The more I learn about the Equitable Life fiasco, the more I wonder who is in control of what we all do for a living. Its bribe for not suing is a good example. Time after time I read about this but no one stops the bus to say it is not right – you cannot bribe people not to sue as this will set a precedent for others to follow.
Supercilious people from life offices saying “we as an industry have no doubt lost authority after the pensions misselling scandal” do us no favours. Let me make it clear, it was largely those very same offices who missold opt-out and non-joiner cases who started the mess.
And it was the regulator/Treasury who misinterpreted the findings of a survey commissioned to find out what had gone on. IFAs who are dealing with phase two cases do not admit they are guilty of any wrongdoing and no amo-unt of placatory words from the guilty parties will alter what is actually the case.
By buying a way out of the problem (using shareholder and policyholder money) rather than fighting it as they should have done, they have messed it up for everyone else – they have sucked us into their own admission of guilt.
If those in charge had got it right from the start, consumers would have realised the problem was actually not as bad as first thought and their confidence would have been largely restored. As it is, they still think pensions suck and for no good reason.
Well done to all those in charge at the time. Not to worry, they are off messing up some other part of our country's industry – having washed their hands of any responsibility before leaving, of course.
Why do we let people who have no actual experience of a profession to run it – especially when they have limited liability over the consequences of their actions? They make decisions that affect thousands of real, lifelong professionals.
They will be “moving on” in a year or so, so feel little compulsion truly to understand it and make the right decisions. Where are all the people who oversaw the pension review in the early days?
Make no mistake, politicians and civil servants, just like the rest of us, have career structures to follow and aspirations to live up to. They do not make their mark by instigating sober and reflective legislation that is so often all that is needed. They make it by being dynamic and visionary, which, as we all know, is speculative and often wrong.
Frequently, the results of their actions can take years to materialise, sometimes in dreadful legislation that achieves nothing and makes many people's lives a misery. A change for change's sake – or rather the sake of a career.
It is not just in our game this happens. You only have to look at other highly regulated sectors to see the same effect.Take the prison world – the recently departed Inspector of Prisons, Sir David Ramsbotham tells a similar story. Sir David's background is in the military. There, he encountered chains of command with two words governing how these chains operated – responsib-ility and accountability.
Everyone was accountable for some function or activity, he explained in a recent press article, for which they are held responsible. In prisons, instead of accountability and responsibility, the main determinants are compliance with budgets and exact conformity with rules and regulations.
What is known as “the blame culture” seems to be in control. Everyone appearing to be doing their best to ensure that no blame could be attached to them for anything that goes wrong. In other words, they fill in forms, tick boxes and watch their own behinds just in case someone points a finger at them – the appropriate forms can then be waved back at an accuser.
In the meantime, prisoners remain unreformed – they continue to commit crime while more and more keepers of the peace fill in banal paperwork.
The same goes for us – we are weighed down by mostly pointless procedures that do nothing to protect the consumer. These procedures are mostly the result of some piece of legislation or other following the input of some wave-making minister trying to get up another rung.
They will claim it is for the good of the consumer. I would suggest it is not. Equally, it is not altruism on the part of the minister – and you can bet that the more you disagree with this, the closer to the top of some contrived political career ladder you are.
Tom Kean is compliance officer at The Analysts