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The Trustee’s August 2011 Newsletter

An appropriate comment on the latest Newsletter would be “Good news as far as it goes”. My personal observations follow.

      We must all be pleased that the THPT’s investment performance in the year to March 2011 exceeded the benchmark target, as it has over the two years to that date. This gives us some confidence that the Trustee’s strategy can deliver the reduction in the deficit specified in the 2009 Recovery Plan.

       Performance fell short of benchmark over the periods of 3 and 5 years to March 2011, reflecting the worst years of the credit crunch crisis. Since March prospects for the global and UK economies have deteriorated and the Newsletter is appropriately cautious about the THPT’s future investment performance. Our next detailed understanding of the THPT’s position will come via the full valuation at 31 March 2012. We should see Its results early in 2013.
                                           
      Compared with this investment fundamental other topics covered in the Newsletter are of a lesser order. Noteworthy for me are

• Extended periods of office for Mr.Froeshaug as Chairman, Mrs.Ellis and Mr. Bartley. This is comforting in that it retains “professional” directors in the team established after the 2006 settlement with TH Global. That team has been enhanced by the appointment of Dr. Sushil Wadhwani, a recognized financial “heavyweight”, in succession to Dr.Ros Altmann  These extensions remind us that the “professionals”, who are the majority on the Trustee board, ultimately decide their own terms of office. Member Nominated Trustee directors are in the minority.
  
• Trafalgar House Pensions Administration’s plan to obtain business from third party clients goes back three years. So far it has not delivered any, but the considerable marketing effort may yet yield results. This suggests that entry to this market is more difficult than had been thought. I cannot feel too concerned about this, since it is difficult to see how such expansion can produce significant net financial benefit to the THPT, though it may be important for retaining quality staff.
  
• The format of the Newsletter is much improved. The presentation is  more reader friendly, but content remains informative, for example the succinct “Committee Reports” page.

What do you think?

Alan Ford

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