SCOTTISH pensions providers could move ahead of their rivals by banding together to launch a new breed of transparent, low-cost pension plans, high-profile fund manager David Pitt-Watson has proposed.
Mr Pitt-Watson has long been one of the financial services industry's more critical insiders on issues ranging from the engagement of asset managers with the companies they invest in to the level of charges levied on investment products.
In recent years his focus has turned to pensions, where he is pushing for UK providers to learn from successful overseas models and believes the industry in his homeland could lead the charge.
He said: "If I was in Edinburgh working for one of the companies there, I would get together and say let's create a safe, basic pension and call it the Scottish pension."
He mused that a distinctive Scottish pension with minimum standards on costs, transparency in charges and requirements about how it is sold to savers could give providers north of the Border an edge on their rivals and spearhead change in the industry.
Mr Pitt-Watson, a Scot who has made his name in the City of London, said he believes many individuals in the pensions sector are eager for reform.
"My observation of the pensions industry is that I do not think its structure is that great, but I think a lot of the people within it are good people trying to do the right thing," he said.
He said that those working in the sector were aware that people were being sold products – by respected organisations –that were inappropriate.
"If you say to people in the industry we should only be offering good pensions that are broadly safe, they will say 'that is what we want to be doing'.
"The question is not the destination. The question is how we take the journey."
Recent work conducted by Mr Pitt-Watson under the auspices of the Royal Society of Arts' Tomorrow's Investor project has shown that, thanks to a combination of lower charges and economies of scale, a pension saver in the Netherlands can expect a 50% higher income in retirement that their British equivalent.
The issue is just one he has been pursuing since his former employer, the giant fund manager Hermes, last year sold the Focus Funds business he previously chaired.
Another project is a forthcoming book on the financial crisis, he jokingly says he would have liked to have called the Queen's Question.
While admitting such a title might be lost on an overseas audience, Mr Pitt-Watson is taken by the Queen's query about the credit crunch posed to academics at the London School of Economics on a 2008 visit: "Why did nobody notice it?"
The responses have ranged from the failure of pension fund managers to hold companies to account, to the way banks measure the risks on their balance sheet.
With co-authors, Harvard University academic Stephen Davis and Jon Lukomnik who used to run the New York City pension funds, he is tackling some of the weightiest and most contentious topics of all: how the financial crisis happened and how to prevent its recurrence.
"This book looks at how the financial crisis happened, how we could have made such a pig's ear of managing one of the country's most important industries," he said.
The project, slated for delivery in September, explains why a man used to gracing the corridors of power in the City and in Westminster is occupying a pokey, overheated office at London Business School while he seeks to meet his September deadline.
There is also of course the stimulation that can be found strolling along the dimly-lit corridor of the finance department.
"There is always somebody here who I can have an argument with," Mr Pitt-Watson said.
And Mr Pitt-Watson does like an argument.
While at Hermes, where he founded its Equity Ownership Services arm that advises pension schemes on how to be responsible investors, he was the go-to man for reformist views on the financial services industry.
He was also an adviser to Labour prime ministers Tony Blair and Gordon Brown and had a brief stint as the Labour Party's deputy general-secretary before returning to the financial services industry.
Mr Pitt-Watson, who was brought up in Aberdeen, Bearsden and Forfar, credits his father, a Church of Scotland minister and his mother, a woman of strong opinions, for his moral sense as well as continued love of singing.
He worked with Conservative MP David Davis, and Lord McFall of Alcluith, the former MP for West Dunbartonshire, on the Future of Banking Commission.
He has also been at the forefront of pressing for reform in the institutions of the City of London.
This he combines with duties such as working as the treasurer of the charity Oxfam and chairing the United Nations Environmental Programme Finance Initiative.
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