Simple pension wisdom from Steve Webb

Is Steve Webb emerging as the long awaited Martin Lewis of pensions? Webb’s deep understanding of state benefits and of the state pension in particular, coupled with a kind and liberal manner, means he is becoming much more than his job would suggest.

On linked in, Webb describes his role as Partner at Lane, Clark and Peacock as “part-time” and from his twitter feed it’s clear that he is spending much of his life campaigning to make people more aware of their rights to benefits they may not have known they had or that they were in danger of losing.

Webb’s achievements since leaving parliament

In particular, he has successfully campaigned  to redress state pension entitlement for married women whose husbands became eligible for state pension after 17 March 2008 and who were unknowingly entitled to ‘enhanced pension’ that would have boosted their payments by up to 60 per cent.

Now he is campaigning for a separate group of 200,000 parents (mainly women) of working age.

When child benefit is paid to the working parent rather than the parent at home with the children, the latter can miss out on national insurance credits, which may leave them later failing to qualify for their full state pension.

This isn’t an entitlement but a loss of entitlement and it’s happening because people aren’t aware that by claiming child benefit in your name , you get a credit for your state pension which could be extremely valuable in years to come.

LCP calculated that over the course of a typical 20-year retirement, the total loss for a person who missed one year of contributions would be around £5,000. This is because the maximum state pension payout is currently £164.35 a week for those with 35 years of full-rate NI contributions. Each year missed could cost 1/35 of the pension, which works out to £4.69 a week or £244.18 a year.

I admire the way that Webb and LCP work together and it’s making both household names. The Mail, Times and Financial Times are just three of Webb’s regular platforms and it’s creating goodwill towards LCP and giving actuaries a good name. This is precisely the way that the pension industry can work with Government to restore confidence in pensions.

Much as I like the current pensions minister, Guy Opperman – he hasn’t the academic background or the analytic brain to do what Webb did in restoring the state pension or what he now does in troubleshooting  problems that arise because of the complexity of the rules governing pensions and benefits.

Webb is an important and (at a time when Labour has little expertise in this area), a necessary critic of Government pension policy – especially as it touches state benefits.

Understanding the complexity of pensions and benefits

Like Gareth (the Ferret) Morgan, Webb is  obsessive over numbers and a champion for people who aren’t. The vulnerability of most people is time and application and we should be grateful to those like Webb, Morgan and my friends as the Lower Income Tax Group who take time and apply themselves to the finances of those at the bottom of the financial pyramid.

This work is not commercially rewarded as it should be , a mark of the systemic asymmetry to rewarding the wealthy from the public and private purse. How Webb relates to Morgan and LITR is complimented by how we works with Ros Altmann.

Steve Webb and Ros Altmann

I think of Webb and  Altmann as yin and yang.

Webb shares with Ros Altmann, a cache of being a “former pension minister”, and when Altman stepped up as pension minister, Webb found himself handling her portfolio of speaking engagements. I remember him remarking that he had no idea so much money could be made so easily. For all his financial literacy, Webb is shrewd in a political not entrepreneurial way.

He has a  very different intelligence from Altmann but they are driven by a similar determination for fairness. Both have strong groundings in economics. Webb worked for the Institute of Fiscal Studies before entering parliament in 1997 while Altmann worked both for the Treasury and in the City as an economic strategist.

More to give

Webb is still a young man, he only turned 55 in July last year and his actuarial chums will tell him he is little more than half way through his life! Since leaving parliament in 2015, he had a short spell working with fellow Christian , Phil Loney – then CEO at Royal London before becoming a partner at LCP at the start of  the pandemic.

I sense that there is more to come from this man and that if he isn’t to return as an MP, a seat should be his in the Lords. If he doesn’t make it to that august club then there are platforms for him which though not so elevated, may make him more effective.

Wherever Webb’s work takes him next, I hope it will be in the spirit of his career to date which has consistently delivered good things to pensions.  He is admirable and frustrating in equal measure and people who have work closely with him talk of his considerable chutzpah , whether in parliament or in the reconstruction of his time in parliament in the past six years.

That agility in telling the stories of the state pension, the introduction of auto-enrolment and the bombshell of the pension freedoms has not been at the expense of his integrity. In many ways, it is his crafty preservation of his reputation that is one of his most attractive traits as is his very knowing self deprecation.

He is more aware than anyone that a prosaic sounding brummie, who loves grey suits will always be associated in the public’s mind with the Lamborghini


About henry tapper

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