REPOST: The Pig Has It

In honour of the appalling cover to Professional Pensions, 27 March 2014, here's a repost of an earlier blog:

Go onto Google Images, type in ‘pension’ and then see what comes up. Actually, I can tell you what comes up. Ignoring news stories, in the first 100 or so images there were 10 pictures of cash in a jar, 19 ‘beautiful couples’, 12 eggs in and out of baskets, 4 moneyboxes, 6 road signs and a few deckchairs. And twenty-three piggybanks. That's right. Twenty-three pigs.

Is that the best we can do?! Is that a good summary of our ability to convey ‘pensions’ in pictures? You see, if you go behind the picture on Google, to the sites, they almost all lead to providers, consultants and clients pension funds.

Surely we can be more imaginative than a piggy bank? If a picture paints a thousand words, aren’t we falling a bit short with coins in a jar? So come on AHC, Likeminds, Shilling, Ferrier Pearce and all you other pension communication companies…..not to mention the internal departments in actuarial firms…. where are the new ideas? What can we convey that doesn’t include a piggy bank held in the hands of a beautiful couple in a deckchair under a road sign?!

Pensions Poverty

I welcome the budget changes to pensions. I really do. But the truth is, it’s benefits for the privileged offered by the privileged (to misquote Ed Milliband). Here’s a Facebook message that was posted today by Monika, a lady in my church:

Dear George Osborne,

I'm glad that future pensioners will be able to draw down their annuities and that people with the money to spare can put more of it into ISA's and that, probably those same pensioners can save via a Pensioner's Bond.

But please explain where those pensioners with little, or no, spare cash will be better off.

Personally, when I was a single working mother, I saved what I could in an annuity, only to find out when I retired, that, as it did not amount to £23,000 I was not allowed to withdraw it and had to receive an annuity of, wait for it, £12 a year (!). Even if I live to 100+ I'll never be able to draw out what I put in and now, because I've already retired, it's still locked away.

It seems to me that many pensioners will still not be any better off, despite the media's proclamations, so don't be surprised if you don't get my vote in the next general Election.

Her comments are pretty typical of the real issues we face. Pensions poverty is real.

And what’s worse, according to the Institute of Economic Affairs, we can’t do much about it either. They advise that promises made by successive governments have not been honoured from the existing tax base. So we can’t afford to pay what we’ve promised to pay, and according to IEA’s Philip Booth, ‘it is quite possible that we will not find our way through without serious social breakdown’.

That’s the sobering message behind the mild euphoria in the pensions industry provoked by yesterday’s budget announcements.