Loan voice: minister for universities David Willetts at the Conservative Party Conference 2013. (Photo: Getty)
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Cashing in pensions, the Baby Boomers inheritance tax, and the bad maths of student fees

Peter Wilby’s First Thoughts.

In 1744, two Church of Scotland ministers, Robert Wallace and Alexander Webster, considered the consequences of premature death among their fellow clergy. They decided that dependants could be provided with annual incomes or annuities if ministers paid yearly premiums during their lifetimes and the money was invested. They just had to get their figures right: costs, investment returns and, crucially, average life expectancy of ministers and their wives. Nothing like it had been done before but the two clergymen got their estimates right to within £1 and, as Niall Ferguson observes in his book The Ascent of Money, modern actuaries still marvel at the precision of their calculations.

This was the origin not only of the Scottish Widows that pays an annuity to me and millions of others but of all modern life insurance – including pensions, which, drawing on the same principles and mathematics, protect us against the risk of longevity. Scottish Widows and other financial outfits have strayed far from their Presbyterian origins and now give most annuity holders a poor deal. However, that is an argument for better regulation, not for destroying, as George Osborne has, a model that has worked well for most of the past 270 years.

The acclaim for Osborne’s Budget announcement that in future people will be able to cash in pension funds at retirement rather than taking out annuities shows how little anybody now understands the principle of mutuality. People complain that they may not “get back” what they put into a pension fund. They are missing the point. You may not get back what you put into car or house insurance; indeed, you hope not to. A pension annuity meets the costs of long life at the expense of those who die early, just as car insurance covers the costs
of accidents at the expense of those who avoid them. It is responsible collective risk-sharing, just like the original Scottish widows scheme, which all 930 ministers then alive agreed to join. Osborne prefers irresponsible individualism.

He says that we can all be trusted to use our money wisely. If so, why have banks – with payment protection schemes, missold pensions, bogus benefits on fee-paying current accounts, and so on – found it easy to rip us off? Osborne offers financial advice for everyone at retirement. Perhaps he should require them to sit a test to show they’ve understood it.

Better off dead

Far from spreading enlightenment on financial matters, the Tories’ habit is to propagate ignorance. Inheritance tax, David Cameron says, “should only really be paid by the rich”. He therefore proposes that the threshold for inheritance tax should rise from £325,000 (in effect, £650,000 for a couple) to nearer £1m (£2m for a couple). The tax was paid in 2010-2011 by only about 6 per cent of estates. At a £1m threshold, the proportion would fall to 1.5 per cent.

Is this another example of an Old Etonian being out of touch with how little most people have? Probably not. It is in the Tory interest to pretend that a tax that hits an elite affects, in Cameron’s words, “people who have worked hard”, a category that almost everybody will think includes them.

Light debts

References to graduates carrying a “debt burden” as they pay back their £9,000-a-year course fees have always irritated me. Though students technically receive “loans” to cover the fees, the government, in practice, pays upfront and later levies a graduate tax that, like most taxes, has a threshold (£21,000 a year), below which there is no liability. If you carry on earning little enough for long enough, your debt is written off. Not many debts work like that; last time I looked, Wonga wasn’t excusing repayments because debtors’ incomes were too low.

Now David Willetts, the universities minister, admits the proportion of graduates who will never repay their full “loans” is approaching 48 per cent. This is bad news for the government, because at that level the benefits of raising fees to £9,000 are cancelled out and ministers show themselves to be worse at maths than 18th-century Scottish clergymen. Surely everyone can now see that graduates don’t carry a debt burden.

Lost cause

A Channel 5 film crew left a seven-year-old and a five-year-old alone and apparently lost in a busy shopping centre to see if adults would come to their aid. With one exception, none did. Is that because we’re uncaring or because we’re scared of being branded as paedophiles? Neither, I suggest. We’ve all learned that if we see something odd in the street it’s most likely some TV or advertising stunt. 

Peter Wilby was editor of the Independent on Sunday from 1995 to 1996 and of the New Statesman from 1998 to 2005. He writes the weekly First Thoughts column for the NS.

This article first appeared in the 03 April 2014 issue of the New Statesman, NEW COLD WAR

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Testing migrant children’s teeth for their age is not only immoral – it doesn’t work

Ministers have flirted with this idea for over a decade. It’s bad policy, as well as poor ethics.

This week, the Home Office finally ruled out the use of x-rays to establish the age of childhood migrants.

It’s welcome news, but this story predates the dispersal of the Calais “Jungle” camp. 

For over ten years, ministers in Conservative and Labour governments have flirted with these tests. And it’s been up to us – the practitioners who’d be expected to administer them – to pick holes in a policy that’s a great way of securing headlines, but simply cannot deliver on the claims made by its cheerleaders.

It goes without saying dentists are health professionals, not border guards. But our objections run deeper than that. And it’s worth revisiting the arguments, just in case future governments start grasping for silver bullets.

It’s ineffective

We can talk about philosophy later, but let’s start with a pretty fundamental objection: dental x-rays are simply not a reliable way of establishing age.

No two mouths are alike. I’ll add my own to that list, as I still sport two of my baby teeth.

Children and young people mature at different rates, so the level of accuracy in these tests changes with time. And these x-rays can estimate age in younger children much more accurately than in adolescents. So as children mature at different rates, the potential margin of error gets ever larger with age.

For example, the third molars, commonly known as wisdom teeth – the last permanent teeth to develop – can form any time between the ages of 16 and 23, and a small proportion of individuals never develop third molars at all (I’ll have to pop my name to that list too).

A 2010 study of 300 young people aged between 11 and 25, whose age was determined based on dental x-rays, showed this method of testing consistently over- or under-estimated age, with a two-year average difference between dental and known age.

So if you are searching for a litmus test that will tell you whether a subject is 17 or 19 years old you won’t find it here.

It’s inappropriate

A few MPs and pundits have found it hard to acknowledge the codes health practitioners sign up to, which make this test a no go.

We must always act in the best interest of our patients when providing a medical procedure. And it is beyond question that the process of radiography is a medical procedure that should be carried out only for medical purposes, and where the patient stands to benefit.

Now many people might not consider this test an invasive procedure. However, x-rays do carry a small risk of possible long-term physical impact, and current best practice in this area dictates that exposure to radiation should be kept as low as reasonably possible over a lifetime. They should be carried out sparingly and where there is a well-defined potential clinical benefit, which must always outweigh the potential clinical harm.

As taking x-rays to determine the age of an individual carries no clinical benefit, it frankly isn’t appropriate to expose a patient to the potential clinical harm it can cause.

It’s unethical

Our lawmakers cannot simply dispense with fundamentals like consent to show they are “taking action”.

It is a legal principle that before practitioners carry out any medical procedure, the recipient – or someone who can consent on their behalf – must be given a full understanding of the nature of the procedure, its significance, impact and potential consequences before signing up to it.

For the children arriving from Calais, this would be a difficult task without English as a first language. Consent may also be required from a suitable adult. Yes, these children may be unaccompanied, but it does not mean the need for valid consent and protecting the child’s best interests can simply be ignored.

The letter of the law might be inconvenient, but it is a requirement that can only be compromised where the urgency and necessity of the circumstances demand rapid action in a patient’s best interests. And even in these circumstances the validity of treatment has sometimes ended up being challenged in the courts.

Given that taking x-rays in order to determine age is not medically justifiable in the first place, the urgency justification really doesn’t come into play. And that means dental colleagues – in the absence of valid consent – could find themselves performing an act that constitutes a criminal battery.


In the past, ministers have debated whether there is a credible “public interest” case that might override these little legal or philosophical objections. But these practical and ethical concerns can’t really be separated.

But why bother constructing a case for a test that frankly isn’t much cop? Dentists can only hope the latest message from the Home Office marks the beginning of a consensus, which draws a line under a decade of wishful thinking.

Judith Husband, Chair of the British Dental Association’s Education, Ethics and the Dental Team Working Group.