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‘Man for the job’ must tread carefully

Simon Kew, our Director of Pensions was asked for his thoughts, following the recent appointment of Stephen Soper as Interim Chief Executive of the Pensions Regulator.

Stephen Soper

The new regulator has many admirers but could lose more if he presides of a pensions watchdog in danger of being overwhelmed by complex recovery deals

The start of August saw a new chief executive appointed at The Pensions Regulator.

Stephen Soper, who formerly held the post of executive director for DB regulation at the watchdog, takes over from Bill Galvin on an interim basis.

Since Galvin also held the role temporarily before being appointed full-time, there is already speculation as to whether Soper’s elevation will become more permanent.

Ros Altmann, pensions consultant, said: “When Bill Galvin was made CEO he had first been in that position on an interim basis, so it is entirely possible that Stephen could take over permanently.”

And it seems this is a desirable outcome since Soper is widely regarded as ‘the best man for the job’.

Simon Kew, director of pensions at Jackal Advisory said: “I hope [Soper] will take the role on permanently and soon as. Using [Liverpool Football Club manager] Rafa Benitez an example, the word interim before a title can be unhelpful.”

Stephen is particularly knowledgeable about DB pensions

Altmann added: “Stephen Soper is an excellent choice as interim CEO for TPR.  Stephen is particularly knowledgeable about DB pensions and there will be significant challenges ahead for employers and trustees in the on-going legacy DB schemes.”

A quick look at Soper’s CV reveals 23 years’ experience in financial services including a range of executive positions such as commercial bank treasurer, board director, chief operating officer of a UK Bank, group change director and restructuring director.

It is Soper’s previous role as restructuring director that might prove most useful if the regulator continues to sanction more innovative funding deals, such as the recent case involving the Kodak Pension Plan.

In line with chancellor George Osborne’s request that the regulator be more sympathetic to the plight of sponsoring companies when it comes to financing DB arrangements, the watchdog is expected to consider more of these types of arrangement.

Consequently, Soper will have to be au fait with some of the most complex elements of DB management.

Lena Tochtermann, CBI principal policy adviser for pensions, said: “Ensuring that the new statutory objective to help companies run their business effectively while continuing to fund their scheme is reflected in the regulator’s day-to-day activity should be a key priority.”

Raj Mody, head of pensions at PwC, believes Soper has the requisite credentials.

The pensions industry relies on innovation to survive and why should that be any different at the regulator

“The pensions industry relies on innovation to survive and why should that be any different at the regulator. It needs to have an open mind and we have that with Stephen who is pragmatic and sees different viewpoints,” Mody said.

Richard Farr, partner at BDO, added: “Stephen is well placed to assume Bill’s mantel, and I am sure he is looking forward to the challenges ahead given that Kodak has set a very large precedent in the workplace.”

However, there are those that issue a word of warning to the new chief exec.

Given the highly technical nature of restructuring deals, and the potentially huge amount of risk that trustees may be taking on, the regulator may find it is out of its depth when it comes to accepting, or indeed, dismissing such plans.

You have to question whether the skillset at the regulator is fit for purpose

One commentator who asked to remain anonymous, said: “Looking at new solutions [such as Kodak] is very high risk and you have to question whether the skillset at the regulator is fit for purpose to manage these new demands.”

Alongside Soper, the regulator also hired Pension Corporation partner and principal at boutique advisors Camdor Global Bob Swarup, in an investment adviser role. However, further new appointments are yet to be announced.

Soper has a fine balancing act on his hands and will need the right team in place to make sure he gets it right. Allowing any flawed deals to slip through the net could be the regulator’s undoing, while taking the right decisions will ensure the safety of many more UK companies and their DB schemes.

Category : Savants in the News — admin @ 11:00 pm August 6, 2013

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