Instead of zooming up and down motorways, we’re Zooming with clients, networks, friends and families. Has this made us more productive, or left us with a feeling of isolation? How many businesses will return to the old ways, where ‘I’m working from home today’ was code for ‘I’ve got a delivery due’ or ‘my childcare arrangements have gone haywire’? Will I ever wear a suit again?
But the pandemic isn’t the only force bringing about a paradigm shift. Brexit almost seems like yesterday’s news, but has barely started. Businesses are still unclear as to how they should prepare for the ‘new normal’ following the end of the transition period. Maybe the apparent reign of terror in No. 10 will come to an end with the departure of certain special advisors. Will this help normal relationships to resume between the Government, MPs and the Civil Service, and bring about a return to the norm of a (relatively) collaborative, consensual government?
One aspect that will take a considerable amount of time to return to normal is the state of public finances. The expenditure to tackle the crisis has been mind-boggling. It would be a shame, however, to waste a good crisis. Signs that the government won’t return to their old habit of trying to balance the books by reducing welfare payments are encouraging. For pension schemes, the recently announced ‘green gilt’ could be attractive. Its purpose is to raise the funds to ‘build back better’ (and greener). For those pension schemes seeking to match liabilities and have something to report in their Implementation Statement, this could be a winner.
What has become normal is the environment of ultra-low interest rates. How many times have you heard the plaintive cry that, surely, they can’t go any lower? Many trustees still have a tendency to focus on the asset side of the funding equation, blinkered to the disproportionate impact of a relatively small down tick in yields.
Trustees are grappling with new requirements in respect of matters to which they have hitherto given relatively little thought. The reporting requirements for Environmental, Social and Governance (ESG) aspects of their investments is causing some scratching of heads. The principle of ‘what gets measured gets done’ will result in more focus on these important matters, and they will become normal soon enough.
Anyone who has spent any time working in pensions will be unphased by these developments. Change is a constant. It’s one of the reasons why it’s so fascinating.
Meet the new normal: same as the old normal.
I overcame my initial scepticism and applied for Professional Trustee Accreditation via the PMI. If I’m honest (one of the requirements), I was worried that my lingering imposter syndrome would turn out to be justified and I’d have to seek a new career after 28 years in the trustee industry. I needn’t have worried. The process was relatively painless and I now bask in the glow that being accredited provides. My business card has never looked better!
This article was featured in Pensions Aspects magazine January edition.
Last update: 27 January 2021