Rescuing
Democracy in the United Kingdom from our current Elected
Dictatorship
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Spin, not
face-to-face confrontations with the voters, is the Government's
chosen method of communication. Ordinary
people are dangerous. Ordinary people might ask a question
which throws a politician 'off message'; the Cabinet member
might reveal himself or herself to be a human being like
us, and not a programmed android. Worse still, he or she
might tell the truth.
Ann Leslie - Daily Mail, September
16, 2004
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Yawning
pensions divide
Alex
Brummer, Mail City Editor -
February 18, 2005
Private
companies are forced to face up to their pension liabilities
on a daily basis. Across the universe of firms there
has been a retreat from final salary schemes.
This
contrasts with the pubic sector where the government
still offers final salary schemes - even though it has
made no real provision for eventually paying the bills.
New
date from actuaries Watson Wyatt suggests that the unfunded
liabilities of the public sector will reach £690billion
in March this year, which is 60% higher than the government
estimates.
Official
figures put the unfunded liabilities at a more most
£425 billion but this uses an unrealistic assumption
for interest rates and mortality estimates that went
out with the ark. The biggest holes are to found in
unfunded schemes for teachers, NHS, the civil service
and the armed forces. Given the pace at which the public
sector has expanded under Labour, the future charge
on the public finances and eventually the taxpayer can
only become larger.
Yet
when even modest changes in public sector pensions are
proposed - such as raising the retirement age to 65
- there is an outcry among workers. The most common
contention is that teachers and NHS workers are making
financial sacrifices for the nation and deserve comfortable
retirement as compensation for lower pay.
The
Office of National Statistics figures show this to be
stuff and nonsense. Average salaries in the public sector
are actually more than £1.50 an hour higher than
in the private sector where people must pay for their
own pensions.
Wages
in the public sector have been rising far more sharply
than in the wealth-creating business sector. The fact
that a few thousand bosses and entrepreneurs have huge
retirement pots should not detract from the fact that
the vast majority of private sector pensioners will
struggle.
There
is no obligation on the wealth creators to bale out
successive governments that have failed to address public
service pensions in a fair and transparent way.
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Pensions
night-mare that's enough to turn your hair white
by
Alex Brummer, City Editor, Daily Mail - September 8, 2004
Labour's
neglect of the crisis in the pensions system has suddenly blow
up in the Prime Minister's face. Whoever succeeds Andrew Smith,
who resigned as Secretary for Work and Pensions at the weekend,
will be forced to tackle one of the most complex jobs in government
and an agenda which will affect the lives not just of today's
work-force, but of those for generations to come.
The
new pensions overlord, whether it be the ambitious Patricia Hewitt
(who is said to have volunteered for the post) or someone else,
will have to deal with a mountain of unresolved problems. To make
matters worse, they will accede to the job at a time when government
money is becoming increasingly scarce after Labour's five-year
splurge on trying to improve public services.
At
the same time, the patience of middle-income taxpayers has been
stretched to the limit by a combination of direct and hidden taxes
such as stamp duty. A study by financial advisors Smith &
Williamson showed earlier this week that this group is paying
50% of its annual income in taxes and government charges. Yet
the gaping hole in the public finances means the next government
will have to impose hefty new tax rises or take a meat axe to
public spending. As a result, there is little in the way of government
resources available to deal with the new problems bubbling up
on the pensions frontline.
DEFICIT
New
data suggests nine million women potentially face pensions poverty.
In addition, the Government has still failed to come to grips
with the loss of pension rights for future retirees in troubled
firms such as asbestos giant Turner and Newall. Indeed, the fear
must be that the Pensions Bill before Parliament - which seeks
to rescue pensioners in schemes which go bust - could undermine
the safety of solvent company retirement funds.
The
whole history of Labour's stewardship of the nations's pensions
structure gives the lie to Tony Blair's promises of 'joined-up
government'. The Treasury's decision to raid corporate pension
schemes by removing the tax relief on dividends helped to open
a chasm in company schemes. Figures put the deficit in the retirement
funds of the top FTSE 100 companies alone at £57billion.
To encourage pensions saving among lower-income workers, the government
set up the so-called 'stakeholder pensions' plan.
But,
about the same time, it introduced the means-tested 'pensions
credit' designed to help hard-pressed retirees. This generous
scheme, already costing taxpayers billions, means it makes no
sense for anyone earning less than £30,000 a year to provide
for themselves through the stakeholder plan.
The
result: one initiative has negated the effectiveness of another
and left the taxpayer with a huge potential liability.
Worse
is to come. Changes are on the way which will fundamentally alter
the manner in which company pensions, which still protect 60%
of Britain's work-force, are managed. And the law of unintended
consequences points to the reforms weakening rather than strengthening,
Britain's retirement system.
The
first change is contained in the new Pensions Bill. This seeks
to help future retirees in companies which go to the wall by setting
up a protection fund. The aim of this rescue scheme is wholly
honourable. But the burden of plugging the gap falls not on the
taxpayer, but on the private pensions industry, with the biggest
firms picking up the tab.
This
would not matter if these firms' pensions funds were in good shape.
However, many - including such august names as British Airways,
ICI, and defence manufacturer BAe Systems - already have serious
shortfalls in their pension funds without taking on the burdens
of companies in meltdown. In fact, the proposed recent takeovers
of two famous High Street names (WH Smith and M&S) failed
because of concern about existing pension deficits, before
any calls for rescue funds are made.
SCANDALS
The
actuarial firm Lane Clark & Peacock estimates that, as a result
of new obligations, the underlying pension fund deficit for the
Footsie firms would more than double to £125billion. Meanwhile,
a second looking problem is a further change in accounting regulation
which arises from Enron and other financial scandals in the US.
As a result, Britain, ironically with the support of Patricia
Hewitt, in her post as Trade Secretary, will be obliged to implement
new International Financial Reporting Standards. These will add
to the currently published deficits and further weaken company
pension schemes.
The
third and final worrying change is the re-writing of the mortality
tables used by actuaries in assessing the solvency of pension
funds. It is, of course, no secret that people are living longer.
But increased longevity has not been built into pension calculations.
city investment Bank, JP Morgan estimates that, within five years,
this will add £23billion to the cash requirements of Britain's
top 100 companies. The challenge of restoring Britain's system
of private pensions to health is a huge one.
DISGUISED
Perhaps
the answer lies with the Pensions Commission established by Tony
Blair and headed by Adair Turner, former director-general of the
CBI. Turner has been investigating the vexed political question
of whether pensions saving by employees should be compulsory -
as it is in other countries, including Australia. A recommendation
for mandatory pensions saving by every working person was first
made by Labour maverick, Frank Field - the man who was asked by
Tony Blair to 'think the unthinkable' during Labour's first term
and, when he did so, was summarily sacked.
Now.
the issue is back to haunt the Government, as it has become increasingly
clear that company pension schemes are becoming less robust. Yet
no Labour minister wants to be the one who forces every employee,
however poorly paid, into a company pension scheme. For many people
believe such a move would be unnecessary because they already
pay for retirement through National Insurance.
The
reality is the NI contributions are no more than disguised income
tax. The payments, like tax revenues, go into general government
funds to pay for all manner of services. They bear little relationship
to future state pensions.
Mandatory
saving in an employer's pension scheme would be seen by many as
another stealth tax, even though it could be essential to keeping
future retirement funds solvent. The brave politician who bites
this particular bullet will risk no only their own career but
that of the whole government. This was not a challenge Andrew
Smith was ready to take on.
But
there should be no mistaking the direction in which the nation
is heading.
For
the health of our democracy, we, the people of the United Kingdom,
must find a way to force Mr Blair to resign
Such
defiance of the democratic process and the will of the majority
of we people of the UK, must be exposed by voters as a matter
or urgency, and not just in the two by-elections we have had this
July and the European elections in June 2004. But how can this
be done?
The
most effective way of getting our deceitful PM to resign would
be to mobilise the army of Labour MPs currently in the House of
Commons and get them to demand it, the loss of their seat to be
a penalty if they did not. All voters in Labour-held constituencies
need to write a letter along these lines to their local Labour
MPs:
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Dear
Despite
his absolute and unequivocal assurances over the past
year of the serious risk to our security of Saddam
Hussein's 'weapons of mass destruction', Prime Minister
Blair has admitted, that the threat was non-existent.
For that critical error of judgement and for his gross
incompetence in handling this very important issue,
I ask you to take immediate steps to ensure that Tony
Blair does the honourable thing and resign without
delay..
I
would therefore be much obliged if you would propose
and help mobilise a Parliamentary vote of 'No Confidence'
in Mr Blair which, despite Labour's huge majority,
would leave the PM with no option but to resign.
If
I get no reply to this letter, I shall assume you
will continue to support Mr Blair as our Prime Minister.
In such circumstances I shall not vote for you in
the forthcoming General Election.
Signed:
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Simple,
non-violent, protest letters along these lines on a variety of
issues could be the basis for re-vitalising our democracy and
increasing voters' interest and participation in politics. Download
a printable copy of the above letter here.
There
is another way for the voice of the silent majority to be heard,
a voice that made sure broken promises would not only be revealed,
but punished in subsequent elections.
In
the year available before the General Election expected in 2005,
many topics are available as ammunition, each one asking questions.
A weapon for our purpose will be the results of Opinion Polls
in individual constituencies using ICM, NOP, Gallop, Mori
or YouGov.
Questions
suggested for this purpose are listed here.
CAST
YOUR VOTE ON A VARIETY OF OTHER IMPORTANT ISSUES HERE.
Current
and prospective Parliamentary candidates of all Parties running
for election could share a platform at public forums in every
constituency. They would be presented with the results of
polls on this issue expressed by the majority of voters in that
constituency.
The candidates could be asked if their own views and that of their
Party manifesto corresponded with the polls, and if not, how they
intended to represent the will of the majority of local voters.
Local and National Press, Radio and TV coverage would be arranged
and the results published on this web site.
Here
is another powerful strategy for using your vote effectively in
the forthcoming General Election. Send your sitting and prospective
MPs a letter defining your requirements if they want your vote.
This example deals with the proposed
EU Constitutional Treaty.
Your
letters would end: "If you do not answer
this letter, I shall take it that you intend to follow the Government
line. I shall act accordingly in the forthcoming General Election.
Or
why not create a questionnaire that you send to all the candidates
in your constituency, getting them to give yes/no answers to questions
of your choice, and ending it with the same paragraph(above).
Download
a printable example of the questionnaire.
It
is high time for the people of this United Kingdom to stop allowing
themselves to be manipulated by politicians. We need our representatives
in Parliament to genuinely reflect the view of the majority in
their own constituency, even if this means going against their
personal and/or their party's policy. While they may argue their
case, hoping to change the minds of the majority in their constituency,
they should ultimately be obliged to reflect the majority view
of those who elect them.
It
will be argued by politicians of all parties that most voters
don't have the knowledge necessary to express an opinion on important
subjects at issue, and that our vote is a form of delegated democracy.
We should argue that it is their duty to ensure that we voters
do have ready access to such information as is necessary to form
an intelligent opinion. That, after all, is one main purpose of
Opposition Parties in our Parliamentary Democracy.
Most
important of all, such proceedings would rekindle in voters their
latent interest and obligation to cast their vote, knowing that
the candidate of their choice would be more likely to act in accordance
with their wishes. A much higher turnout in elections would be
the result.
Contact
your local Party Chairman. Gain his support for setting up public
forums in your constituency on these, as well as any other relevant
topics, well before the next General Election expected in 2005.
You should then, depending on the integrity of the candidate of
your choice, feel fairly certain that your view on any subject
being debated in Parliament will more accurately be reflected
by your representative in that assembly.
