I’m pleased to see Sarah Gordon , formerly FT Business Editor , looking at the problem Big Government is having herding cats to deliver productive capital from pension funds into the UK economy.

She focusses on the problems getting private equity managers, insurers and Government quangos such as the British Business Bank to work together while pursuing independent agenda, often in competition with each other.

She could throw into the mulligatawny, a few spices. The various regulators, the PRA, TPR and FCA are also highly competitive with each other , they can – when working well together – deliver a soup that all can enjoy, but too often , the product that is produced is unpalatable.

Serving the broth up, is proving a further challenge. The private investor can access investments using a number of tax advantaged arrangements, including venture capital trusts , EIS and SEIS schemes as well direct investment into listed investment companies (investment trusts). These investments sit on wealth management platforms managed by IFAs.

Some of these start-ups and scale up investments are purchased by institutional investors through insurance platforms which offer productive capital through permitted links , eased to accommodate unlisted investments and in particular through Long Term Asset Funds (LTAFs). The largest institutional investors can by-pass platforms and invest directly into the private markets. These investments are typically managed by trustees and the investment arms of insurers.

The investment strategies compete under differing regulatory frameworks. Insurers are subject to Solvency regulations overseen by the PRA and the FCA, while pension schemes are subject to the scrutiny of the Pension Regulator and it’s (ahem) “soon to be published” DB funding code.

The extraordinary complexity with which the dish can be served is made even more complex by the taxation of all the different types of dish on offer. Pensions can be served up as occupational schemes (with or without guarantees). These come in two types, DB and DB but are expected to be joined by a third – CDC. There are other variants including executive pension plans and small self-administered schemes. The pension crockery involves many shelves.

Is it any wonder that Governments are “baffled” whether coloured red , blue , green or orange?

Too many stakeholders spoil the broth

The challenge facing the private sector is to get change into a system with so many competing stakeholders. To get agreement on Royal Mail’s CDC scheme, the Government has had to write primary legislation through the DWP, a CDC funding code through the Pensions Regulator and then get agreement on taxation from HMRC (still ongoing). When money finally is committed to the scheme, we hope from April, the investment strategy will, it is hoped, look to the future deploying long term investments, potentially productively financing the UK economy. There is no certainty of this and the investment arrangements have yet to be announced but the Mansion House reforms are predicated on using the investment freedoms of non-guaranteed investments to break away from debt-based investment that dominates the “DB end-game”.

It has taken the better part of six years to get the first CDC scheme to the table and it may still be returned to the kitchen. The cooks are too many to mention, hardly a pension actuary or lawyer in the land cannot claim to have been involved in some part of the proceedings. The only stakeholders yet to be involved are the potential beneficiaries.

So how is food put upon the table?

The problems facing the Government are bound up with the complexity of the supply chain, there are two many ingredients, serving utensils and too many cooks.

There is an answer to all this, which rests with the private sector but it is not an answer that anyone is very comfortable with. It is mandation. The direct intervention in the markets by Government to achieve the greater good , could require all the stakeholders to do things in a set fashion, rendering what is currently a very long a la carte menu, a prix fixe.

This is the end-game of non co-operation and it is one that grates with the pension industry as it does with restaurateurs. But it is a solution that the public like – witness Pension Bee’s success in offering a complex product so simply that people choose it-not to choose.

Complex in the kitchen – simple on the table

However complex the means to get the food to the table, what gets served up as “pensions” must meet the basic nutritional requirements of people at the table. Serving the food late means serving it cold and to hungry bellies. People expect pensions , not portals, they are interested in having positive bank balances at the end of the month, not extravagant tax-mitigation arrangements. They want to know that the money they have set aside for the future is being managed for social good, not to know the minutiae of the cooking process.

Apologies for the mixed metaphors but we really do need to learn how to cook our customers fare which meets their expectations, keeps them from getting hungry and delights them in the eating.

A national wealth fund worth £2.5 trillion , is undoubtedly a worthwhile concept for any political party to create a policy around. But that money supports the dreams of 32m working people. The task of Government is not to create one great national pot from which we all sup, but to manage the battalion of chefs to ensure the broth is not spoiled.

I have said this many times before we need a common purpose for pensions that is as simple to understand as a “consumer duty” or “value for money”. It is what the Australians have discovered, immensely hard to do, but when we have done it, then we can start delivering to the nation a simple and easy to understand product – a wage for life.

Simple things are often the most difficult, but that should not stop us aspiring to them.