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Ex-MAS boss recruited for British Steel member communication review

Rookes-Caroline-MAS-2013-500x320.jpgThe former chief executive of the Money Advice Service will lead a review into British Steel Pension Scheme’s communication with members about the choice to stay in a workplace pension scheme or transfer out.

Caroline Rookes, who left MAS in April, has been asked by The Pensions Regulator chief executive Lesley Titcomb to look into the “time to choose” exercise that ran from October 2017 until January 2018.

The old scheme’s roughly 130,000 members were asked to decide if they wanted to stay in the old British Steel Pension Scheme, which entered the Pension Protection Fund in March, move into a new workplace plan or transfer out.

The current review stems from the work and pensions select committee report on BSPS that recommended TPR conduct a review of communication around time to choose.

In May, TPR admitted it could have done more to help BSPS members understand the consequences of transferring out into defined contribution plans.

The regulator expects the review to be published this summer and says it is already working closely with the FCA and The Pensions Advisory Service.

The work is to provide an increased level of support to trustees and scheme members where there is uncertainty around the future of a DB pension scheme.

This includes providing letters for trustees to send members alerting them to the risks of transferring and giving practical information.

A TPR spokesman says: “We want to understand more about how members [at British Steel] were supported and the information they were given so we can produce information and support for trustees facing similar situations in future.

“Our primary concern is that DB scheme members requesting a cash equivalent transfer value have all the information they need to make an informed decision about what is in their best interests.

“This includes understanding the fees that are charged under any new pension arrangement as these can make a significant difference to the value of the fund.”

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Comments

There are 5 comments at the moment, we would love to hear your opinion too.

  1. The ‘time to choose’ comms issue is fairly simple to identify – too many words, to many non-member specific ‘examples’ and some figures factoring in inflation – making it hard for members to ensure comparisons were ‘like with like’.

    In summary, there was no simple and clear direct comparison between PPF and BSPS2 (which is what the Time to Chose was ultimately about) and information there was, was tricky to interpret.

    Oh, and an administration team at BSPS who were unable to meet the demand from members which arose as a result.

  2. This will be very interesting, what are the odds on where the blame will be pointed?

    The Time to Choose document and options form fuelled many members paranoia and desire to transfer and whilst a good document in some respects, it also left members confused.

    The Time to Choose document was very clear on two of the options, the BSPS2 and PPF. The transfer option information was very, very limited. The document clearly stated that if the funds were placed in the BSPS2 the transfer values would be less, with no transfer from the PPF.

    Now add the options form they had to complete, which had two options (not three), BSPS2 or PPF, no transfer option and the members believed they smelt a rat, that they were not being offered all the options, why? The members were fearful of the PPF and reduced transfer values from BSPS2.

    What further exasperated the members was MP’s, Trustees stating continually Guaranteed benefits. To any steel worker the work GUARANTEED means you would get what you had been promised. This was not the first time these members had seen their benefits eroded, so their emotions to say the least were running very high. They trust no one having in their eyes been let down so many times before.

    The extended retirement age, reduced benefits, loss of rule 11 (taking higher income in early retirement, reduced at state pension age) to many was the last straw. Many steelworkers decided enough was enough and are retiring. To achieve this many sort to transfer as the loss of rule 11 meant they could not achieve this goal without doing so. The thought of working 12 hour shifts days and nights to 65 was just to much.

    Many questioned could the PPF reduce the benefits in the future, was this guaranteed. Again this word Guaranteed, they did not trust anyone as Guarantees to them meant nothing and they believed the PPF would reduce the benefits in the future (which is not impossible).

    The meetings held for members arranged by the trustees only provided information on BSPS2 or PPF, again to the members this looked like they were being pushed towards these options by the establishment.

    Whilst I fully agree a small percentage of the total membership have been miss advised, should not have transferred, have been placed in incorrect investments and products, the vast majority most likely have not.

    When you have the FCA and the FOS disagreeing on what is and is not acceptable, how can anyone with any certainty state what was and was not correct. Then add pollical influence, pollical smoke and mirrors, political positioning and you really are confused.

    Yet I can already predict the outcome of this review. The trustees will have acted reasonably but could have done better, the politician could not have seen this coming, the regulator should have acted quicker, it had to be done to save British Steel and the advisers are to blame as we know they cannot fight back.

  3. What a weird world we inhabit where the criteria for appointments is that you must have failed miserably in a previous regulatory-linked capacity.

  4. I hope the investigation covers when the members actually got the documents, it doesn’t matter how good/bad the information is it has to be delivered in time for a member to make a decision and not feel under excessive time constraint.

  5. Caroline Rookes – the great communicator herself! Who could be better qualified than Ms Rookes to look at how to communicate a message effectively? What a joke!

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