Jon Sharp

@FraserNelson @alexburghart Wierd how both the University of Cambridge and the Institute of Actuaries provided formula books 20 years ago. I guess I am just one of the dumb ones …

You can bet private school kids will still be taught and expected to memorise equations. This dumbing down - by ministerial diktat - will only deepen inequality: a case study in the soft bigotry of low expectations.

@Actuarial_Tutor Every data set has its outliers ;-)

Morning, fellow actuaries.

@JohnRalfe1 Do you know precisely how it is structured?

thetimes.com/business/compa… See my quote about the extraordinary (not in a good way) Stagecoach/Aberdeen pension deal, "John Ralfe, the independent pensions consultant, expressed scepticism that everyone would be better off. “It just looks too good to be true"

A move in 10 year yields of 0.07 up and down is not ‘substantial’. That’s about a seventeenth the one day move at the height of the mini-budget crisis.

@David_J_Robbins Always put the most difficult part of the report in the title. It can do the least damage there.

Today's pensions policy paper from HMG is called "Finishing the Job". The 2017 review (unimplemented, now wrapped up in this commission's work, recommendations won't be implemented until 2030 at the earliest) was called "Maintaining the Momentum".

@David_J_Robbins The indices revising to be in line with the actual schemes. Interesting illustration of the disconnect between those working in different silos of the same organisations!

Wow, what happened in November? (Answer is that the PPF revised its Purple Book numbers, as had been expected, and that no index should show a 24 percentage point drop in buyout funding levels in the space of a month.)

@NJM71 Also all the studies show it’s incredibly difficult to implement in practice.

All the talk about means testing the state pension is premature (just my opinion). All major parties know it will be hugely unpopular and generate a ferocious backlash.

99% of people over 66 see the state pension as an "entitlement" not a benefit (perfectly okay) but of course it's an entitlement - you can't claim a benefit you're not entitled to. Being "entitled" to claim a benefit doesn't mean it's not a benefit 🤪 gbnews.com/money/state-pe…

@BritainElects A dark day for Morley separatism!

❗ Reform GAIN from Morley Borough Independents Morley South (Leeds) council by-election result: REF: 36.8% (+36.8) IndGrp: 25.2% (-16.4) LDEM: 17.5% (+13.7) LAB: 11.0% (-19.0) GRN: 5.4% (-3.5) +/- 2023 Estimated turnout: ~32% (+4) andrewteale.me.uk/previews

@paullewismoney Spot on. So many people just say oh means test it with no thought for how this actually works in practice!

I agree

@David_J_Robbins @TorstenBell @CommonsWorkPen :-) re 5. Another consultation, another if you fund like this you will end up over collecting. Ah, well!

Six snippets from @TorstenBell's evidence to @CommonsWorkPen: 1. Tax-free cash speculation: Asked about people withdrawing pensions too quickly on the back of pre-Budget speculation about tax-free cash: "there is a wider question if I'm honest about some advisers and how things were reported... any advisers who advised people to do that should look long and hard at the advice they were providing..." He has a point about sensationalist reporting and about IFAs if any suggested that change was probable (did they?). But his own historic calls for maximum tax-free cash to be slashed and suggestion that the ease of doing so would be a "silver lining" of scrapping the Lifetime Allowance might make repeat scare stories more likely. The speculation also came after an election campaign in which Labour initially declined to rule out anything on tax-free cash . Then, after Sir Keir Starmer mistakenly told a radio phone-in that it was about to expire, the "firm commitment" to keep it (which only came from a press office spokesperson) did not refer to the current maximum. So it's not ridiculous that this was considered a candidate measure for what the Chancellor had said would be a tax-raising Budget. 2. State Pension Age review: wouldn't be drawn on the timing beyond the legal deadline of March 2029. Said the policy aim was to "roughly hold the share of life in retirement constant". That's not much of a constraint when a percentage point on the target percentage of adult life in retirement can change when State Pension Age rises to 68 by a decade. 3. Winter Fuel Payments: Little pre-empting of the announcement. But Government will not restore payments of "a few hundred pounds to millionaires". (Defined how? Including pension wealth/housing wealth/etc.?) 4. Pension adequacy: "Messy lives" and household level analysis will need to be a large part of the review, not just individual-level projections assuming a full career. 5. PPF pre-97 indexation: PPF assets and liabilities featuring on the public sector balance sheet means it's not as simple as saying there is a massive surplus. This implies that the concern is not only about the debt rule (where an immediate liability increase wouldn't matter because only the projected change in more distant future years counts) but the PSNFL level. The Government's claim to this money would be stronger had taxpayers ever stood behind the PPF, and levy payers who overpaid arguably have the strongest claim. Either way, principles for use of the war chest that the PPF was deliberately and understandably trying to build up should have been established years ago - as some of us kept saying at the time... 6. DC investment: It will be for Parliament to decide whether to give the Government reserve powers. These are being proposed as a potential solution to a "collective action problem", whereby providers investing in the ways the government wants to see could be undercut. There will be safeguards - "wait for the Bill". I didn't hear him say long we'd have to wait.

@ProspectPension @David_J_Robbins Also when pre 97 increases were granted inflation was expected to be much higher. Hence, accrual rates offered - I don’t think members have had a lot less than expected

@Pension_Jon @David_J_Robbins That some schemes didn't have pre-97 protection is no argument for taking it away entirely from those that did. The government could just grant protection to those schemes that originally had it. But it would seem very petty to enforce that distinction in today's circumstances.

Even if prices stay flat this month, annual CPI inflation in the year to May would be 3.2%. May is the reference month for PPF compensation increases, so the 2.5% cap on post-97 increases will bite meaningfully. (And calls for pre-97 indexation, about which HMG now sounds less enthusiastic, will be amplified).

@ProspectPension @David_J_Robbins I don’t think you are taking into account that the risk based levy is a significant tax on stressed companies. It has real consequences on plenty of low paid workers. If it was paid from general taxation like the FAS I would be much more sympathetic to your argument

@ProspectPension @David_J_Robbins Let’s not forget, schemes pre 97 design were often 60ths precisely because they weren’t providing inflation increases. And 60ths without increases is much more generous than private sector workers get now.

@Pension_Jon @David_J_Robbins Not the tens of thousands of PPF and FAS members who have had no increases ever on what is often the main part of their retirement income.

@ProspectPension @David_J_Robbins PPF compensation aimed to cover a basic DB benefit. Significant minority didn’t have increases pre 97 hence is a benefit improvement (no reasonable person should think PPF compensation should be a higher benefit than original pension!).

@Pension_Jon @David_J_Robbins You can argue that the overall level of PPF protection is about right, too high or too low (reasonable people can have different views about that). But the lack of indexation of pre-97 rights is grossly unfair and a very poor feature of the design of the scheme.

@NJM71 State pensions aren’t paid for by today’s workers. Workers aren’t the sole source of government revenue.

"Gobsmacked at the amount of scroungers on here". Does that include 13 million pensioners claiming £125 billion a year in state pension - benefits paid for by today's workers? Workers with the highest post-war tax burden are bombarded with toxic views like this from baby boomers.

He’s just doing this to annoy people with 6 April pension scheme valuations isn’t he!

@ActuaryDog I’m worried they will apply tariffs to imports into Excel!

@julianHjessop Where I have seen the numbers for SMEs which have sites that are the size of a school they tend to have pretty rapid paybacks. Biggest issue tends to be grid related red tape.

ps. I'm not saying that this sort of long-term investment can never pay off, just asking for the evidence behind the policy!

Would love to see the cost-benefit analysis that shows it's better to splash £200m on solar panels to make (uncertain) savings to reinvest in public services, rather than just giving £200m to schools and hospitals to spend directly on pupils and patients... 🤔

@meepbobeep What’s your view on Henderson’s Relish?

If you wonder what I do with a gallon of Worcestershire sauce I refill old bottles It’s one of our workaday condiments here Some people put soy sauce on everything… well, this is our equivalent