Al Gore speaks at "Harnessing Capital Markets for a Sustainable Future"

This post is about the speech that former US Vice President Al Gore gave at the ShareAction (formerly Fair Pensions) annual lecture on March 15 in the City of London Guildhall.

By coincidence I was sitting next to UNISON Assistant General Secretary, Liz Snape and her eldest daughter.

The Lord Mayor of London welcomed the (packed) audience to this historic site. Catherine Howarth, the CEO of ShareAction spoke about the dominate role that finance plays in our economy and the impact on democracy. Also what impact pension auto enrolment will have when many millions of people will become shareholders for the first time.

Then “The Al Gore” came onto the stage. I must admit that I didn’t know that much about Al Gore but you have to admire the massively impressive, articulate, passionate, old fashioned barn storming 30 minute speech he gave. He put nearly all UK political speakers to shame.

I hadn’t realised either that he had started off life as a Tennessee farmer and he gave a typical folksy small town America tale (“I’m feeling fine – don’t shoot me”) which I have heard before but never said so well, which was to amuse and relax the audience.

He then praised capitalism as the most efficient and superior economic system there has ever been, then tore it down by reminding us of its many failings such as its inability to measure what is truly important such as social well being and climate change. He asked why is the atmosphere used as a carbon sewer?

He discussed the fiduciary duties of pension funds and the mandates and incentives given to fund managers. Why do pension fund managers only concentrate on the short term? – because that is what the pension fund trustees pay them to do!

In the Q&A I asked him as a UNISON trade union pension trustee if the failure of pension funds to make long term sustainable investments is due in part to the decline in recent decades of organised Labour. In the past workers and managers worked together as partners. He said he had never been asked that question before but would think about it (which meant he either thought it was a brilliant unique insight... or that no other idiot had ever asked such as stupid question before). He did say that union nominated trustees can make a real difference to the way their funds are managed.

He asked us to think about what are the values in the boardroom you invest in, how does a company treat its employees and the communities where they operate. There should be a systematic investigation of sustainability factors as a necessary part of any investment process. The current system is functionally insane and incentives drive towards systemically irrational decisions.

(and I agree Mr Vice President).

Fund managers index of shame

Fair Pensions have issued their latest rankings of "ethical" fund managers.

Which to be absolutely frank is deeply disturbing. Especially since many fund managers who claim to be ethical would be appearing to act in a completely irresponsible and unresponsive manner?

How on earth can only 11% of fund managers screen out child labour? Does that mean that the other 89% think its a good idea kids don't go to school and spend their formative years in sweat shops?

Why  do so called ethical fund managers refuse to respond to such surveys? What on earth do they have to hide?

What is going on? 2/3 of funds that claim to to ethical do not even engage with the companies they own?

Some of fund managers who performed badly (to be polite) are employed by pension funds that I am a trustee on. I will look forward to some interesting conversations in the future with them on this subject. 

Fair Pensions Living Wage Standards (& poverty pay Metropolitan)

Late yesterday I attended most of a briefing by Fair Pensions on their campaign to get a Living Wage for all employees and subcontractors of the FTSE 100.

Check out my twitter feed for 5 November for some of the stuff I found interesting.

Some key points from seminar: Fair Pensions CEO Catherine Howarth, that they had some form of contact with 50% of FTSE 100 companies and 11% are or will be Living Wage employers.

While Rhys Morgan, the Director of the Living Wage Foundation said that 80% of employers who pay a living wage found that quality of work was improved. I was glad that he also quoted Labour Leader Ed Miliband as saying that a Living wage was "important but not the summit of our ambitions". UNISON argues for a Living Wage "plus" - not just £8.30 per hour (as welcome as it is) but also decent sickness pay, pensions, annual leave as well as trade union recognition and collective bargaining.

I had to leave early for a Pension committee meeting.

It is also rather ironic that during the "Living Wage week" that UNISON is running a campaign against Metropolitan Housing Association, which claims to be a charity and responsible employer.  Yet it paid £412,000 to get rid of its former CEO, while at the same time planning to pay its care workers less than a living wage and employ part time staff on poverty rates, so their their wages will be topped up by the taxpayer. How completely disgusting and shameful.

If you work for Metropolitan or want to show solidarity sign the Petition here and read the comments by staff who in 2012 face being forced below the poverty line not above.  

AMNT newsletter October 2012 - meeting review; Fair Pensions invitation; Pensions Regulator message

- Download the reports presented at our last meeting
- Invitation from Fair Pensions during Living Wage Week
- Message to you from the Regulator

Dear member,

Last month’s AMNT members’ meeting was a success, with informative presentations and discussions on the thorny issue of investment management fees.

The meeting began with an overview of recent association activity from the co-chairs, Janice Turner and Barry Parr.


Barry explained how our efforts to sign up sponsors has been progressing well, with a couple of companies already signed up and a few more well on the way. We hope to provide you with full details of these when they are confirmed.

 



We then heard from Janice how the AMNT’s campaign to promote smoothing of DB discount rates was going well, with national press coverage and positive feedback from the pensions minister, Steve Webb.

 

There was then a presentation by Hari Mann of the RSA, who has worked with David Pitt-Watson on an influential report looking at the lack of transparency within investment management charges and how this can be damaging to pension savers.

 

The paper can be downloaded by clicking here, and the RSA’s other publications can be accessed by clicking here. Committee member John Gray’s review of Hari’s talk can be found by clicking here.

 

This was followed by a talk by John Simmonds of CEM Benchmarking. The company undertakes research into investment fees paid by pension schemes. His presentation can by found by clicking here.

 

CEM has offered AMNT members the chance to take part in their ongoing research. Schemes that take part will be entitled to a free personalised report. An example of such a report can be found by clicking here.

 



As an example of the type of information CEM would require, an example survey questionnaire can be found by clicking here. For more information on how to take part, contact John Simmonds by emailing johns@cembenchmarking.com.

Invitation from Fair Pensions

AMNT member Catherine Howarth, who is also chief executive of lobby group Fair Pensions, has sent the following invitation to members:

I would like to invite you to an event during Living Wage Week for pension trustees and other investors in FTSE 100 companies. The event, which is kindly hosted by Aviva Investors and in conjunction with the Living Wage Foundation, will mark 18 months since the launch of a collaborative investor initiative to promote Living Wage standards in the UK’s largest private companies.

The event will be an opportunity to hear from FTSE 100s that have become Living Wage employers as well as from a variety of investors who are supportive of the standards. It will be a chance to learn about the practicalities of implementation and about employer accreditation.

In May 2011, a £13bn coalition of institutional investors wrote jointly to the CEOs of the FTSE 100 inviting them to adopt Living Wage standards across their UK operations. Since then a productive dialogue between companies and their investors has developed on this topic, and a growing number of companies has either made progress towards Living Wage standards or has fully adopted and implemented them.

This event on November 5 will be part of Living Wage Week, which will see a range of events held across the country to celebrate the growing profile and uptake of Living Wage standards as a mark of organisational responsibility. The week begins on Monday morning with an announcement by Mayor Boris Johnson of the new London rate.

I very much hope that you will be able to join us. All members of the AMNT would be very welcome and it would be great to talk about whether you could notify people in the network. Please RSVP to Tom Scott (tom.scott@fairpensions.org.uk).

Pensions Regulator record-keeping message

We have also been contacted by the Pensions Regulator, who have written the following message for members:

In 2010, The Pensions Regulator set specific targets regarding ‘common data’ – such as name, address and date of birth – and gave trustees until the end of 2012 to achieve this.
 
The targets required that of these common data items:
 
- 100% should be in place for member data created after the beginning of June 2010
- 95% should be in place for member data created before June 2010.
 
By now, the regulator expects schemes to have taken significant steps to meet these targets. These steps include measuring their scheme data, and having a corrective plan in place where that data is found to be poor. Scheme administrators are ready to work with trustees on this, and failing to take action may lead to a breach of internal control requirements.
 
More information on record-keeping is available on the regulator’s website, including regulatory guidance, online learning resources and a new checklist for trustees.
 
To learn more about how poor data and record-keeping can impact schemes, join regulator staff in a 45-minute webinar at 11am on Tuesday October 16.
 
Regulatory case and policy leaders Victoria Holmes and Louise Hallard will discuss the risks of poor data as well as what action trustees should take now.  Places on the webinar are limited, so register now to reserve your place.
 
You can get on the regulator’s website by clicking here. You can also register for the webinar by clicking here.

Kind regards, AMNT Committee

Fair Pensions: Change the World from your Workplace

Its a pity but I won't be able to attend this Fair Pensions training day in November due to a clash. 

 

"Become a Workplace Responsible Investment Champion

TRAINING DAY: Saturday, 17^th November 2012 (10am - 4.30pm)
UNISON Centre, 130 Euston Road, London NW1 2AY

FairPensions is running a day-long training for people who want to use the power of their pension fund to campaign for social and environmental justice.

If you belong to a workplace pension scheme this training is open to you.

Pension funds have huge economic clout and can rapidly bring concerns to the attention of top decision-makers in the business world. Whether it’s low pay, child labour, excessive executive bonuses or climate change, our pension funds have the power and responsibility to challenge corporate injustice.

Your pension fund takes care of your long-term savings and that gives you the right to have your say.

At the training you will learn:

• How and where your pension fund invests your savings.
• How to communicate effectively with your pension provider about responsible investment.
• How to campaign on a wide range of environmental and social issues using shareholder activism as a powerful tool for change.
• How to build wider support for responsible investment amongst your colleagues and by your employer.

Trainees will leave the workshop with practical skills and tools for shareholder activism. You will also receive simple written materials and guides to responsible investment.

FairPensions is building a UK-wide network of Responsible Investment Champions. After the training you will join that growing network.

Learning about the power of the financial system will be invaluable for your wider campaigning goals and objectives.

If you care about ethics at work, join us on the 17^th November and become a champion for a better world!

We encourage you to come with a work colleague if possible, though you're welcome to come on your own! Please note that there is limited space for this event and we expect it to fill quickly.

RSVP to me at nataliedotlangfordatfairpensionsdotorgdotuk and make sure you include the name of your workplace.

We look forward to seeing you there.
All the best,
Natalie and the FairPensions team

P.S. Please forward this to anyone you know with a passion for change. 

AMNT newsletter – July 2012: meeting review; trustee guide discount

Association of Member Nominated Trustees

 Dear member,

Two weeks ago the AMNT hosted its summer members’ meeting with a number of topical discussions and presentations.

The event, which took place at AXA Investment Managers’ London offices in Newgate Street, began with a presentation by co-chairs Barry Parr and Janice Turner on the association’s latest developments.

Copies were distributed of AMNT’s recent submissions to the Dept for Work and Pensions inquiry into occupational pension schemes and to the Red Tape Challenge. We reflected the consensus of  all our meetings and called for DB trustees to be given the option of using smoothing when carrying out our triennial reviews.

DC trustees were updated on the discussions going on within the pensions industry, in which AMNT is participating, on development of a better type of DC scheme.

These included the finalisation of the constitution, an update on the AMNT’s lobbying activities and an insight into the potential sponsorship opportunities the association is in the process of finalising.

Then committee member Owen Walker gave a presentation on the development of the website.

This was followed by AMNT member and chief executive of FairPensions Catherine Howarth giving a presentation on the shareholder spring and how this affects trustees.

FairPensions has produced a briefing on executive pay, which has been designed with busy trustees in mind.

The idea is to make something available which gives trustees some handy questions they can ask fund managers if they want to be sure that a tough line is being taken on executive pay packages.

You can read it here: http://www.fairpensions.org.uk/sites/default/files/uploaded_files/investorresources/ExecutivePay2012.pdf

Members were then given a presentation by an AXA IM spokesperson on how investment companies can also help trustees to improve their shareholder engagement.

The meeting then split into breakout groups, focused on DB and DC issues.

The working group on defined benefit pensions concentrated on discussing a draft produced by DB working group chair John Gray on what to do if your scheme sponsor announces they want to close the scheme.

This draft is at an early stage and John Gray (john.gray@amnt.org) is very keen to hear from you if you have been through this process, regardless of whether the scheme closed or stayed open.

We are now revising the draft guide, carrying out further research and checking and we hope to circulate it to everyone in the near future. If you are interested in contributing to it please contact John.

After the break, members received a presentation by friend of the association and executive director of OPDU Jonathan Bull on the benefits trustees can receive of indemnity insurance.

Jonathan’s presentation can be downloaded by clicking here.

30% discount on trustee guide

The publishers of The Guide for Pension Trustees are offering AMNT members 30% off this publication which is on the reading list for the PMI trustees’ qualifications. The Guide is a practical and comprehensive manual for all pension trustees.

It contains the essential practical, legal and commercial information that trustees need in order to perform their roles efficiently, accurately and lawfully. You will receive free quarterly updates of the guide, reflecting the latest developments in the sector, and you will have free access to the guide online, which includes additional modules and data tables.

It normally costs £265 but the AMNT discount brings this down to £185.50, and all those taking up this offer will also receive a free copy of the Pensions Pocket Book 2012, which normally retails for £47.50. To obtain the discount you have to quote offer code GPTCW110 when you order. Telephone 01235 465 574, fax 01235 46556 or email subscriptions@marston.co.uk.

Ask your fellow MNTs to join us

The meeting was delighted to hear that AMNT has now grown to about 240 members, and we are responsible for pension funds with collective assets of an estimated £200-billion.

The more members we have the stronger our voice will be in putting forward your concerns to the industry, the regulators and the government, so if you could suggest to your fellow MNTs to join us that would really help.

Kind regards, AMNT Committee

(I posted this late so had to take out an invite to a conference that was out of date)

AMNT open meeting to members next Tuesday June 20

Association of Member Nominated Trustees. There is an open meeting of the AMNT next Tuesday 20 June at AXA Investment Managers’ London offices, 7 Newgate Street. London. Starting 1.30pm (sandwich lunch beforehand) and finishes 5.30pm (followed by drink and nibbles).

AMNT member and chief executive of Fair Pensions Catherine Howarth will give a presentation into the ‘Shareholder Spring’ and what it means for trustees.

Jonathan Bull of OPDU will also give a talk on the types of insurance available to trustees and what MNTs can to do to limit their own personal risk.

Followed by a report from the AMNT committee and breakout sessions on member concerns.

I have drafted a paper for the AMNT on "what to do if your employer wants to close your Defined Benefit Scheme". Which may be discussed either this meeting or the next. I'm at the UNISON conference next Tuesday so can't make it.

Find out more about the AMNT and join here. Email mail@amnt.org to apply if you want to attend.

WPP: Have your say on High Pay

(better late than never) "Dear John,

You might not have heard of WPP but you’ll have seen what they do. They are the world’s largest advertising group, producing adverts for companies like Nike, Heineken and Coca Cola.

On Wednesday, at its annual meeting of shareholders, WPP will put its CEO’s pay package to the vote. That pay package gives WPP CEO Sir Martin Sorrell:

• Total pay of £29 million
• A 60% pay rise
• An increase in his potential bonus from 300% to 500% of his salary

http://www.fairpensions.org.uk/highpay/wpp

In 48 hours FairPensions will be at WPP's meeting in Dublin*. It’s time to tell overpaying companies, starting with WPP, that enough is enough. We're asking supporters to add their names to a petition that we're going to present to the WPP board.

Sign the petition and we'll take your voice with us to the meeting in demanding WPP change their pay practices. 

http://www.fairpensions.org.uk/highpay/wpp

We want to send a clear message to WPP and other excessively paid FTSE 100 CEOs telling them that the days of spiralling executive pay are over. We've only got 48 hours until the WPP AGM so please do share this action with friends and colleagues.

Thanks for your support

Matthew, FairPensions

*WPP moved to Dublin in 2008 to take advantage of lower corporation tax rates than in the UK. For more information on WPP and why we're targeting them click here: http://www.fairpensions.org.uk/highpay/wpp/info "

Tired of Banker’s Bonuses? It’s about time we all Have Our Say on High Pay!

"Over the past decade, while executive pay has grown by over 323%, the average UK earnings have grown by a mere 54%. Across the nation, ordinary workers have felt outraged by the continuing gap between the lowest and the highest paid earners but felt powerless to do anything. This growing inequality is particularly distasteful considering the current economic situation, with high unemployment and pension cuts creating hardship for many.

But how can we tackle this culture of excess? Vince Cable thinks that it is up to the shareholders of companies to hold the boardroom to account. However, despite the vast increases in bonuses and single performance incentives, not to mention “Golden Hellos” (a hefty sum paid to attract talent to the company), average levels of shareholder dissent have been stuck at around 9%, with outright defeat for these pay packages at annual general meetings remaining a rare spectacle.

We all have the power to influence these shareholders, who are mainly compromised of institutional investors. These anonymous ‘institutions’ are, among others, the pension funds and insurance companies who look after our retirement savings. In other words, the owners of corporate Britain are no longer a few rich individuals: they include anyone with pension savings, or around 11 million of us. This is our money!

The responsible investment charity FairPensions has launched ‘Your Say on HighPay’ at www.fairpensions.org.uk/highpay This online action tool will email your pension fund or ISA provider telling them you want them to vote against excessive pay – and asking them to let you know about it. 

Whether the ‘Shareholder Spring’ proves to be a one-season wonder or something more permanent may yet be up to us". (Great guest post by MM).

Executive Remuneration – free seminar for pension fund trustees

Executive Remuneration – free seminar for pension fund trustees

Co-hosted by the TUC and Fair Pensions 2.00 – 3.30pm, Monday 21 May, Congress House with speakers:

Frances O’Grady, TUC Deputy General Secretary

Iain Richards, Head of Governance and Responsible Investment, Threadneedle Investments

Catherine Howarth, Chief Executive, Fair Pensions

Are current levels and rates of increase of executive remuneration fair and transparent? Are fund managers reflecting the views of beneficiaries in their engagement with companies on executive pay? What can pension fund trustees do to bring about improved practice in the area of executive remuneration?

You are invited to discuss these and other questions at a free seminar for pension fund trustees hosted by the TUC and Fair Pensions taking place from 2pm – 3.30pm on Monday 21st May, in Congress House, Great Russell Street, London WC1B 3LS.

 

Fair Pensions has produced a briefing for trustees on executive remuneration, which can be found at http://www.fairpensions.org.uk/sites/default/files/uploaded_files/investorresources/ExecutivePay2012.pdf

To register for the seminar, please e-mail trusteenetwork@tuc.org.uk

Shareholder Spring: Employee reps to stop crony capitalism

I was astonished to read in today's Evening Standard (of all papers) that its City Editor, James Ashton, supported as the only "surefire way for any board to keep in touch with reality" over executive pay, is to appoint employee representatives to the

board "to keep them honest".

The background to this is the revolts by shareholders (or rather asset managers not by and large the actual share owners) at Company Annual General Meetings (AGM) over excessive and unearned top executive pay. Yesterday the boss of insurance giant Aviva was forced to resign after his pay package was rejected at its AGM. So were the bosses of drugs giant AstraZeneca and Trinty Mirror. Tomorrow apparently the British Gas Centrica CEO is also in big trouble.

At a pension conference recently on executive pay I asked Government Cabinet minster Vince Cable why it was thought a good thing that employee representatives were legally required to make up to 50% of the trustee board of a company pension fund, making decisions that could make or break the organisation, yet there was no requirement to have even one such rep on the same company remuneration committee? He claimed to support the principle of employee reps but that the role of a pension trustee was very different to being on a company remuneration committee (which is completely rubbish not least since many employer reps on pension schemes also sit on you know what committees!)

I must admit to agreeing with James Ashton's conclusion that the employee representation "model has been proved to work elsewhere in Europe. What better way for the chairman to keep in touch with the shopfloor than to have the shopfloor turn up in his boardroom once a month? It could make for some uncomfortable meetings".

Update: I'll post on the campaign by Fair Pensions on how ordinary people can take action against executive High Pay soon.

The Enlightened Shareholder

Last week I went to the launch at the House of Commons of the report "The Enlightened Shareholder: Clarifying investors'

fiduciary duties" by Fair Pensions.

The speakers included "Professor John Kay, who is currently leading a review which looks into long-termism in the UK equities market; Saker Nusseibah, Acting CEO of Hermes; Roger Urwin, Global Head of Investment Content at Towers Watson and Baroness Jeannie Drake".  Fair Pensions CEO, Catherine Howarth, chaired the meeting and its author, Christine Berry presented the report.

The big issue is whether or not the "fiduciary duty" of shareholder representatives (and trustees) ought to be legally redefined to deal with "crony capitalism and excessive executive pay". Pension trustees (and member nominated representatives) still come across advisers who tell them (completely wrongly I think) that  their only role is to "maximise returns" of the scheme regardless of the impact it has on stakeholders, the wider economy and even the long term interests of the scheme. Which is clearly stupid and frankly bonkers. But it happens and it needs to be dealt with.

I think this problem is widely recognised but there is the usual dispute about the solution. Should this be by statutory regulation or some sort of a voluntary code? As pointed out in the debate we have tried the voluntary approach for a long, long time. It has clearly failed due to agent self interests and conflicts. We need to regulate.

Sleeping with the enemy: Ken's offer to Vince about bringing down the Coalition

Today there was a London Labour Party Manifesto meeting at Congress House.  I missed the morning session due to my Council surgery and a Fair Pensions Training on shareholder Activism (which I had to leave early). 

Ken gave a keynote speech to the meeting after lunch and was on form.   He compared the 77% of funding that Boris received during the last Mayor campaign from City Bankers and Hedge fund managers with the 80% he received from trade unions and trade union members. Unlike Boris he was proud of his funding.

Boris is planning to increase fares by 2% above inflation for the next 20 years. If he is elected Ken has pledged to cut tube fares by 7% and bus fares by 11%.

On Housing issues Ken spoke passionately about a London Living rent and a GLA rental agency. He also reaffirmed his commitment to work with London Council (and the LPFA which the Mayor runs) pension funds  to get them to fund investment in Housing. I will of course declare an interest in this subject. I also have never understood why British pension funds do not invest in residential rental properties?

Ken being Ken had to say something to bring a smile to our faces. His despair at this present Coalition government and his wish for it to fall led to him making a typically "Ken" offer to even sleep with Vince Cable if this meant the government would "fold".  An offer that Vince will no doubt....

"Can pension funds shape the future of capitalism?"

Catching up on things. Last month I went straight from the TUC Trustee Pension Conference to the Fair Pension's Guest Lecture at the House of Commons. This was the second presentation I had been to that day on "Capitalism and pensions". I was with a notoriously quiet and reserved UNISON colleague who is a Local Government Pension (LGPS) expert. The lecture was given by Professor Keith Ambachtsheer, Director of the Rotman Institute for Pension Management (left of picture).

He was introduced by John Cruddas MP who is the Chair of the All Party Parliamentary Committee for Responsible Investment. The meeting was Chaired by Catherine Howarth of Fair Pensions.

You can read an account of his speech (and that of Mark Fawcett, Chief Investment Officer at NEST - right of picture) and the full text here. My take on Ambachtsheer is that he believes that Capitalism must be transformed by those who invest in pensions acting as active owners and demanding that capitalism is transformed into a sustainable and wealth creating model. Rather than mainly benefiting "agents" and being subject to their whims.

What I also found striking in his speech was that the traditional argument over pensions about which is best: Defined Benefit or Defined Contribution? Is the wrong question to ask. Instead you should be more concerned with Scale (size of fund), Governance, Investment belief and Fees.  I asked a question about the Local Government Pensions Scheme (LGPS) which has around £140 billion in assets but is split into 101 different funds. Ambachtsheer thought this was just completely wrong to have so many small funds.

Afterwards we went to the St Stephens Tavern where we had some very "interesting" conversations about the future of the LGPS from across the political divide.

TUC Trustee Conference 2011: Fiduciary Duty for Trustees

This is from last weeks TUC Member Trustee Network Annual Conference at Congress House.  I missed the morning session due to regional meetings.  Which was a shame.  Especially the

Steve Webb MP (Minster for Pensions) keynote address.

I came in during the end of the panel discussion on "Fiduciary duty for Trustees". Which in the exciting world of pensions is a "hot topic". It use to be the case that Pension Trustees were told that they could not consider any other investment issues except maximising financial returns. This has recently been turned on its head.

As panel member,Thompson's solicitor Ivan Walker put it, there could be a breach of your duties as a trustee if you do NOT consider environment, social and governance (ESG) issues. Will Oulton from Mercer pointed out how many companies boast about their Corporate ESG activities yet when you ask them about their company pension fund ESG you get blank looks.

Christine Berry from Fair Pensions asked trade union pension trustees to reclaim their funds from outdated dogma which suits the interests of the financial services industry. I'll post further on the conference when I can.

Vote YES in Public Service Pension Strike Ballot: Fair Pensions for all

Dear Members

Vote YES in Public Service Pension Strike Ballot
Look out for the ballot papers in your post during the next few days asking you to vote for industrial action.

We are asking you to vote YES since the proposed changes are just not fair.

The pensions dispute affects thousands of UNISON members in community and voluntary organisations. This is about your future, about the sort of life you want when you stop working.

Hundreds of employers outside the public sector participate in the Local Government and NHS pension schemes – so that employees transferring into them from the public sector can remain in the schemes.

As a result, thousands of UNISON Community service group members are affected by the changes to public sector pensions that are being proposed by ministers. The proposals will mean those members will pay more for their pension, if they earn more than £15,000 a year. Most of them will work much longer. And changes already imposed mean their pension is already worth less and they will receive less when they retire. 

Not a penny of this major increase in contributions will go towards improving the pension scheme. Instead it will go to the Treasury to pay for the excesses of the bankers. 

The proposed changes will harm Community UNISON members just as much as those in the public sector, and we say enough is enough. 

UNISON is therefore balloting thousands of members in community and voluntary organisations and housing associations, so that they too can have their say. (It may be that some members who are not in a relevant pension scheme have been included in the ballot. This is ok – not every member within any employer has to be affected for all members within that employer to be balloted on that issue.)

Vote YES, and make it clear to ministers that what they are proposing is unacceptable. 

Yours faithfully

John Gray

Branch Secretary 

Just Pay: Fair Pensions (and the bleeding obvious)

 I missed the launch of the "Just Pay: Living Wage Campaign" by Fair Pensions last Monday. I hope it goes well.  What a fantastic campaign.  It calls on all the UK FT 100 companies to agree to being a Living Wage

employer.

Check out Tom who points out that 3.5 million workers in the UK earn less than £7 per hour and 53% of kids who live in poverty have a parent in work.  A coalition of investors with assets under management in excess of £13 Bn will contact the CEOs of FTSE 100 companies calling for the application of Living Wage standards across all UK operations. The campaign is also asking small shareholders, policy holders and customers of these companies to take part in the campaign. 

Personally, I do not understand how the senior executives of these companies who earn huge, and often staggering amounts of money each year can enjoy their dosh when significant numbers of the people they employ have to support their families on poverty wages.  Apart from the moral argument over poverty pay I found this "bleeding obvious" comment below compelling.

"We've found that paying the Living Wage is a smart business move as increasing wages has reduced staff turnover and absenteeism, whilst productivity and professionalism have subsequently increased." - Guy Stallard - Director of Facilities, KPMG Europe.

'Protecting Our Best Interests: Rediscovering Fiduciary Obligation'

On Wednesday evening I went to the launch of the latest report by "Fair Pensions" the respected campaigning organisation for "responsible investment". 

"New research by Fair Pensions calls for an ‘enlightened fiduciary' model for institutional investors to parallel the new duties of company directors introduced in 2006. The report argues that such a provision would provide a valuable ‘nudge' towards sustainable, long term investment to overcome narrow interpretations of fiduciary obligation which emphasise profit maximisation at the exclusion of all other factors, including financial system stability".

Lib Dem Government Minister for "Employment Relations, Consumer and Postal Affairs" Ed Davey gave a positive but guarded welcome to the report. 

Hermes fund manager, David Pitt-Watson was also one of the speakers and gave his usual demolition job (how going dutch can double the value of the average Brit personal pension) on most private pension schemes.

He also pointed out that pension "trustees" came about historically to prevent pensioners from being ripped off and still perform this role.  I made a comment about this and the anomaly that if trustees are seen as a "good thing", why are there huge penison funds run by insurance and investment companies where there is no such representation to look after the interests of beneficiaries?

Another 2010 Christmas Carol

Carol is a single mum with three small children who works in the kitchen of the Executive dining room of a British FT100 listed company in East London. She earns £13,000 per year for an average 40 hour week (the national minimum wage of £5.93 per hour is £12,334). She prepares food and cleans the dishes of people who earn up to 100 times what she is paid. She does not work directly for the company but is employed by a subcontractor on rolling 3 month temporary contracts.

Since her wages are so low she receives working tax credits from the government to supplement her income. She also has housing benefit to help her pay the rent and Council tax benefit at her two bed Council flat. Her children receive free school meals. All of this desperately needed support is paid for by the British taxpayer.

She of course does not receive any company pension or any sick pay. Despite the state benefits Carol and her children live hand-to-mouth and she has to rely on moneylenders to pay for emergencies as well as her children’s birthday and Christmas presents.

It is already pretty well known that the marginal rate of tax for the very low paid is far less than the extremely well paid executives that Carol serves and cleans up after.

But what is less well known that both the company who employs her and the FT100 Company she works at also outsources its revenue and profits abroad and pays the British Government relatively little in taxes.

Therefore the financial supplement to Carol’s meagre wages is being paid for by British taxpayers yet both companies who benefit from paying her poverty wages are avoiding paying taxes to the British government. Double bubble exploitation?

Why should British taxpayers subsidise miserable pay and conditions while at the very same time letting these same Scrooge employers avoid paying their fair share of British taxes. Surely this is not right?

Remember before feeling too outraged and smug that you probably have pension and insurance funds that invest in both these companies and make money out of them. Your future pension could be financed by other people’s personal misery.

Hat tip Fair Pensions. Watch out for their next campaign on a Living Wage for all top FT100 employees and their contractors. 

Check above Picture and the other Christmas Carol

Capital Stewardship: UNISON London Pension Network

Next Tuesday lunchtime is the latest UNISON Capital Stewardship: London Pension network meeting. 

This is a meeting for  Greater London UNISON Pension trustees or member nominated representatives on the London Local Government Pension Schemes.

All such trustees and reps welcome!

We meet up 3 or 4 times a year to discuss issues and support each
other on what is often a very demanding, responsible and "head hurting" role.

Our Guest speaker this time will be from Fair Pensions who will be presenting on their new campaign “Tackling exploitative Pay and working conditions in the  Supply chain of the UK Largest Companies”.  Which I think will be more than interesting and relevant to trade union pension activists. 

I am just a little bit behind posting on Pension issues.  I have got reports on the latest LAPFF meeting, my last London Borough Tower Hamlets Pension scheme panel (and committee) as well as last week's really excellent annual TUC Pension Trustee event.  I must catch up.