Too late Chancellor – that ship has sailed!


If I were a cynical editor looking for a story to focus on, I would look no further than speculation on the autumn statement. Yesterday the Telegraph floated a story, purportedly a leak from #10, that the Chancellor was going to rob rich old gits to give youngsters more incentive to save.

I don’t have access to the Telegraph’s comment boxes (this is “premium” speculation) but when Hurricane Hammond hit New Model Adviser, it  quickly grabbed all the attention.attention

The comment count tells us exactly what bothers the new model adviser.

Within minutes of NMA, FT Adviser was reporting that the “Old for young pension tax”- was being shunned by the rest of the industry. The snowball had broadened with the comment of financial advisers keen to point out the plan was unworkable, unfair and foolish.

I thought I might point out that “we would say that” and that anything more unworkable, unfair and foolish than the current pension taxation system would be hard to devise.

I spent much of the rest of yesterday morning receiving calls from financial journalists as I appeared to be the only supporter of redistribution of Government incentives in favour of the “have-nots”.

As I talked, it occurred to me that one of the principal reasons given by advisers for transferring pensions wealth into SIPPs was to protect that wealth for the next generation. I chuckled to read IFAs falling over themselves to protect their wealthy old clients from any such wealth redistribution.

The reaction of the financial community to an attack on its principal source of remuneration is perfectly natural but it is not commendable. What is commendable is Hargreaves Lansdown’s reported proposals to Government

‘When do we want money to go into [pensions]? When you are young. Who doesn’t have the money to put into pension pots? The young. So let’s weight the government incentive in favour of young people. And it’s simple.’

This from the forever-young Tom McPhail.

I am not a PR agent, but if I were, I would listen to Tom McPhail and watch Hargreaves Lansdown. You don’t need a weatherman to know which way the wind blows, you need Tom.

Sense from Ros Altmann

I don’t agree with Ros in many things , but I do like what she has written about intergenerational fairness on her blog this morning. She argues that direct help to the young is better than redistribution through the tax-system.

The problem here may be the legislative agenda that does not have space for the recommendations she is making. If they cannot fit into the Finance Act, can they compete with the BREXIT avalanche.

We should remind ourselves again, that the opportunity for radical tax reform of pensions was missed in 2015 to stave off BREXIT, Governments do not often get second chances – the boat has sailed and with it the chance of serious progress on housing, social care and juvenile debt. Ros, you were a part of the Government that so let you down.

Some advice to the advisory community.

Most of us old gits, were young bucks in the eighties and nineties. We have grown up with our clients and those clients we now have, have got very wealthy through their own endeavours and through random factors such as the sustained growth in house prices.

Advisory firms report that there are no young people coming into financial advice.

Could it be that we have been pulling up the rope ladder behind us? Could it be that we have left no-one helping the young with their plans? I suspect that the 48 comments on the NMA story reflect just that.

Hargreaves may have a slightly different pitch. They may consider that the shareholders would like to see new advisers advising new customers in decades to come. Consequently Hargreaves Lansdown, through McPhail, are pitching through Government to the next generations who will not become wealthy old gits until the second half of this century.

This can variously be described as a long-term strategy, succession planning and sucking up to Momentum , all of which have obvious long-term advantage to the HL share price.

A lesson to be learned

Financial advisers would do well to look at Hargreaves Lansdown and learn. This sentence will probably cause considerable spleen amongst the advisory community but it needs be said.

Simply peddling your own pedillo is all very well, but your range is limited to your own efforts. Hitching your pedillo to the back of a yacht takes you wherever the yacht can go. Hargreaves Lansdown simply want access to the new waters.

Last night I listened to Tim Jones, former CEO of NEST brilliantly explain why we could not hold back the technological advances that the internet had brought, nor the inevitable changes to our working practices that social media has brought. He pointed out that the Labour party had won the hearts of our nation’s youth by capturing social media (in fact stealing it from Farage). Having been at #CPC17 I can tell you that I am about the only person over 50 who was using that hashtag and – as with the room of old people in which I was sitting- about the only person who had phone to hand at all!

Labour own social media

Labour social media

Too little too late – we are in a new paradigm whether we like it or not.

Tim hates it all – he claims we are sleep-walking into a surveillance society and handing the social media moguls who run Linked-in, Facebook and Ali-Baba the monetisation of our identities. For Tim, the fragmentation of the great financial hegemonies, the banks and insurers and fund mangers is inevitable. He sees social media as corrupting this change as people seek to win back self-determination in their business and social lives – but find themselves a slave to the very tools they trusted.

As I listened to his magnificent rant in the Guildhall last night, I realised how absurd the argument over inter-generational fairness has become. It is impossible for Hammond to win the hearts and minds of a nation’s youth, employing the carrot and stick of taxation. For him to have any chance, he is going to have to be smart like McPhail and mobilise the new upwardly aspiring voters who use their phones for everything.

I don’t agree with Tim Jones, I don’t think we are all victims of social media, I suggest that as with any dynamic social trend, those who win will be those who use the opportunity and those who lose will be the rest.

Hargreaves Lansdown do not need to win the argument against the IFA community, they need to win it with the very voters that Hammond is after. The difference is that young  people listen to McPhail and co, they do not listen to the fractious IFAs and I suspect they are not listening to Hammond.

One old git in the audience last night demanded the Tories reclaimed social media to “put young people right”. The idea that you can own democracy is still prevalent throughout the geriatric oligarchy.


that ship has sailed

About henry tapper

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