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Richard butcherss

  1. 1. Is Fiduciary Management Beneficial - and is Today’s Pensions System Sustainable? Interview by Helen Winsor, Finance IQRichard Butcher, Managing Director, Pitmans Trustees, discusses the implications of the flat- rate state pension, auto-enrolment, the state of DB and DC schemes and whether fiduciary management is indeed a good thing.Finance IQ: Hello and welcome to this IQPC podcast presented by Finance IQ in conjunctionwith the 2nd Annual Fiduciary Management Summit due to take place in April in London. I’myour host, Helen Winsor, and today I’m joined by Richard Butcher. Richard is the ManagingDirector for Pitmans Trustees. One of his colleagues, Melanie Cusack, will be speaking at ourevent. Richard, welcome to the show today; how are you?R Butcher: I’m well, thank you very much.Finance IQ: Thanks very much for joining us. Now, I’ve got several questions for you today.First of all, what do you make of Steve Webb’s announcement on flat-rate state pensionschemes; that people will now have to make 35 years worth of National Insurancecontributions to be eligible? What will happen to people who can’t actually do this?R Butcher: Let’s deal with the last bit of that first because it’s fairly straightforward. Ifsomebody can’t complete 35 years worth of service, they’ll have a pro rata amount. If theycomplete 30 years, they’ll get 30/35ths of the full flat-rate state pension. That’s a system thatwe’ve adopted for a great many years on the basic state pension, so it’s well accepted.What do I make of the announcement? Personally, I think that the flat-rate state pension is avast improvement on what we had before. The system before this, the current system, isincredibly complex, phenomenally complex, frighteningly complex, and complexity has twodisadvantages. One is that it costs an awful lot of money to administer. That money will besaved, and that’s money in the private sector as well as in the public sector.And secondly, complexity bamboozles the public. They’ve absolutely no idea what level ofstate pension they’re going to get, so it’s very difficult for them to plan what level of privatepension provision they need to top it up to an adequate retirement income. With the claritythat the flat-rate state pension will bring will allow people to meaningfully plan. They’ll be ableto see quite clearly what the state will pay them and then it’s up to them to decide how muchthey save towards an adequate retirement income.Finance IQ: Thank you. So that’s really great to sum that up. We are now nearly six monthsinto auto-enrolment – another system. What do you think are public perceptions of it and doyou think it’s sustainable?Richard’s colleague, Melanie Cusack, Director of Pitmans Trustees, will be speaking at ourFiduciary Management Summit in April. The event is due to take place in London on 30 thApril. For information, call 0207 368 9300, alternatively the full interview here: 1
  2. 2. IQPCPlease note that we do all we can to ensure accuracy within the translation to word of audio interviews but that errors may stillunderstandably occur in some cases. If you believe that a serious inaccuracy has been made within the text, please contact +44(0) 207 368 9425 or email 2