Well it looks like Ros and I will be in conversation but I suspect that the usual crew will want to be involved as Ros will be sticking to topics close to her heart and close to ours too.
With typical directness, here is how Ros explained what she wants to talk about
I would like to ask why British pension funds Don’t believe in Britain, refuse to be told they should support long term domestic investments and, unlike other major countries, have been consistently selling and now underweighting, UK markets
Is it acceptable for them to cause the kind of economic damage their actions entail? How long do they think this can last and what will change their evaluation of fiduciary duty?
On that basis I would like us to discuss the proposals I have made to require pension funds which would like Government subsidies to add to individual and employer contributions, to be asked to invest at least 25pc of each new contribution into UK assets. This is the quid pro quo for tax relief to be paid and if any pension managers want to put more than 75pc of peoples contributions in non UK markets or projects, they can do so, they just wont get taxpayer money added.
This is NOT mandation. It is proper incentivisation and makes much better use of the £70billion a year currently added to pension investors by the Exchequer.
What right should pension funds managers and trustees be given to invest to benefit overseas assets, when they are effectively investing such huge amounts of taxpayer money and fail to back Britain with those billions.
Of course you may consider diversification according to market weightings is your way of absolving yourself of fiduciary duty and I have written this morning on what I think of Scottish Widows washing their hands of any responsibility for Britain going forwards
I hope that we will get people who violently disagree with Ros and those like her who take a view on investment allocations.
And if anyone thinks that this is going to be Henry Tapper and Ros Altmann in agreement, I hope we will get on to another subject Ros wants to cover, the issue of inheritance tax on unused pension pots. Regular readers know that the best way for the rich to get round inheritance tax is to use their pension pot as a pension!
If 25% of new money is to be mandated to risk assets that are perceived as underperforming the proposal will fail.
If the funds were directed (at any age) to the purchase of Government issued deferred annuities which are inflation linked and for life, the cash flow would benefit current Government circumstances. ( not deferred temporary annuities which just kick the can down the road)
If this new product could be chosen for further investment by the individual then the impact on current Government planning would be positive