In some previous editions of Pensions News (PN), attention has been drawn to what PN has referred to as “the pointless survey”. There have been, over the years, a lot of pointless surveys.
In other previous editions, PN has commented on a former pensions minister; Mr Steven or “Steve” Webb, and his apparent fixation with motor cars. Lately, a satisfying conjunction of circumstances has seen Mr Webb, his apparent automobile addiction and (unhelpful) surveys join forces to coincide with an experience PN himself has had.
PN objects to certain surveys on the grounds that they seldom disclose the questions asked to members of the public in order to get particular responses. Rather and as indicated, said surveys disclose only the answers people give or, more accurately still, they give the answer to one particular question which may have been asked as part of or at the end of a certain sequence of questions.
For instance; if one were asked (a) whether one had read “1984” by George Orwell, (b) if one would be concerned by the sort of totalitarian “big brother” state described by Orwell in that book and (c) whether it was a concern that someone, somewhere wanted to know all one’s financial details, it would seem logical for one to follow that sequence by saying it would not be a good idea for details of one’s personal and state pension savings to be collated by the State and put into one site which only “one” and any hacker with a computer and an internet cable could access.
Let’s suppose, on the other hand, that one was asked (a) how many employers one had worked for, (b) how many pension plans one had participated in (e.g. was it one with each employer?) (c) what the value of each plan was and (d) whether one had notified the pension administrators / providers each time one had changed jobs, moved house or otherwise changed one’s personal circumstances. Let’s assume that, like most of us, one was not 100% sure of the answers to (a) to (c) and gave a straight “no” to (d). It would then seem logical and sensible to say that having details of one’s pension in one place would be helpful.
According to a survey by an insurance company called Royal London, 58% of “advisers” feel that “the introduction of a Pensions Dashboard” would be a good idea. It “will encourage people to be more engaged with their retirement planning”. Research by another insurance company, Aviva, has, apparently, reinforced this finding by telling us that 28% of people do not review their pension savings with (according to Aviva) women “more likely to be disengaged …than men.” There is no evidence of a survey having been carried out which asked respondents to the above surveys whether they felt the questions they had been asked were leading questions.
Readers will recall that Mr Webb achieved a sort of anti-fame when, as pensions minister in the coalition Government, he declared, in 2011 that 2012 would go ahead and when, in commenting on pension reforms, he made a comment about pensioners spending their pension savings on expensive Italian motor cars. Mr Webb, now working for one of the insurance companies referred to above, has stated that a pension dashboard is a good idea. Other countries have them, stated Mr Webb (writing first for the insurance company and then in the Financial Times), so how is it that this country is “stuck in the slow lane”? The country and, more precisely, the Government should “move up a gear” he added possibly whilst pulling on his leather gloves and stepping into his new sports car.
PN was reminded of the influence of dashboards when he was driving his car down the motorway. As he pulled out of the inside lane to overtake a car which was travelling at what PN thought was an unnaturally low speed (the driver was busy sending what must have been a very important text and no, PN is not joking), PN pressed the accelerator of his car and the speedometer of said car jumped towards the national speed limit for motorways with the rev counter jumping towards the 3000 mark at the same time. It was at this point that a sound emitted from the instrument panel and a warning light winked on in an ominous shade of red. The light was in the shape of a flat tyre and it was telling PN that he needed to stop the car immediately in order to replace or repair his tyre.
Displaying Olympian calm, PN slowed down, moved back in to the inside lane and, perspiring lightly, told himself that he would get off the motorway at the next junction and check the air pressure on each of the tyres on his car – if not his blood pressure which had gone up owing to the bad news his car had just made him cope with. After what seemed like a week but what was, in fact, a matter of minutes, PN left the motorway, pulled into a garage and checked the pressure on the tyres of his car. The pressure in each tyre was as it ought to have been; there was no problem to be managed. Cursing uncharacteristically under his breath, PN got back in his car and drove off. The following day, the light warning PN that his car’s engine management system needed attention flashed red. In exasperation, PN made an appointment at his local garage and took his car there. The following morning, PN received a call from said garage to tell him that his car was fine and ready for him, PN, to drive away in. Gratefully, PN climbed into his car and switched the engine on. Immediately, the dashboard gave a “ding” and the engine management system light blinked on red - effectively telling PN to get out of the car and spend some cash on it. Feeling distinctly unloved by his automobile, PN strode back into the garage and explained that whatever it was that the garage thought it had sorted out had not, in fact, been resolved at all. A mechanic accompanied PN and drove his car around for about 10 minutes. During the short drive, PN explained what had happened to his car and told the mechanic, very gently PN thinks, that being told by the car dashboard that he had a flat tyre while driving along at 65mph was potentially bad for other drivers but particularly bad for PN, his blood pressure, his heart and his stress and anxiety levels. The mechanic looked at the floor and said some technical words to PN – almost none of which PN understood. PN did understand the word “vibration” and the word “mate” but the rest of the mechanic’s talk confused him. An interpreter (the receptionist at the garage in point of fact) told PN later that a bolt underneath the car’s engine was loose and that the resulting vibration had been sending “all kinds of messages” to the car’s on board computer. The solution was to tighten the nut holding the bolt in place. This was duly done and PN drove off; his car purring with delight at being driven again. For his part, PN sat grimly at the wheel and, every now and then, glanced balefully at the car’s instrument panel; daring it to give him further warnings.
The point about dashboards is that if they are clear, they can be helpful. It may be a good idea, for instance, if one could look at a screen which told one to stop making contributions to one’s pension fund in order to avoid a punitive tax bill. On the other hand, the screen may contain the somewhat depressing information that, although one is not going to get a tax bill for having too much in one’s pension account, the reason for this is that one doesn’t have much of a pension to start with. Also and as PN found the other day, dashboards can be downright misleading and, through this, can cause stress and expense. Just think; one loose bolt and one’s pension dashboard might indicate that it would be a good idea to move everything into the sort of split conversion, double-downdraft fiscal disappearance scheme run by Mr Bernard Madoff in the last decade. For those wondering who Mr Madoff is, he went to prison for running a giant Ponzi scheme which swindled apparently intelligent investors out of billions of dollars. To Mr Webb (whom PN normally has a lot of time for), it does not follow that the fact that Sweden and the Netherlands might be doing something means, of itself, that that thing is a good thing. A pension dashboard may be a good idea (PN actually thinks there is something to it but he has his sceptic’s head on today) but not for most of the reasons PN has read about to date.
Finally, a side-swipe at some of the surveys he has read about; PN carried out two surveys earlier this week. In one survey, 100% of those questioned felt that a pension dashboard would be a waste of time. In the other, 100% of those questioned said that a pension dashboard would be a good idea. Thankfully, PN will not be carrying out a survey in relation to the forthcoming referendum of continued membership of the European Union.
Until next time……