As a senior director at Allied Dunbar just over a decade ago, John Jory had a jetsetting career. He worked at the firm’s offshore subsidiary on the Isle of Man and then lived in Spain for five years, setting up Allied Dunbar International, but in 1995 he gave it up to return to England.
“My teenage daughters set down the criteria for their development. They wanted to finish their education in one place,” he says.
Swapping paella, sangria and Madrid for roast ham, pale ale and country life, Jory moved back to the village of Rusper, near Horsham in West Sussex, where he grew up. There he found a new lease of life when asked to join B&CE, one of the biggest providers of pensions, accident and life cover for the UK construction industry.
B&CE counts more than 6,000 employers, from blue-chip construction behemoths to small family-run businesses, among its customers. As deputy chief executive and director of B&CE Insurance, Jory oversaw the launch seven years ago of one of its flagship benefits, the EasyBuild stakeholder pension.
The EasyBuild scheme replaced the company’s previous occupational pension scheme, giving lower-earning workers the opportunity to build up a more meaningful retirement fund.
“The previous scheme was designed only to provide retired members with a modest tax-free lump sum worth about a year’s earnings. It was expected that they would get their income from the Government’s earnings-related pension scheme. But that did not materialise in the way we expected. The lump sum was providing members with the icing on the cake but they were not getting the cake.”
Launched almost a decade ago, stakeholder pensions have received a modest level of uptake. But with around 200,000 active members at any time, EasyBuild is a major player in the market.
“We have showed that with the right provider and the right product, stakeholder pensions can actually work. They could be the appropriate pension arrangement for the future.”
With the advent in 2012 of personal accounts, which the Government hopes will incorporate even lower charges, could EasyBuild become unstuck? “Absolutely not,” says Jory. “B&CE offers the individual the benefit of dealing with a not-for-profit organisation that knows and understands construction workers.”
He says the organisation has a number of crucial strengths over personal accounts, including a strong bond of trust with its membership. “We understand our customers and have that personal touch. The members also know we are not going to rip them off. They know we are not going to missell.”
Members also appreciate the fact that, without shareholders, the organisation is able to pile revenue back in for their benefit.
“We receive thank you letters all the time from members of the old pension scheme when we top up their fund. It is so gratifying when they take the trouble to get in contact.”
But to remain competitive on charges and retain a level playing field, Jory believes the Government needs to tackle the issue of auto-enrolment. “Personal accounts will probably have a 50 basis points annual management charge. If we can get past the problem of auto-enrolment, then EasyBuild, which currently has a charge of 80 basis points, can get close to 50 per cent.”
However, Jory is concerned that 2012 could actually provoke large numbers of people to opt out of pension saving. With perceptions that retirees who have saved for a pension may be no better off than those that have not, he believes people have become complacent.
“We did a survey in which 60 per cent of those we interviewed said they were going to rely on the state but, worryingly, 50 per cent did not know how much they would receive. Yet they still expect at least one foreign holiday a year and not two weeks in Skegness.”
He believes the public are looking for reasons not save for their retirement. “Some even believe they could end up worse off in retirement. We must not be putting doubts into people’s mind like that. The only solution to get people to save for their retirement is compulsion.”
Jory says lack of understanding among the public deepens the complacency about pensions and other financial issues. He believes the Government has a major role to play in teaching children about finance from an early age. “We teach children who was the king of England in 1400 but not about how to be financially savvy when they leave school.”
The consequence, he says, is that a 20-year-old with £100 in his pocket at the end of the week does not consider saving for a pension. “Is he going to put it away for his retirement in 40 years time or go down the pub for a few pints? Unfortunately, there is no competition.”
Battling against this logic, B&CE takes special pride in the efforts it takes to provide briefings and presentations for its members.
“We might be in a Portakabin by a railway site in North London at 10.30 at night because it is the only time people are available. We explain in simple language what we and their employer has to offer and advise them on how they can start to save for their retirement.”
Born: Horsham, West Sussex, 1947
Lives: Rusper, West Sussex
Education: Forest School for Boys, Horsham
1995-present – deputy chief executive, B&CE;
1990-95 – director of systems and administration, Allied Dunbar International;
1985-90 – managing director, Allied Dunbar offshore subsidiary;
1979-85 – systems manager, Hambro Life/Allied Dunbar;
1976-79 – systems analyst, Alliance Building Society;
1971-76 – data processing manager, S Casket;
1965-70 – data processor, Central Electricity Generating Board
Likes: Roast ham, sport, travelling
Dislikes: Curry, bureaucracy, driving
Drives: Audi A4
Book: Neither Here Nor There by Bill Bryson
Film: Father of the Bride
Album: Brothers In Arms by Dire Straits
Career ambition: To remove unnecessary obstacles to pension cover
Life ambition: Daughters having a secure future
If I wasn’t doing this I would be…
Creating bespoke tour itineraries for tourists in New Zealand