevant student talk? I didn't. I was looking for information about "Transcalc" because that was the "software" which is now used to calculate my CETV, and that word was presented to me as if Transcalc was some altar at which actuaries now worshipped. In fact that is exactly what it is and it is movable. They wheel it out (for a price of course - it is trademarked!) to pension administrators to play with and worship instead of asking a real live actuary to please get their sliderule out and calculate something approaching a trustworthy personalised CETV, mano e mano.
Nah. Transcalc gives everyone more time to go out to lunch on the corporate savings manufactured from the lowest possible valuations - possible that is as calculated by a computer programmed to use the minimum statutorily acceptable values in umpteen ranges of assumptions - guidelines ignorantly passed into law by politicians who wouldn't even know what a slide rule was ever used for!
Finance Director is happy, Chairman is happy, ignorant transferring members can have their calculated wodge of cash and like it and be happy (or lump it), interns who learn a bit about mortality are happy, everybody's happy :beer: - Right?
No. Wholly WRONG :mad:
It's London! Enough said? Not by half and then not even close ... but there as none as blind as those who will not see.0 -
It may be news to you, but whining & bleating to the literally tens of people reading your posts is not going to make any difference.
Either take the money or take the pension, your choice.
And to pre-empt your aggressive response, I came through an employers DC pension that was subject to fraud along with stupidly transferring my only DB pension to Equitable Life.
Didn't whine or moan to anybody, just got on with sorting it out myself & taking responsibility.0 -
It may comes as news to you, but I am not publishing here to assist my own case in anything other than the general awareness sense. My case is typical not unique. Others will Google and they will find.
I am one of the few people who has been close enough to the history of a variety of typical pensions arrangements and their downfalls over the past three decades or more who is able (through my maths and varied insurance background which taught me oh so much about small print and promises) and willing to go public with what I know and feel.
The pensions industry is as with the rest of UK Financial Services horribly corrupted.
This thread is about the sorts of things that happen to deferred members' CETVs in existing DB schemes. There are the good, the bad and the ugly, but it seems fair to conclude that the good is only supported by the constant vigilance of employee group representatives who wield power in the workplace via what remains of large trades unions. We cannot and must not rely upon the good being upheld by Trustees. They simply do not wield the power, and if they are company appointed then of course they do the employer's bidding. Most are employer company appointed.
I have just been filing old papers for an Aviva Section 32 buy out plan I was forced into by another DB scheme - one that was wound up prematurely simply to impress and satisfy greedy shareholders for another blue chip. That one had no member nominated trustees at all. Such trustees as there were waved goodbye in 2004.
Then the fun began on that just two short years later e.g. "Due to a technical fault there has been a delay in issuing the 2006 Yearly Statements forSection 32 contracts. This has now been corrected." (Normal issue date within days of the year end. Actual issue date June 2007 - 5 months delay). No explanation. Technical fault. A bit like Ryanair denials of liability in the bad old days of denied delay claims.
Then surprise surprise, the Aviva WP Reattribution was announced. Hold the press on those annual statements! Better not disclose the true values to the punters too soon old chaps because we need to minimise what we tell them is the performance of the fund so we can maximise the bit in the fund which we snaffle for the shareholders with the jolly reattribution wheeze! That's ok - take an extra 5 months to make sure you can "optimise" the fund for snaffling!
And after the reattribution I no longer get a statement of plan value each year on the dot, including transfer value. I get something lightweight called an Anniversary Certificate instead. If I want a transfer value I have to ask for it.
That is another story which I have touched upon in the Aviva Friends Life Merger thread. Another thread frequented by habitual apologists and naysayers.
Anyway, I have some very very thick files to organise, so enjoy your fun. Thank goodness I kept every scrap of paperwork.0
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