The cheques for the PMS savers are finally arriving. After three years this sorry saga is beginning to come to an end. A number of people deserve some credit in this affair but there are others to whom blame should rightly be attached.
The savers themselves are completely innocent. There may have been claims that the PMS scheme was too good to be true but that is easy to say from the position of the financially astute (or with hindsight). The PMS largely targeted older savers, offering good interest returns and claimed levels of risk equivalent to building society saving accounts. The scheme was continually promoted by the Presbyterian Church and indeed the social good it could do was repeatedly played up. My own mother (who is financially astute) always felt bad that she had not put any money into the PMS (until it all went wrong obviously).
The Stormont executive and the political parties here do deserve some credit. They campaigned for the savers to receive their money back. Jim Allister was one of the most vocal but all the political parties, including the nationalist ones presented a united front on the issue.
The British government is also not to blame. Their bank guarantee may well have been the catalyst for the disaster but the simple fact was that the government guaranteed bank and building society accounts. It is hardly the fault of HMG that the PMS was utterly disingenuous about the nature of its savings scheme. Furthermore the PMS was clearly running a bank without the proper authorisation which is against the law.
At this point the Stormont executive might be blamed to a certain extent as the regulation of the PMS was a devolved matter (see Pete’s excellent series of articles on the subject). However, the society had in actual fact been operating as a bank long before devolution was resumed: as such a little blame might be able to be laid at the door of the executive and before them HMG itself.
The lion’s share of the blame, however, must be pinned squarely where it belongs: on the PMS leadership. The PMS’s board seems not to have done anything about its illegal activities. It is still unclear who should have known or done something about this state of affairs and why they did not. The News Letter reported in March on proceedings for disqualification for a number of former PMS Directors. One former director of the PMS was also vetoed for a judicial appointment by Ken Clarke. He then told the News Letter that he was disgusted and that Clarke’s decision had cost him a significant amount of money: he seemed oblivious to the irony of a PMS Director complaining about lost money.
The other organisation which cannot shirk its moral responsibility despite all its attempts to do so is the Presbyterian Church. When the PMS foundered the Church was extremely rapid to distance itself from the PMS. It very rapidly pronounced that the organisations were completely unrelated. Whilst that may have been true in law it must be remembered that that is exactly the opposite of the position claimed by the Church when the PMS was doing well. Never did a copy of the Presbyterian Herald lack at least one advertisement for the PMS; at every General assembly meeting the merits of the PMS were praised to the rafters. When the society collapsed the rush to say “I never knew him” was remarkably like Peter’s denial of Christ. Unlike St. Peter, however, the Presbyterian Church was extremely slow and only partial in admitting its betrayal. Although some laud Stafford Carson for his work on the subject, it must be remembered that he was less than forthcoming about the amount of valuable property the PCI owns (I know Drumlins Rock for one disagrees with me but I stand beside my allegation that he was disingenuous in the extreme). The PCI ended up paying £1 million to the savers but Liam Clarke’s questions about the £42 million in the PCI’s central investment portfolio have never been answered.
The PCI presumably hopes that it can put the utter debacle it has suffered behind it. However, as the News Letter notes here a significant number of once very active members of the PCI have lost all faith in that institution: not really it seems over the loss of money but more the manner in which the church has conducted itself. I blogged myself about leaving the Presbyterian Church before this scandal broke: the issues I mentioned there which have helped cause so many to leave have not gone away. Adding the church’s behaviour over the PMS to the mix will only help in the gradual dwindling of a church which seems out of ideas and over this scandal at least completely without moral legitimacy.