Head of Membership Engagement James Walsh finds schemes – and his own team – adapting remarkably well in the circumstances.
I usually start these articles about what we have been hearing from our members by saying the PLSA team has been busily criss-crossing the country to meet scheme managers at their place of work and get a first-hand ‘feel’ for the challenges they’re facing.
This time it’s different. There hasn’t been any criss-crossing at all since Lockdown started. We’ve swapped the train for Teams and the motorway for Zoom and – perhaps slightly to our surprise – it’s worked out pretty well.
In fact, by the end of July we had totted up more than a hundred member ‘meetings’ since the start of the year – comfortably more than across the whole of 2019. More importantly, we’ve had some very insightful conversations with our members. And ‘we’, by the way, is the Membership Engagement team of Cheryl Wilkinson, Helen Lamb and I, plus our CEO Julian Mund. We share this work between the four of us and share our findings with all our PLSA colleagues.
The headline from these conversations is that schemes have adapted remarkably well to the new environment. Most of our members tell us working from home has gone pretty smoothly, administrators have adjusted well and pensions are being paid on time. Some even report shorter and snappier trustee board meetings, with better delegation to committees.
Two Covid ‘buts’
This positive narrative comes with two big ‘buts’. The first is that the prospect of interest rates staying lower for longer means even more upwards pressure on DB liabilities and funding requirements.
The second ‘but’ is that a number of our members – I would call it a significant minority – have given us pretty eyewatering accounts of the difficulties faced by their sponsoring employers. It’s no great surprise that the starkest examples come from the aviation, energy and transport sectors. Whatever kind of economic recovery we get, these schemes face a major impact on sponsor covenant.
The usual suspects
Covid-19 aside, the topics cropping up most frequently in our conversations are largely unchanged, with DB funding, ESG and a mix of GMP and data challenges topping the list. Even in this age of DC provision, DB funding and administration remain central tasks for many PLSA members.
ESG almost matched DB as the top issue in our most recent meetings. Many schemes are introducing ESG investment options, and the increasing reporting requirements surrounding ESG are high on the agenda. It was pleasing to hear positive comments about the PLSA’s resources for members, such as our Stewardship and Voting Guidelines and our Practical Guide to Trustee Duties on ESG and Stewardship.
McCloud set to dominate
More than 40% of our member meetings in the second quarter of the year were with local authority funds – a key section of our membership. They raised many of the issues that I’ve already mentioned, but one stood out above all the others – the McCloud judgment and correcting the age discrimination that it identified. Just assembling the historic employment data needed is a tough ask. One head of a local authority fund expects it to dominate his to-do list for the next two years – a sobering thought.
Members were mostly very positive about how the PLSA has adapted its services during the pandemic – especially our webinars. These are a classic example of something that had been ‘on the agenda’ for months as we looked to connect with more members, regardless of their location. Now we’ve had to just get on and do it. The full ‘back catalogue’ is on our website for you to watch at your leisure; it’s a great resource for CPD and training.
It looks like our membership engagement work will be Teams- and Zoom-based for some while to come, but less time on travelling means more time for talking, so that’s not all bad. If you’d like to set up a call with me or my colleagues then please contact me on [email protected]. We’re always pleased to hear from our members.