Opinion  

In MPs we trust

Financial Adviser

Having taken a sabbatical from personal finance journalism for the past 18 months, your leader writer can admit to having sat through almost the entire airing of last week’s Dispatches (Channel 4) in shock.

She happened to be watching it with her husband and her mother, who are not quite as close to the personal finance coalface as their trade journalist relative is.

But they, like yours truly, couldn’t quite believe that government legislation to encourage people to take more responsibility for their future pension provision was not accompanied by what appears (and appeared) to be some very simple safeguards.

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Such as requiring master trusts to have enough cash in the bank to provide an income for their investors – as in the people who they have sold their pension scheme to.

The Dispatches programme was thankfully followed by Financial Adviser’s own exclusive story which revealed last week that plans to put in place both capital adequacy and governance rules for master trusts is in the pipeline.

Yet while this is comforting, it is a restrospective move which should surely have been in place long before the first master trust was allowed to take a penny of investors’ cash.

Over 20 years ago - when this writer was starting out as a trainee reporter - the shock waves surrounding the Robert Maxwell pension scandal were still throwing up all kinds of nasty debris at the feet of the new financial regulators.

Then there was the personal pension mis-selling scandal - which overalapped the now deceased Mirror Group owner’s one, but whose aftermath was felt for many, many years afterwards.

The fault is entirely at the feet of those who legislate us.

Our government needs to think of new ways to make sure consumers get the protection they deserve, and the financial advice and security that is their absolute right. And if it goes wrong it should be they, and not the consumer, who picks up the bill. And maybe then something might get done.