A day in the life of...Christine Farnish

Trust is the key, says the woman who lives and breathes pensions
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The Independent Online

With a week to go until the deadline for submissions for the Government's forthcoming White Paper on pension reform, Christine Farnish's morning flick through the daily newspapers is taking longer and longer. Today, she finds the Financial Times is running with comments she made earlier in the week, criticising Lord Turner's proposals for a centralised National Pension Savings Scheme (NPSS) as a "throwback to the Stalinist era". The Times and The Independent are also running their latest take on the fast-changing pensions industry.

After a quick jog round two central London parks, and a brief catch-up on the rest of the day's news with the help of BBC Radio 4's Today programme, Ms Farnish sets out on her walk to work - all 200 yards of it.

From her pad in London's Victoria Street, she can even see her offices, making her the envy of the City's commuting masses. At the weekends, however, she escapes to Hove in East Sussex, where she and her husband have their second home.


The first of a full day of meetings kicks off - this morning with Stephen Haddrill, her opposite number at the Association of British Insurers (ABI). Once again, the NPSS is top of the agenda, with the two parties clashing on the reality of meeting Lord Turner's challenge of running a pension scheme for just 0.3 per cent a year.

Given that the insurers baulked six years ago when they were asked to provide stakeholder pensions for less than 1 per cent, the ABI is more than a little sceptical about the possibility of managing and administering a new package pension for only 0.3 per cent.

However, Ms Farnish and the National Association of Pension Funds (NAPF) believe that if the Government goes for its plan of creating a handful of "supertrusts" - large, not-for-profit investment trust-style vehicles, which will pool the defined contribution schemes of hundreds of companies - Lord Turner's target may not be unreachable.

"We think it would be a much better way forward in the UK if we could build on what we've already got. Supertrusts would work on the side of the consumer because employers would have choice. But one of our reservations about the NPSS is that it would be a single, all-powerful organisation - there would be no choice."

Although the morning meeting with the ABI does not end in complete consensus, the two sides hope their different models will provide the Government with some choice when deciding how to implement the NPSS. At the very least, they hope they will persuade it to leave the administration of the scheme to the professionals, and resist the temptation to create a new "monolithic quango", in Ms Farnish's words.


It's back to the office to oversee a series of member forums, giving pension funds the chance to get advice and help on the mounting burden of pensions regulation which has sprung up over the past year.

Today, Ms Farnish is addressing concerns about the new Pensions Protection Fund levy, which threatens to deliver a hefty blow to many schemes. "The levy has turned out to be twice what we thought it was going to be, and there are some companies which are very well funded, and yet which are still going to have to pay quite large levies.

"I understand the money has to come from somewhere, but if you put too much of a burden on smaller firms and schemes, you may push them over the edge. So it's all a balancing act."


Like most days, lunch is done over a meeting. Today's is at the headquarters of JP Morgan to discuss arrangements for an annual pensions conference, set to take place in Scotland in September. With the doors shut to the media, the conference brings together all the industry's most important figures, including ministers and senior civil servants. Chatham House rules helpcreate a less formal and uninhibited environment, which has helped make the conference one of the key dates in the pension industry's diary.

This year's agenda looks set to include a look at how the new pensions regulations are working, an examination of the Government's White Paper, and also the effects of the PPF on the industry.


From the City, it's back to Westminster after lunch, but not to the office. This time, it's to the Department of Work and Pensions, where Ms Farnish is meeting John Hutton, the Secretary of State of State for Work and Pensions, and Stephen Timms, the Pensions Reform minister, to convince them of the merits of the NAPF's supertrust plan.

Sceptics have suggested the Government will never commit to Lord Turner's NPSS - whether run by the private or public sector - because of the additional bill for tax relief which it will be landed with once the entire country is auto-enrolled into the scheme. However, Ms Farnish says the ministers appear genuinely open-minded and committed to delivering a sustainable new British pensions system.

"I think they've got a very open mind - they're genuinely engaging in this debate. Everyone knows by now that we either have to work longer, pay more taxes, save more or receive less in retirement. I'm sure there's no one in Government that believes we can just muddle through. And I don't believe the public would be too impressed at the next election if the Government just sits back and doesn't do anything."


Between meetings, Ms Farnish has time to take calls from the press and members of the NAPF. Having just submitted the NAPF's response to the Pension Regulator's new rules on scheme funding, this continues to feature on the list of today's hot topics.

Although the NAPF has been relatively supportive of the Pension Regulator's attitude to how companies should deal with their pension deficits, Ms Farnish concedes she is concerned by the wording of the legislation on which it must base its final rules. "The letter of the law says schemes should have sufficient and appropriate assets to meet technical provisions at all times. Although I think David Norgrove [the Pensions Regulator chairman] wants to be flexible and pragmatic, the law is not helping."

The industry must now wait several weeks to see how Mr Norgrove steers through this minefield. But Ms Farnish remains acutely aware that if a balance is not struck, many companies who have no risk of going bust will be forced to plug their pension fund deficits more quickly than they would like. This, she points out, will only prevent money being spent in other areas, and may ultimately detract from the performance of otherwise successful organisations.


Over to the Treasury to deliver yet more briefings on the NAPF's supertrust proposals. Again, the mood appears to be positive, but it's still early days.


For the evening, it's off to the leaving party of Sir Bryan Nicholson, the chairman of the Financial Reporting Council who is stepping down after four and a half years in the job.

This is just one of four evening engagements Ms Farnish has in the diary for the week, and on the nights that she's lucky enough to get home, work travels with her. More discussion of changes to the pensions regulations, the PPF, and where the Government might be heading with its White Paper ensue, before she finally escapes sometime after 9pm.