OpinionNov 20 2014

Mas-sive fail over pensions guidance guarantee snub

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I do not know why any of us was surprised when Caroline Rookes, chief executive of the Money Advice Service, put on her smiley face and called in her public relations team to put the most positive spin on Mas failing to get the government’s guidance guarantee gig.

Although in initial discussions Mas was plugged to take a central role in the provision of the guidance guarantee, the final decision from the Treasury sidelined this unpopular and spectacularly expensive white elephant.

Naturally, Ms Rookes is not inclined to believe that the Treasury’s decision is remotely related to any criticisms of Mas’s costs and performance. Instead she thinks, “they asked The Pensions Advisory Service because it provides telephone services, and Citizens Advice because it offers face-to-face.”

When appearing before the Treasury select committee the Citizens Advice chief executive gave a dramatically better account of herself

But this is somewhat disingenuous given that Mas’s home page specifically states that it provides “support in person, over the phone and online”.

What is incontrovertible is that when appearing before the Treasury select committee the chief executive of Citizens Advice, Gillian Guy, gave a dramatically better account of herself and Citizens Advice’s services and funding.

All three organisations are led by women. Ms Guy trained as a lawyer and was chief executive of the London Borough of Ealing, is a non-executive director of the National Audit Office, chair of the British Bankers’ Association’s consumer panel, and was previously chief executive of Victim Support. TPAS’s chief executive Michelle Cracknell worked as a pensions adviser, company director at an adviser firm, actuary, Sipp and Ssas specialist and life company platform provider strategy director. Ms Rookes started work in a local benefit office and spent her entire career in the department for work and pensions and HM Revenue & Customs.

Citizens Advice costs £77.5m to run. TPAS costs £3.2m. Mas costs £80m. Citizens Advice is funded from local authorities, Lottery funds, primary care trusts, charitable trusts, companies, individuals and government grants. TPAS receives its funding from the DWP. Mas is funded by us, the financial services industry.

I’m sure Freedom of Information requests could identify the costs of dealing with their various enquiries, and a ‘pounds per call/letter/online query’ as a unit of measuring effectiveness would be instructive.

But whatever the measure, whichever way you analyse the organisations, their budgets, even their chief executives, TPAS and Citizens Advice taking the lead on the guidance guarantee has to be the right decision. Citizens Advice has the more trusted brand, while TPAS has the better specialist pensions knowledge and expertise. I do not think anyone, even Ms Rookes, can dispute that the Treasury has, for once, made a good decision.