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Prospect Pension @prospectpension.bsky.social · 8d

Like the economist who predicted 5 of the last 1 recessions, there are pension experts who have predicted 20 of the last 1 changes to the tax-free lump sum. I think the costs are greater than the benefits (to Treasury). But articles about what someone over the old LTA is doing are unhelpful.

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Prospect Pension @prospectpension.bsky.social · 29d

There are far better ways of getting everyone to pay a fair share than withdrawing or reducing universal benefits. (See, for example, the mess associated with withdrawing child benefit from "rich" parents.)

Prospect Pension @prospectpension.bsky.social · 29d

There seems to be a very long policy cycle of thinking universal benefits are wasteful, increasing means-testing, remembering all the downsides of means-testing, going back to a more universal approach, before thinking universal benefits are too wasteful once again. And we're near the top.

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Prospect Pension @prospectpension.bsky.social · 29d

The winter fuel allowance move was a fiasco precisely because it was such a ham-fisted way of extending means-testing in the pension system (right down to hitting households who should have been protected because we know take-up of means-testing benefits is never 100%).

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Prospect Pension @prospectpension.bsky.social · 29d

I'm afraid that forgetting the lessons from the last time we greatly increased the level of means-testing in the pension system and going back to that approach again, particularly in an AE context now, would be even more bonkers. There are other ways of getting the rich to contribute fairly.

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Prospect Pension @prospectpension.bsky.social · 29d

But the issue isn't average pensioners. It's pensioners who only have the state pension and little else. Saying the triple lock is bonkers now is the same as saying the state pension is too high, which means cutting it for those who rely on it or increasing means-testing. Which are both bonkers too.

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Prospect Pension @prospectpension.bsky.social · 29d

There is a perfectly logical rationale for the triple lock (the non-means-tested safety net for pensioners is too low and needs to be slowly ratcheted up over time). What's bonkers is any suggestion that it can be permanent and the simultaneous erosion of the safety net for non pensioner households.

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Prospect Pension @prospectpension.bsky.social · 29d

I regret to inform you that Mr Record has been at it again. This time in the Telegraph (which seems to be treating the analysis as new despite it being in the Sunday Times last month).

"The Treasury said it did not recognise the figures."

That will be because Neil made them up.

Prospect Pension @prospectpension.bsky.social · Aug 31

There should be a rule about ignoring any article referring to public service pensions as Ponzi schemes. But, to be fair, it's usually not the journalists' fault. And this is not the worst of the genre:

The endless cost of the public sector pension ‘Ponzi scheme’

www.thetimes.com/business-mon...

The endless cost of the public sector pension ‘Ponzi scheme’

With imminent tax rises feared, the gold-plated retirement deals are increasingly hard to justify, says Imogen Tew

www.thetimes.com

Prospect Pension @prospectpension.bsky.social · 29d

Limit pay rises to nurses, fire fighters, refuse collectors and civil servants says man whose own pay, let's just check, yes, whose own pay doubled to more than £10 million!

www.theguardian.com/business/202...

Barclays boss urges UK ministers to limit public sector pay rises

CS Venkatakrishnan also calls for government to avoid bank tax hike as Rachel Reeves seeks to plug fiscal hole

www.theguardian.com

Prospect Pension @prospectpension.bsky.social · Sep 9

Evidence in graphical form that it really is a curse to live in interesting times.

Robin Wigglesworth @robinwigglesworth.ft.com · Sep 9

Sentiment analysis on four decades worth of FT newspaper articles. 🥳 Rreally cool stuff from @joelsuss.ft.com. on.ft.com/4n2TVBq

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Prospect Pension @prospectpension.bsky.social · Sep 5

I'll add you to our "campaign for fair commutation factors" working party ;)

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Prospect Pension @prospectpension.bsky.social · Sep 5

Limiting the tax-free lump for well paid public sector workers would actually increase the value of their (gross) pension benefits! And therefore also increase the reported cost of those schemes. (By limiting how much pension is commuted at the very favourable - to taxpayers - rate of 12:1).

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Prospect Pension @prospectpension.bsky.social · Sep 5

We had members opting out of private sector final salary schemes due to the speculation last year. I had to organise a "don't opt out of your pension scheme due to witless online speculation" webinar to try to deal with the worst areas.

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Prospect Pension @prospectpension.bsky.social · Sep 3

Never in the field of financial services was so much ink spilled by so many about so little.

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Prospect Pension @prospectpension.bsky.social · Sep 3

The official start of "pension tax relief speculation season"! Everyone's favourite time of year...

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Prospect Pension @prospectpension.bsky.social · Sep 1

It would be difficult to make a speech about the LGPS without making lots of sensible points about how it could be improved. But I really don't think that improving the LGPS is his main aim.

Prospect Pension @prospectpension.bsky.social · Sep 1

You didn't find it cliché-riddled guff built on transatlantic-culture-war foundations?

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Prospect Pension @prospectpension.bsky.social · Aug 31

It's certainly not a very useful exercise when the estimates are going in a direction that contradicts the rhetoric of the people using them ;) (Tbf even the NAO have caveated these figures as being pretty useless for years and when auditors tell you to ignore numbers in accounts we should listen!)

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Prospect Pension @prospectpension.bsky.social · Aug 31

If Neil looked at Table 4.3 from the latest OBR release that covered this topic (they are generally updated every other year so these date from 2024) then he would see that gross costs are projected to fall from 1.9% of GDP to 1.4%. We have bigger problems than these schemes.

obr.uk/docs/dlm_upl...

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Prospect Pension @prospectpension.bsky.social · Aug 31

This is why sensible people look to the OBR's long-term fiscal projections in order to judge whether public service pensions (or any other major line of age-related expenditure - like health spending) is on a sustainable path or not. I would urge Neil to be more like these sensible people.

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Prospect Pension @prospectpension.bsky.social · Aug 31

But public service pensions are a major item of public expenditure and should be managed carefully. It's important to have a good idea of what they will cost in the future. But any measure that is apt to halve (or double) over a year is not going to be suitable for this purpose.

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Prospect Pension @prospectpension.bsky.social · Aug 31

It's looking suspiciously like - and please forgive my cynicism for even suggesting it - that Neil's views about public service pension schemes are pretty fixed, regardless of the size of the underlying problem.

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Prospect Pension @prospectpension.bsky.social · Aug 31

So isn't this actually a good news story? Shouldn't Neil be emphasising the halving of these liabilities? Isn't it strange that he draws the same conclusions when we owed £2.5 trillion, as he does after that debt fell to £1.3 trillion in just a year or so?

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Prospect Pension @prospectpension.bsky.social · Aug 31

But... wait... What's this? Last year Neil was complaining that the liabilities of these schemes were £2.5 trillion?

www.gbnews.com/money/state-...

‘Major reform needed’ as taxpayers set to pay £2.5billion pension boost bill for civil servants ‌

The public sector pensions bill hit a record £2.6trillion, making it larger than the size of the UK economy, the latest Treasury figures have shown

www.gbnews.com

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Prospect Pension @prospectpension.bsky.social · Aug 31

The article opens with a bang - the liabilities in these schemes are £1.3 trillion according to Neil Record. He questions the fiscal chops of any government that is profligate enough to allow this on their watch. Tbf it's a serious-looking number.

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