Rosalind Altmann CBE (born 1956) is a leading independent UK pensions expert and campaigner.
She led a long campaign on behalf of 150,000 workers and their families whose company pensions disappeared when their employer's final salary scheme failed. Having been assured their pensions were safe and protected by law, these workers from companies such as Allied Steel and Wire, Dexion and UEF suddenly faced losing their whole life savings and her work contributed to establishing the Pension Protection Fund and the Financial Assistance Scheme. She has also supported the campaign for people whose pensions were placed in peril by Equitable Life. More recently she campaigned against the sudden, short notice increases in women's state pension age, achieving success in reducing the planned rises, and was instrumental in highlighting the injustices of the annuities market, which culminated in the Government's announcement of the end to quasi-mandatory annuitisation of pensions. Although best known for her pensions work,she is also involved in economic analysis and most recently in highlighting the inadequacies of the social care system. She is also a familiar figure on UK TV and radio, speaks both nationally and internationally on pensions policy, retirement and investment issues and has written for most major newspapers on a range of financial and economic issues, and has twice been the recipient of the Pensions Personality of the Year Award. She is a governor and non-executive director of the London School of Economics. and also an advisor to the International Longevity Centre – UK She was appointed as Director General of The Saga Group in October 2010 where she stayed until February 2013. In 2011 her work as the "leading commentator on pensions and other matters affecting the lives of the nation's over 50s" was recognised when she was presented with the Public Affairs Achiever of the Year award. She was appointed Commander of the Order of the British Empire (CBE) in the 2014 Birthday Honours for services to pensioners and pension provision.
Altmann attended the Henrietta Barnett School winning the Dame Henrietta Barnett memorial prize for sixth form achievements. She was awarded a first class honours degree from the University of London and a Kennedy Scholarship to Harvard University where she worked with prominent economists including Mervyn King and Larry Summers. She received a PhD from the London School of Economics for research into pension income and later life poverty.
A senior investment management role at Chase Manhattan, running the Bank's international equity department in London, was followed by directorships at Rothschild International Asset Management and NatWest. Her work included advising on strategy for UK pension funds and funds established under the US ERISA rules, plus advice to central banks. A full-time job gave her insufficient time with her young family so in 1993 she became an independent investment consultant with clients including 3i group, BT, HM Treasury, Standard Life, the BBC, Sky and Channel 4.
In July 2004 Altmann was appointed by Lord Falconer, Lord Chancellor, to the Strategic Investment Board for a three-year term. The announcement cited Altmann's work on the Myners' review and her then current job as non-executive policy adviser to the Policy Unit at 10 Downing Street on investment, pensions, savings and annuity policies".
Pensions theft campaign
The campaign which "propelled her into the media spotlight" began in July 2002 when Allied Steel and Wire, part of the former UK nationalised steel industry with plant in Sheerness and Cardiff went into receivership. Although their pension scheme was "fully funded" according to the prescribed UK government Minimum funding requirement formula, this level of funding was only sufficient to pay those already retired. The existing workforce, many of whom had very long service and were close to retirement, faced losing their entire pension, including their so-called Guaranteed Minimum Pension, which was introduced by the Government to replace some of their state pension entitlement, but which turned out to be neither guaranteed nor a minimum. The BBC Panorama program asked Altmann to go to Cardiff to explain to the workers what had happened to their pensions. Altmann was the obvious choice. "She has vast experience in the field, having managed institutional investment portfolios for 15 years, including pension funds, insurance funds and unit trusts." Believing that once the facts were established, the government would recognise its mistake and provide rapid compensation, Altmann set up the Pensionstheft Action Group encouraging members to lobby their MPs for compensation and write to local newspapers. She used her political and press contacts to ensure PAG appeared regularly in news bulletins and newspapers and devised the banner "Stripped of our pensions". She produced research papers, background briefings and media articles and gave numerous speeches calling for compensation.
In 2004, threatened by a back bench rebellion, the government set up the Pension Protection Fund to help schemes which failed in future. It also offered limited retrospective compensation via a Financial Assistance Scheme, but only for those within three years of retirement and only for a small fraction of their pension while the majority of those affected would get nothing. This attempt to stave off political opposition did not address the injustices so Altmann helped the victims put together appeals via their MPs to the Parliamentary Ombudsman, Ann Abraham, who selected four representative complaints and launched a detailed investigation into the role of Government in these pension losses. In March 2006, Abraham, published a report "Trusting in the pension promise" which found official information "inaccurate, incomplete, unclear and inconsistent". She recommended the government consider offering compensation for lost pensions and the suffering and distress caused. It was immediately rejected by Tony Blair.
In accordance with Parliamentary procedure when the Ombudsman's recommendations are rejected, the Public Administration Select Committee examined the evidence. In July 2006 they published a report broadly agreeing with her conclusions. It was also rejected and Altmann took their case to solicitors Bindman & Partners. With Altmann's help, John Halford of Bindman's and barristers, Dinah Rose QC and Tom Hickman from Blackstone Chambers, agreed to work on a no win no fee basis, and prepared a Judicial Review. In February 2007 a High Court judge, Mr Justice Bean, found for the pensioners. He ruled that rejection of the Ombudsman's report was unlawful and irrational, and described the reasons for the omissions in the DWP leaflets as "minute textual analysis" of a kind that: “can in my view only give comfort to those who consider that it is unwise to believe anything one reads in a government publication. It is particularly ironic when applied to a leaflet whose back cover boasts that it has been awarded a Crystal Mark for clarity by the Plain English Campaign. PEC 3, especially page 15, gives the clear impression that following the enactment of the new law scheme members can be reassured that their pensions are safe whatever happens. I have no doubt that this is what it was designed to do. I agree with the Ombudsman that it was inaccurate and misleading.” The government appealed, and the case was heard by three Appeal Court judges in late July 2007.
Meanwhile, in the March 2007 budget the Chancellor of the Exchequer announced additional funding for the Financial Assistance Scheme and a review to be carried out by Andrew Young to find the most efficient method of using existing scheme funds and any other appropriate finance. This reported in December 2007 after a delay but it eventually led to an announcement from Secretary of State Peter Hain and Pensions Minister Mike O'Brien of an increased level of assistance which most commentators (and the Parliamentary Ombudsman) considered to be fair as it was on a par with the Pension Protection Fund.
In February 2008, much later than expected, the Appeal Court delivered its verdict: the government was once again found guilty of misleading the pensioners and the constitutional position of the ombudsman was clarified. The government can reject the PO findings but must provide "cogent reasons" for doing so to Parliament, a simple difference of opinion would not suffice. The government announced it was considering appealing directly to the House of Lords, but in March 2008 it decided to accept the Appeal Court verdict. The campaign had taken over 5 years of continuous effort for which Altmann received no payment. Writing in The Herald, following Altmann's CBE award, Simon Bain explained in summary that a total of 165,000 members and 1050 schemes were affected with payments by mid 2014 of just under £500m.
Equitable Life campaign
Altmann has also supported the 1,500,000 the Equitable Life policy holders in their fight for compensation following pension losses blamed on inadequate government regulation of the company. Newspapers began questioning the adequacy of the company's reserves in 1998 but the "Equitable Life scandal" became major news in 2000 when the House of Lords decided that the company had to honour its Guaranteed Annuity Rate promises. In 2001, close to collapse and now facing an additional £1.5bn shortfall met by raiding the with-profits fund, it put itself up for sale and stopped taking new business.
The Penrose report, commissioned by the Treasury in 2001, was finally published in 2004 after delays due to vetting by Treasury lawyers.
The report said that for a decade the company had promised its policy holders more than it could deliver. The Government Actuary department had failed to understand Equitable's returns throughout the 1990s and there was a lack of co-ordination between the DTI and the Securities and Investment Board. However Penrose deemed the regulatory failures were secondary and the public expected too much of the regulators. The European Parliament also said the government had failed to regulate Equitable Life.
In July 2008 the Parliamentary Ombudsman published her report after a four-year investigation. Altmann questioned "whether the holes in our regulatory regime are due to a system driven too much by the interests of the industries being regulated, rather than the ordinary people who need to be protected". She also expressed her "fear that the Government could try to resist any calls for Equitable Life compensation in the same way that it continuously refused to properly remedy the occupational pensions scandal over the last 10 years".
The Ombudsman's report had been due at the end of 2005. Altmann, blaming delays on the investigated departments accused the government of deliberately acting slowly, and called for prompt compensation. In January 2009 the government announced "a paltry compensation scheme" to be paid to those "disproportionately affected" as determined in a report to be produced by Sir John Chadwick.
In May 2009, as the Parliamentary Ombudsman issued a "special report on unremedied injustice", Altmann asked "What is the point of Parliament appointing an independent adjudicator if ministers can simply keep on ignoring her decisions?" In July 2009, as Equitable Life victims threatened legal action naming the DTI, the Government Actuary Department and the FSA, Altmann again urged the government to pay up promptly.
In 2011, the Coalition Government finally established a compensation scheme which started paying victims some compensation during 2012/2013, however an estimated 30,000 of the policyholders died without compensation.
Altmann campaigned for many years for reform of the annuities market, in particular the sales process which failed to ensure customers understood the risks of annuity purchase, even though it was irreversible, and did not help them find the right type of annuity. Annuities were sold with no suitability checks whatsoever and no controls on the value for money or charges for captive customers compelled by law to purchase an annuity if they needed income from their pension fund and did not have substantial sums. She called for change as long ago as 2001. As the Bank of England pursued its ultra-low interest rate policy and quantitative easing, Altmann continually highlighted the problems this caused to savers in general and pensions and annuities in particular. Altmann described the December 2013 Financial Services Consumer Panel (FSCP) report on Annuities as the "most damning indictment" of the annuity market she had seen. She added "It is failing a generation of pensioners. I have been calling for years for this to happen and I can only pray that now, regulators will be shamed into taking the action so badly needed in one of the last areas of financial services where rip off charges are still condoned."
In her report "Pensions – Time for change" in October 2013, Altmann warned that the Act -under which employers started automatic enrolment in October 2012 -could expose workers to "risky, hard-to-understand and outdated retirement saving schemes." Workers with a defined benefit (DB) scheme were obliged to choose an annuity on retirement and "the risk of buying at the wrong time, choosing the wrong annuity or failing to find the right rate could increase the number of poorer pensioners by many millions." She said that the Government's reforms "require people "to be able to cope with risks that they do not really understand." Her views were followed the next day by a call from Prince Charles for a pensions industry 'fit for 21st Century' The UK budget of March 2014 addressed many of the criticisms, and journalist Rebecca Burn-Callander discussing her CBE award highlighted her contribution to avoiding exploitation of annuities.
Views on coalition pension reforms
Altmann has criticised changes to inflation protection on state pensions. In 2010 the coalition changed the basis from retail prices index (RPI) to the historically lower Consumer Prices Index (CPI) but introduced the "triple lock guarantee." This fixes the pension increase for the following April at the higher of either price or wage inflation if either exceeds 2.5%. Despite this triggering a 2.7% rise for 2014, Altmann pointed out that RPI had risen by around 3% so the old measure would have still been more beneficial. She successfully campaigned for change to the planned extra increases in women's state pension age, resulting in a reduction in a six-month the maximum rise. More recently, however, she has been broadly supportive of the reforms to end mass means-testing of pensioners and the single tier state pension, albeit expressing reservations about leaving out existing pensioners, the impact on the lowest earners and the removal of inflation-linking for GMPs. She has been particularly supportive of the reforms for increased freedom and flexibility in Defined Contribution pensions.
Altmann was an outspoken critic of quantitative easing and has warned of the dangers of interfering with the risk-free interest rate that underpins all financial asset prices. She was also an advocate of slow rises in interest rates as she could see the UK economy had started to grow strongly, well before others recognised this. She has also highlighted the distributional consequences of the Bank of England's policies, which she believes have redistributed national income and wealth away from the young, the old and the north of the country towards the wealthiest members of society, the south and those with the largest mortgages.
Altmann is married with three children, Steven, Lisa and Emma and lives in north London.
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