40 years of pensions and counting

7 September 2010 0:00 am | Updated: 7 September 2010 8:48 am

On Monday 7th September 1970 I entered the life and pensions industry and forty years later I’m still there. I’ve been fortunate in having been continuously employed during that period –with seven different employers – and have been on the receiving end of three company acquisitions.

Those early days as an actuarial student seem like another world. This was pre-computerisation and pre-decimalisation. The most valuable skill in those days was dexterity on the Monroe mechanical calculator. Weekends were filled with sporting activity – in the winter with visits to random locations around London playing in the London Insurance Football league for Sun Life’s 6th team – they ran 9 teams at one time.

In the summer I led the combined Insurance offices tennis team in fixtures against other representative teams such as the combined services and the united banks. These matches were played on superb pristine grass tennis courts owned by the insurance companies and banks – assets that presumably disappeared from most balance sheets a long time ago.

I entered the industry on £20 per week -4 times the old age pension in 1970. Interestingly today graduate salaries maintain roughly the same ratio to the state pension – although jobs are a lot harder to come by. The world of pensions was just coming to terms with a major change in pensions tax legislation with the introduction of a “new code” of tax approval which aimed to rationalise and simplify existing pensions legislation. I still have a paperback which describes the whole new regime in just over 100 pages and much of my early career was spent dealing with legacy “old code” business.

Looking back my overriding impression is that most of the issues we are grappling with today have been debated many times over the last 40 years –and are still largely unresolved . The need for pensions simplification clearly isn’t new – it’s just that successive governments have added on more layers of complexity. The conflict between fiscal and social security policy has been
A lot of politicians have had grand ideas  Crossman, Castle, Joseph, Fowler, Lawson, Field, Lilley and Brown to name but a few – and yet 40 years later the problems look as large as ever. Two other names that have long since been forgotten are Nigel Vinson and Phillip Chappell. In the mid eighties they were strong advocates of personal portable pensions – but also of a higher basic state pension. The rapid advances in technology have left most of the life and pensions industry years behind and the vast improvements in longevity have created a huge and growing financial strain for both the public and private sector and a growing need for education.

Over the years I’ve been fortunate to have been at the forefront of a number of innovative developments. I’m most closely associated with the Sipp market which has grown in a way few anticipated when Sippss were launched in 1989. Perhaps my  greatest pleasure was to enlist the support of over 1,000 advisers in 1994 to persuade the government to introduce a new alternative to annuities. That led to the launch of income drawdown in 1995 – and personally to two trips to No 10. I also was fortunate to work with a number of very talented individuals in the early days of Winterthur’s Professional Advisers Division which launched a new “bespoke” range of commission free pension products in 1988 – effectively offering “adviser charging” some twenty years ahead of the FSA.

I suspect the future will involve more of the same – I can’t see any prospect of a solution to our pensions savings issues for many years – by which time I will hopefully be enjoying the benefits of an increasingly rare final salary pension – along with “flexible” drawdown from my Sipp. To quote from a heading in that 1970 pensions paperback – “plus ca change, plus c’est la meme chose”.

Suffolk Life director of marketing John moret

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