I had a comment made by Baroness Ros Altmann, who was a Tory pensions minister in the closing years of Cameron's premiership, made on the BBC's World at One on Thursday drawn to my attention.
When discussing the problems with pension investment, she made it clear that, in her opinion, it should be made mandatory that pension funds must invest part of their funds in new productive activity inside the UK economy.
When doing so, she then explained that this was a fair bargain to strike in exchange for the £70 billion of tax subsidy provided to such funds and that maybe 25% of all new pension contributions should be required to be invested in this way.
What is surprising is that these are the exact figures and policy recommendations that I included in section 14.2 of the Taxing Wealth Report 2024. I have no idea if she has read this report, but the coincidence would suggest that it is very likely.
Whilst I might not share much in political outlook with Baroness Altman, it was good to find we are in total agreement on this issue, which is incredibly important for the future prosperity of people in the UK.
This clip starts at about 35 minutes in, here.
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Altmann I think is a genuine person who was just used by Cameron to manufacture an image for what turned out to be one of the worst post war (pre-war?) governments in our history.
I was re-reading some of Satyajit Das’ ‘Extreme Money:The Masters of the Universe & The Cult of Risk’ (2011) last night to cheer myself up.
Lamenting how once human beings made things that were useful and authentic, Das creates an image of modern finance as a creating ‘bait ball’ of other people’s money zooming around in chaos as predatory financiers dip in and feed off it so that the bait ball becomes smaller and smaller. What is left is all that it left. That pension money is as vulnerable as those small fish in a bait ball if it goes to the City of London.
It’s a powerful image of just what Reeves’ idea might produce unless the State (in this case a government pleading poverty and no money of its own) is more directly involved with that 25% allocation to that which it says it cannot afford which I agree with wholeheartedly.
I have had some interaction with Baroness Altman during a campaign to get compensation for those who lost their workplace pensions due to company insolvency during the 1997 – 2005 period. She worked tirelessly on their behalf, for no reward and, because she was directly lobbying ministers, could have expected that it would do her career no good at all. The result was the Financial Assistance Scheme and the Pension Protection Fund. Neither would exist today without her contribution. I’m sure that you would have a lot in common should you meet.
Thanks
I am sure we would enjoy exchanging views – and I really do mean that
David Byrne reiterates:
In order to understand the potential problems areas relating to Mega Pension Fund Management, we need to look at what has been happening over the pond. Just Google the subject.
US Pension funds are being shafted by the fund managers, silver suits in Wall Street and Private Equity (PE) Partnerships. The modus operandi appear to be high fees and over-valuation of PE asset investments leading to profit extraction.
Unless there is tough, preventative regulation from the start, Rachel R will turn out to be the sacrificial lamb on her journey to a well paid job in the States.
I would think that the vultures are already hovering and the wolves (of Wall Street) are licking their lips in hopeful anticipation.
I should discuss this in more depth, David. I will get around to it.
David, the USA is salivating over not only being welcomes through the ‘ever wider’ door by Wes Streeting to take NHS services, prepared and paid for by us, but a trade deal that will probably increase the prices of medications/pharma hugely.
It’s all so depressing. I feel so sorry for the young.
Interestingly, your Taxing Wealth Report being readily available means any politician wanting answers has it available and can pretend they thought of a good economic wheeze all by themselves, thus removing the problem of their fevered egos!
Hard on you as the person who put the work in, but at least we’ll know of your efforts: Thank-You!
I don’t care so long as the idea gets out there