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I hope @USSEmployers & scheme members take a few moments to read this interview👇w/ Paul Myners in @TheActuaryMag, whose URL appropriately includes the words "interview-challenging-convention". Comments below. 1/
theactuary.com/features/2019/…
theactuary.com/features/2019/…
Given his long career in the City👇, including as CEO & Chair of Gartmore pension fund manager, Myners is not someone whose views #USS executives can dismiss as that of an uninformed, radical academic recently turned pensions expert. 2/ 
In addition to serving as City of London minister under Gordon Brown, Myners was the author of the influential Myners Report 👇 on pensions fund & other institutional investment. 3/
fnlondon.com/articles/the-m…
fnlondon.com/articles/the-m…
In the above interview, this is what Myners has to say about the influence of @TPRgovuk in driving “reckless conservatism of buying more bonds”, contrary to sound investment practices: 4/
“We are pushing pension funds into a form of reckless conservatism of buying more bonds,” 5/
"Investors who are not constrained by benchmarks or by actuarial models are not currently filling their pockets with long-term debt, but that’s precisely what defined benefit pension schemes are doing." 6/
"All the incentives for a regulator are to avoid things going wrong, and they have largely gone unchallenged on this particular issue." 7/
"In my view, an enlightened regulator should be more in the public eye, promoting debate and discussion, and working with academics and others to ask questions, such as on pension scheme design." 8/
The following is of relevance to the sort of short-term automatic triggers USS executives are trying to impose: 9/
“Should pension trustees really be monitoring their managers’ performance over the last 90 days?” he asks. “Is that relevant to a pension scheme which could still be paying out in 50 years’ time?” 10/
In the event of under-performance, he suggests trustees should ask: "Has there been some deep structural change at the manager, or is this just part of the natural cycle?" 11/
Myners also notes the following general problem of lack of expertise among scheme trustees: 12/
"You have this inversion in pension investment management. The trustees who make the most important decisions of all, around risk tolerance, asset allocation and manager and adviser selection, are the least experienced, and get paid next to nothing for doing what they do." 13/
"On the other hand, the investment managers, who have the greatest experience and who are the best paid, are making the most insignificant decisions on share deals." 14/
According to the interviewer, Myners welcomes the rise in professional pension trustees, but feels too many come from the industry and simply replicate past practice. 15/
Although two have served as trustees of other pension schemes, none of the UUK or UCU appointed trustees has professional actuarial expertise or expertise in matters of pension scheme design or investment. 16/
For that reason, they are not ideally placed to challenge the expertise of the #USS executives & scheme actuary & to question their practices. 17/
The independent trustees bring a fair amount of professional expertise regarding investment. But they also bring a heavily imbalanced perspective. 👇18/
Employers have been informed that the #USS trustees have asked UUK to develop a proposal for the automatic triggers of higher contributions to be combined w/ the lower bookend 29.7% contribution rate. 19/
I hope the trustees will also provide UUK & their actuarial advisers the opportunity to make the case directly to them, in person & at length, on behalf of the automatic trigger proposal they develop. 20/
On pp. 16-18👇, @ucu's actuary @FirstActuarial makes the case that the trustee should draw, to a greater extent, on the input of employers & members, not just #USS exec, in exercising their fiduciary responsibility to scheme members & sponsors. 21/21
ucu.org.uk/media/9971/Fir…
ucu.org.uk/media/9971/Fir…
