Lord Myners\’ master plan is for the Government to get involved. People would buy their annuity from the Treasury\’s Debt Management Office (DMO), which sells gilts for the Government. The DMO would insure the risk and provide an annuity through National Savings & Investments, another government agency. The pension payments would be made through the Post Office.
We\’ve spent decades trying to get people to save for their pensions.
Now, at the last gasp, at the vinegar stroke, we\’re going to load all of the risks and liabilities of those pensions onto the State.
And oh my God doesn\’t it leave room for some future Chancellor to play games with the payouts?
The State does not have any liability for pensions. They don’t for any debt. They control the courts, the police and the Army. It doesn’t matter what they promise, they don’t mean it and they are not bound by it.
What he means, I assume, is that they want to do what the US did which is spend all the money that idiots have saved through this scheme and leave nothing but a pile of useless IOUs. A tax by any other name.
This is forcing us to buy Gumment debt. AND, since its an annuity, we don’t get our money back at the end…I’d rather buy premium bonds.
It is alleged that the mess that the French government got into by selling mispriced annuities was a major contributory factor to the French Revolution. The British avoided financial collapse by inventing actuaries and life assurance companies.
The question is whether Lord Myners is ignorant of history, which is forgiveable, or whether he is not and deliberately proposing replacing the remedy with the disease.
Isn’t something like 50% of UK private pension assets already invested in gilts?
Hang on. Nu-Labour politician suggests insane faux-socialist statist and economically dubious idea to Cleggalition? We’re just lucky he had the idea now rather than 5 years ago.
Irrelevant – although, I suspect, untrue. However, the argument is about what happens when you are forced to realise your pension income rather than while you are building up your pension pot.
How does this differ from other schemes for raiding pensions – like Murphy’s idea of forcing pensions to invest in green schemes and local regeneration?
Don’t we have State annuities in the form of the State Old Age Pension already ?