One week on- how was “freedom” for you?


More questions than answers

The Pension PlayPen met as usual in the Counting House to discuss our experiences of Pension Freedom to date. The consensus – more questions than answers.

Call volumes to the insurers have over-shadowed what the Government hope will be the main event- Pension Wise. Word from Pension Wise, who were represented at the lunch is that they are within capacity both for booked calls and meetings and at TPAS.

What feedback there has been from those using (or misusing) the Pension Wise service has been positive. The Guardian’s Caroline Groves’ experience of using Pension Wise is well worth reading

The session was comprehensive, although if I ever uttered that “is good advice” I was quickly reminded this was guidance not advice. My chap knew his stuff and he came over as not only diligent but as if he really cared that I took the right decisions. He even answered some of the questions which the blanket coverage in the newspapers had so far failed to do.

We will hear more from Standard Life, Alliance Bernstein, Fidelity and Aegon at this evening’s event at the Institute and Faculty of Actuaries to which readers of this blog are most welcome (tickets are no longer bookable but places can be reserved – please mail Details of the gig are here

Pensions the slaves to Home Ownership

Outside the ivory towers of the pensions industry, pension freedoms are playing no part in this general election whatsoever. The Conservatives have clearly decided that the 2014 Rabbit is insufficiently sexy and have moved back to the Thatcherite crowd-pleaser, house ownership.

Having released us from the servitude of the annuity, we are now free to own and continue to own our own homes, providing us with the financial well-being to vote conservative for generations to come. The concept of votes cascading through the generations is appealing to those in Conservative Central Office.It is particularly appealing as it can be achieved by chipping away at pensions (see yesterday’s blog) or by eroding the asset base of the local authorities by forcing them to sell their prime social housing at a discount.

It should be noted that these local authorities are already mortgaged to their pension schemes which are in massive deficit and continue to accrue liabilities like a drunk with a bottle of vodka

The office of pension irresponsibility hard at work

So pension freedoms are not the great retail offer, they are an election side show to the well-being of home ownership and the prospect of unlimited wealth founded on unlimited credit. If the turn-key for credit is the soon to be launched first-time buyer ISA, then the incentives are stacked still further in favour of wealth creation through property ownership.

So what pension freedom are presented as to the public, is not a means to create liquidity, but a further means to access property ownership- or at least that is the conclusion that most people can draw from the Tory manifesto.

The office of pension responsibility at the end of Whitehall is mortgaging our retirements to a fantasy of bricks and mortar.


Property – the way to a nation’s heart?

As I mention yesterday, this apparent wealth is only held on certain assumptions

  1. That property can create sufficient liquidity to pay for the activities of daily living (for those on continuos holiday in later lives.
  2. That property can pay the impending care bills creating by the deterioration in health of this in later years
  3. That the housing stock can pass from generation to generation despite claims on it from competing inheritors.

The concept of a capital reservoir arising from pension saving which can be used to pay the bills, healthcare and create some form of liquid legacy for the next generation is not being promoted by the Conservatives, nor by any other party.

Anyone for prudence?

So rather disappointingly, no one is speaking up for financial prudence, for long-term saving nor for the prospect of pension wealth being invested in a socially responsible way.

I am afraid that for me, pension freedoms are being stomped on by the Treasury jackboot , obsessed by the feel-good factor of home and property ownership.

To counter this near-hysterical obsession with bricks and mortar is extremely difficult, politicians have their primary responsibility to themselves, to get re-elected, secondly to their parties, to get power and what’s left over can be allocated to conviction.

In this world the best lack all conviction,

while the worst are filled with a passionate intensity.

Reclaiming “pensions” from the hustings floor in May, I hope that our public will retain some form of perspective.

You cannot buy a a sausage with a brick, houses cannot pay bills and they are a pretty poor way of insuring people against their immortality and physical decrepitude.

In the meantime, my take on pension freedom is that it is the freedom for politicians to take the piss out of pension. This will be the prevailing theme for the next four weeks, after which- hopefully – we can get on with the business of rebuilding confidence – in pensions.




About henry tapper

Founder of the Pension PlayPen,, partner of Stella, father of Olly . I am the Pension Plowman
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