'The arrogance and
complacency are staggering'
(Filed: 13/11/2004)
The Telegraph printed one
policyholder's criticism of Standard Life a fortnight
ago and chief executive Sandy Crombie's response last
week. Here are some readers' comments - and we are still
keen to hear other views
Sandy Crombie trots out all the
well-rehearsed arguments in an effort to explain the
disastrous effect of Standard Life's actions on
policyholders' savings. The board's arrogance and
complacency is staggering.
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Under siege: policyholders have attacked
Standard Life's performance
record |
Would it not have been nice for Mr
Crombie to say that he and his fellow directors have cut
their own remuneration and severance packages in line
with the depreciation of members' investments, thereby
sharing the pain with us?
John Farrant, Plymouth, Devon
My dealings with Standard Life began five
years ago when I left employment and set up my own
business as an accountant.
I transferred the benefits in my company
pension scheme to Standard Life and chose to invest in
their Property Fund. Since 1999, the fund has shown an
average growth of more than 10 per cent per annum and I
am more than happy with their performance.
I am able to check and compare fund
values and performance on their excellent website and
have found their staff both helpful and friendly when I
needed to contact them. I do feel that people should
take more responsibility for their investment and spend
more time checking that they understand the risk before
committing funds.
Hopefully, we will then avoid the
ever-increasing culture of claiming for wrongful advice
which appears to be becoming the norm even if, through
no fault of the investment house, their investment does
not do well.
Howard Burkhardt, Blackburn,
Lancashire
Mr Crombie's article had little to say
about remuneration, particularly regarding long-standing
investors in pensions policies. As I understand matters,
any Standard Life policyholder having a pension mature
before the 2006 demutualisation will be penalised if
they do not elect to take up their pension at the
appointed time.
Many people have been members for decades
contributing to a healthy society. An imbalance seems to
have arisen insofar as those hardest hit are being
denied the prospect of some recompense of financial
benefit that may result from demutualisation. No doubt
the future is important, but there would not have been a
future without those that placed trust in the integrity
of financial professionals years ago.
Keith Sargent, Worthing, West
Sussex
I am sure my quandary is shared by many.
In February, 1990, I started a single contribution
scheme, which I should take in August 2005, my 65th
birthday. Seemingly, if I postpone, then there will be a
further deduction of a market value adjuster.
However, if I do convert next August
there is no chance that I will receive any benefits from
the change from a mutual company to a quoted one. Surely
Standard Life should make some pronouncement on the date
of qualification and what may happen to similar cases.
After all, we have stuck with the company and should
receive some consideration in return.
James Inglis, Largs, Ayrshire
I received my statement yesterday, which
doesn't look as bad as last year's, but that's only
because they have changed the market value adjuster.
Last year the "new look statement" added £20,000
contributions to the previous statement and came up with
a total significantly less than I started with.
This year, they seem prepared to credit
me with 85p for every £1 I gave them. Perhaps if the
directors of Standard Life stopped paying themselves
such handsome bonuses at my expense and sent me a
statement which assumed that I would not transfer my
money before retirement, I wouldn't have a pensions
crisis. And, if the Chancellor gave back the billions of
pounds he's taken out of the pensions industry in taxes,
perhaps there wouldn't be a pensions crisis at all.
Steven Hudson, Leeds,
Yorkshire
In 1992, as a chief executive with 15
staff, we chose Standard Life to run our Group Personal
Pension Scheme. Standard Life were helpful and efficient
and, of course, it was a good time for investing.
Times and markets changed but Standard
Life thought itself invulnerable. Throughout the
demutualisation furore of 2000 it described anyone who
wanted a windfall as a carpetbagger.
By 2003, Standard Life's "Update"
briefing for investors was full of cuts in bonus rates
and reduced surrender values and, a little later,
withdrawal penalties. By then the value of my fund had
fallen back to 1998 levels, losing an astonishing 27 per
cent between April, 2002, and April, 2003.
Times were hard in the markets but not
that hard. Senior executives continued to be
well-rewarded for their failure. Mr Crombie's
appointment seemed good to me but now he sounds just
like his predecessors. Nothing, it seems, is Standard
Life's own fault.
Mutual status was an absolute article of
faith for Standard Life and a huge price was paid for
ignoring what was plain to others, in terms of what was
happening in markets and what was needed to move with
these changes rather than try to battle against wind and
tide.
The last generation of Standard Life
managers were given a strong business and, in their
pride and pig-headedness, they very nearly ruined it.
Despite the flannel in his article, we have to hope that
Mr Crombie is the right man to get it back on track
because, between him and the Chancellor, even those of
us who have been saving for the long term are wondering
what sort of financial future we really have.
Tim Nicholson, Cranbrook, Kent
I wrote to Mr Crombie in March, 2004,
complaining about poor performance, wrong decisions and
the excessive remuneration for the people making those
poor decisions.
When my endowment matures in October,
2005, after 15 years' continuous investment I can expect
to receive an annual compound return of about 3.5 per
cent - which is horrendous when you consider the high
inflation of the early years.
I received a reply from a "Customer
Service Representative" in April, 2004. This was
complacent and arrogant. It said that "the value (we)
receive on maturity will be a fair reflection of the
value of (our) investment with Standard Life over the
period it has been invested" and "the maturity value of
a typical 15 year plan, maturing today still represents
an average return of 6.5 per cent a year on the premiums
paid".
This just shows how they have used my
growth to overpay members whose policies matured just 18
months earlier. He added that "Standard Life directors'
remuneration is among the more modest in our
industry".
Robert D MacKenzie, Banbury,
Oxfordshire
Given the huge resources available to the
chief executive of Standard Life, I was disappointed to
read his weak and incomplete response. It seems to me an
affront to policyholders to tell us the Standard Life
investment managers deserved and deserve continuing high
levels of remuneration, while excusing their failure to
call the markets.
It has been highly offensive to
policyholders whose money was spent resisting
demutualisation only to be told by the same management
that actually it is now necessary.
The truth is, the management at Standard
Life and other insurers paid out too much to keep up
their marketing claims and, when markets did not bounce,
they were short in the fund. It seems to me Standard
Life has made a hash and is now abusing its members.
None of this matters to Mr Crombie and
the other board members because they will continue to
receive their handsome salaries, pension accruals and
probably a bonus at demutualisation.
There are a lot of bitter people out
here.
Andrew Smith, Epping, Essex
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