The Conservative Party has spent the last week or so braying about the principle of ‘freedom’. But their noise is all bluster – designed to hide from the public a stark and disappointing fact: George Osborne’s budget was one of the most unprincipled pieces of politicking in recent history.
Even his flagship policy, the scrapping of our near-compulsory pension annuity safety-net, comes unstuck when you look at it properly. He says it is about giving people choice, about setting people free. Of course the annuities market needs reform but for the nearly 6 million public sector workers who live out their vocation in nursing, teaching and local council services, George Osborne has decided ‘freedom’ doesn’t matter after all. Continue reading
The private pensions industry is a colossal financial scandal second only to the banks. It is a staggering fact that charges swallow up 40% of the value of a pension over its lifetime which must make this one of the worst deals ever in the market-place, even by the standards of the inefficient and greedy private market. And even when pension returns are falling sharply, the management greed continues to soar: between 2002-7 the charges levied by pension funds globally rose over 50% whilst the returns going from pension funds to pensioners over rthe same period actually fell three-quarters from 4.1% to 1.1%. 
This week, 1.1 million members of Unison received their ballot papers asking them if they supported strike action in the event of the Government remaining fixed in their position that public service employees must pay more towards their pension, work further years before drawing their pension, and finally receive a smaller pension than had been previously promised. The Government’s argument for this unwholesome menu is that the cost of public pensions is going through the roof, people are living longer so that postponing the age of retirement is inevitable, and anyway Labour left the economy in a terrible mess so that everyone has to grin and bear it whilst taking swingeing cuts. Each of these arguments is is nuts.