Providers are forced to do the right thing

Each event follows a similar path. Poor practice is uncovered, the media publicises it, those responsible refuse to act, the publicity gets worse and eventually legislation or enforcement follows.

By this time, the whole industry is tarnished and the hard work done by the majority is undermined by the greed or inaction of a few.

The latest example is exit charges on pensions. Most individuals and companies accept that they are not justifiable or defensible any longer.

Administration costs yes – penal charges no. Yet some continue to charge them and will no doubt do so until legislation announced in the Queen’s speech comes into force.

If you constantly demand people save more while many are doing the best they can, you risk being ignored altogether

They could instead have quietly removed the charges; no story.

They could have waved banners to announce they were removing charges; positive story.

Instead they continue to impose them, leading to press campaigns and stories claiming another victory over a voracious industry.

And whether or not your firm is one of those charging you will, in consumers eyes, be tarred with the same brush.

The sad thing is that some senior people within the industry seem oblivious to the damage they are causing. And it must be senior people for firms to keep behaving in this way.

From pension mis-selling in the 1980s, to bank charges, PPI and any number of other issues, we have seen the same cycle of denial followed by capitulation. But by the time the capitulation happens the damage to the industry has already occurred.

It is a crying shame because the vast majority who work hard to create more prosperous lives for their clients and customers are continually stained by the odour of those who put a fast buck before long-term reputation.

In this latest example the story should have been all about the long-term benefits of investing in a pension.

Instead it is about how long-term savings can be plundered by greedy firms.

As folk singer Pete Seeger wrote: “Oh, when will they ever learn?”

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No saving graces

Do commentators from within our industry have any contact with people who live in the real wage-earning world?

And how much thought is put into comments before launching them on an undeserving public.

Let’s examine Royal London’s reaction to the Pensions Bill announced in last week’s Queen’s speech.

This was, Royal London, asserted “very disappointing” because it failed to address the “under-saving crisis”.

Its director of policy Steve Webb was quoted as saying: “Urgent action is needed to get employees saving more than the statutory minimum of 8 per cent of their pay, and also to get more than 2m self-employed people into pension saving for the first time.”

This is the same Steve Webb who was pensions minister for five years. I’d be the first to admit that he achieved more in that time than a succession of Labour pensions ministers achieved in the previous 13 years.

But if the action needed to get these self-employed people saving is so urgent, why wasn’t it urgent between 2010 and 2015 when he could have done something about it beyond being quoted in a press release?

And as for getting people to save more than the 8 per cent statutory minimum of their pay – well, I’d say 8 per cent is an achievement in itself when many have to pay student loans, mortgages and other household bills.

There are realistic aims and cloud-cuckoo desires. If you constantly demand people save more while many are doing the best they can, you risk being ignored altogether.

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Gold-plated pension blindness

Andy Haldane, the Bank of England’s chief economist, last week said: “I consider myself moderately financially literate – yet I confess to not being able to make the remotest sense of pensions.”

Let me help, Andy. You are a member of a £3.6bn scheme. It is a non-contributory scheme, meaning you don’t have to pay a penny into it.

Having joined the BoE in 1989 you probably benefit from a pension based on your final salary.

By 2029 you’ll have built a pension worth two-thirds of your final salary (quoted in 2014 as £189,606 – which is undoubtedly far less than you could have made in the private sector).

That, I suspect, is why you don’t really understand pensions – because unlike most of the other 38m million working population of the UK, you’ve never really had to make the effort.