Too much stick and not enough carrot and the donkey won’t move on. When the carrot turns on you with a stick, it gets confusing. I feel confused and  that is the problem with the general public. We are tired of being promised things that don’t turn up. It is the same locally as globally. The same in the NHS, pensions, teaching. We are being beaten up by the carrot and we’re getting  a little panicky.

In pensions we know the things we want and what we haven’t got. Parochially, we  haven’t got the big PR kicker, the pension dashboard, we haven’t got an alternative to the annuity (10 years after freedoms) and we don’t have an answer to funding the long term care that most pensioners expect to need later in life.

We do however have massive social discontent about the removal of the winter fuel allowance and there is every chance that either contributions to our workplace pensions will go down (because of extra NI) or benefits at retirement will be cut (cash and inheritance).

The same sense of short-term deprivation on the promise of more later, is besetting Wes Streeting as he tries to sell his vision for the NHS. There are funding crisis’ in our jails and in education (a report on special needs kids is in the FT today)

“Everything, everywhere – all at once” has been the buzz-phrase over the past few days. For Streeting it was a way of linking his vision to that of Rachel Reeves (and that of Emma Reynolds) for “growth”. Growth is the cure for everything , everywhere – all at once.

But the problem people face getting their teeth done or getting their pension done or paying the bills for later life care are ours today. They are very real, not abstract -like growth. Everything , everywhere all at once is to us, the bad news that we are expecting at the end of the month and it is casing a pall upon our daily work

Turning it round (the counterfactual)

The Government wants us to accept pain today in return for relief tomorrow.  But the pain is not translating into better outcomes, merely plugging an economic black hole (think of the concept and you realise it is more a gaping maw that consume everything).

A friend wrote me yesterday about the quid per quo of employers paying NI on pension contributions

I wondered what this proposal means for supporting the ‘self employed’ in saving for retirement?

Also I wondered what the equivalent contribution to the extra NI would mean in improving members’ outcomes – if it was a contribution increase rather than NI?

Both points are valid. If we are to give up the pension tax privileges of employment (salary exchange being  one) then what is the quid per quo in terms of growth?

Will employers look at cheaper ways of sourcing labour, moving to use contractors because the self-employed do not have the “pension overhead”. Or will everything, everywhere – all at once, mean the self-employed have to pay more national insurance, whether they pay into pension saving schemes or not?

Would employers look at a mandated increase in pension contributions more favorably than a payment of NI , the point of which is lost in the black hole of debt they are told they have inherited from the previous Government?

Pain today, no relief tomorrow

The general despondency that I and others feel about October 30th and the budget is that we are getting no sense of the upside of pain today. There is no sense that big pension problems like the lack of saving of the self-employed, the inadequacy of employer pension contributions, the arrival of a proper way to spend our pots or even a way of seeing our pensions in one place are being addressed.

Instead we are lectured about the need to take immediate medicine and start at the tip of the J-Curve when it comes to investing for the future. Things get worse before they get better is convenient if you think you have a five or ten year time but there are generations of people who do not have 5-10 years to get things sorted. We want and need innovation now and delivery of better outcomes today.

The pain could be acceptable even if the promise was deferred. But there is no such promise or message of hope, no improvement of outcome for us to hold onto. Where is the VFM for our £40bn down payment?

Which is why I am paying off my mortgage rather than investing 25% of my pension pot and it’s why employers are looking at cutting rather than increasing contributions and it’s why many employers will opt-out of employing people, in favor of cheaper short-term contractors.

Because that is what happens when there is a cuts mentality and no articulated vision for the future.

Pain today, no relief tomorrow is no way to bring the country with you, not if you are Emma Reynolds, Wes Streeting or Rachel Reeves. We cannot fear for the future for everything, everywhere and all at once. We want carrot and stick, not carrot with a stick.