Well, every now and then you get an e-mail that cheers you up, don’t you?
I have just got one from the editor of Money Marketing asking for an Inside Edge piece on the topic: Do we need a pensions minister? Hmmm. I will assume it is a serious question.
I think we probably do if only because we have become so used to having them. Since the current Government came to power, we have had five already, six if you count the vacant seat we have at the moment. Six in six years is getting close to being habit forming, so we will need some careful weaning off them if we are to go without.
The number of pensions ministers we have had, in fact, is nearly three times the number of pensions Green Papers we have had in that period and that is quite a record. (For anyone who is sad enough to care, they were Frank Field, although he was technically minister of state for welfare reform, John Denham, Stephen Timms, Jeff Rooker and Ian McCartney. The ministers, that is, not the Green Papers.)
The first Green Paper was a biggy and turned out to be a three to four-minister job. Sort of a “How many ministers does it take to launch a stakeholder pension?” kind of thing.
But that job was nowhere near as difficult as the one that this Green Paper is turning out to be. Oh no. My gut feeling is we will need more for this one.
What is happening this time is the simplification of the whole pension system no less, 45 years worth of corporate and individual red tape being tidied up once and for all. More than one minister and a vacant seat can cope with, I should have thought.
OK, that is a bit unfair and there are a hell of a lot more people involved than just the pensions minister. There are plenty of good people beavering away in the background making sure the retrospective changes proposed by the Inland Revenue dovetail exactly with (hopefully) similarly radical changes that we still haven not seen any details of from the Department for Work and Pensions. The ultimate goal, a single tax regime for all that is simple to understand, is within our grasp at last. Historic stuff. We have had a very busy time of it for many months now, all of us engaged in the most important and far-reaching consultation on pensions we have ever seen.
Don't forget, this is being done against a backdrop of unprecedented change in the pensions markets. We have recently seen an alarming number of closures of final-salary schemes, the almost complete failure of the new stakeholder workplace-based schemes to take off and a massive increase in the provision of means-tested retirement benefits to act as a disincentive to saving in the first place.
As if that is not all worrying enough, we have also seen the emergence of pension black holes in company accounts, the ‘worsening’ of annuity rates and what can only be described as an epidemic of pensions bad news stories in the press. On top of this, of course, the stockmarket having gone to hell in a handcart has not really helped matters either.
Someone needs to get hold of this, I think. It is sort of a bus thing. People seem to find it quite reassuring when they get on a bus to see a driver at the wheel, doubly so if he gives the impression that he knows where he is going. Little things like that stop people worrying unnecessarily. I mean, I would do it myself if I weren’t so busy at the moment, what with all the consultation papers and all.
First published in Money Marketing, 29 May 2003