Beltway Briefing

The top five stories from US politics today.

1. Republican frontrunner Mitt Romney has released a new video on unemployment a day after he was criticised as "out of touch" by the Democrats for telling a jobless crowd in Florida that he too was unemployed.

The video, titled 20,000,000 Bumps In The Road, attacks Barack Obama's claim that "there are always going to be bumps on the road to recovery." A seies of unemployed figures in the film declare: "I'm an American, not a bump in the road."

The Romney camp calculated that "President Obama's 20 Million Bumps In The Road Would Stretch From The White House To Los Angeles".

2. Rising GOP star Michele Bachmann has received a poll boost after her impressive performance in Monday's debate. A poll of New Hampshire voters had Bachmann tied for second place with Ron Paul for the Republican presidential nomination.

The survey by Magellan Strategies put frontrunner Mitt Romney on 42 per cent, followed by Paul and Bachmann at 10 per cent each. Sarah Palin is on 7 per cent, with Rudy Giuliani on 6 per cent, although neither has confirmed whether they will enter the race.

Tim Pawlenty received 5 per cent in the poll, followed by Newt Gingrich with 4 per cent, Herman Cain and Jon Huntsman with 3 per cent each, and Rick Santorum with 2 per cent.

28 per cent of those surveyed said that Bachmann gave the strongest performance at this week's debate, with 39 per cent preferring Romney.

3. Sarah Palin has made her first TV appearance since the release of 14,000 emails from her time as Alaska governor.

"It certainly shows the priorities in what was once a respected cornerstone of our democracy, our mainstream media and we see that priorities are quite skewed," said Palin on Fox Business Network's "Freedom Watch". "I hope folks who read the emails learned a lot about energy independence, fish and game conservation, protecting second amendment rights, why I opposed Obama's stimulus package." The emails were released in response to freedom of information requests filed by the media during the 2008 presidential election.

Palin also commented on the downfall of Democratic congressman Anthony Weiner, who resigned his seat after posting lewd photos of himself to women online.

"Anthony Weiner, from henceforth after his personal indiscretions were disclosed, he was going to be rendered impotent basically in Congress and he wasn't going to be effective," she said. "So obviously [resigning] was the right thing to do. Day late dollar short, though. I think he should have resigned when all of this came to light."

4. Republican challenger Tim Pawlenty has admitted that he was wrong not to challenge Mitt Romney over his support for health-care reform at Monday's debate. Pawlenty, who coined the term "ObamneyCare" on Sunday to describe the similarities between Obama's plan and Romney's, told Fox News's Sean Hannity: "I should have been much more clear during the debate ... I don't think we can have a nominee that was involved in the development and construction of ObamaCare and then continues to defend it. And that was the question. I should've answered it directly. Instead I stayed focused on Obama."

The former governor of Minnesota acknowledged his mistake in a tweet on Thursday night.


5. Barack Obama has said that he and his wife Michelle have no plans to have another child in addition to their two daughters. The US President told ABC's Good Morning: "I think Michelle's general view is 'we're done' ".

Obama joked that he's prepared for a crisis in the White House next month - his eldest daughter becoming a teenager. He said: "I understand that teenage-hood is complicated. I should also point out that I have men with guns that surround them, often, and a great incentive for running for reelection is that it means they never get in a car with a boy who had a beer."

Commenting on Anthony Weiner's resignation, Obama said: "I wish Representative Weiner and his lovely wife well ... Obviously, it's been a tough incident for him, but I'm confident that they'll refocus and he'll refocus, and they'll end up being able to bounce back."

George Eaton is political editor of the New Statesman.

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Stability is essential to solve the pension problem

The new chancellor must ensure we have a period of stability for pension policymaking in order for everyone to acclimatise to a new era of personal responsibility in retirement, says 

There was a time when retirement seemed to take care of itself. It was normal to work, retire and then receive the state pension plus a company final salary pension, often a fairly generous figure, which also paid out to a spouse or partner on death.

That normality simply doesn’t exist for most people in 2016. There is much less certainty on what retirement looks like. The genesis of these experiences also starts much earlier. As final salary schemes fall out of favour, the UK is reaching a tipping point where savings in ‘defined contribution’ pension schemes become the most prevalent form of traditional retirement saving.

Saving for a ‘pension’ can mean a multitude of different things and the way your savings are organised can make a big difference to whether or not you are able to do what you planned in your later life – and also how your money is treated once you die.

George Osborne established a place for himself in the canon of personal savings policy through the introduction of ‘freedom and choice’ in pensions in 2015. This changed the rules dramatically, and gave pension income a level of public interest it had never seen before. Effectively the policymakers changed the rules, left the ring and took the ropes with them as we entered a new era of personal responsibility in retirement.

But what difference has that made? Have people changed their plans as a result, and what does 'normal' for retirement income look like now?

Old Mutual Wealth has just released. with YouGov, its third detailed survey of how people in the UK are planning their income needs in retirement. What is becoming clear is that 'normal' looks nothing like it did before. People have adjusted and are operating according to a new normal.

In the new normal, people are reliant on multiple sources of income in retirement, including actively using their home, as more people anticipate downsizing to provide some income. 24 per cent of future retirees have said they would consider releasing value from their home in one way or another.

In the new normal, working beyond your state pension age is no longer seen as drudgery. With increasing longevity, the appeal of keeping busy with work has grown. Almost one-third of future retirees are expecting work to provide some of their income in retirement, with just under half suggesting one of the reasons for doing so would be to maintain social interaction.

The new normal means less binary decision-making. Each choice an individual makes along the way becomes critical, and the answers themselves are less obvious. How do you best invest your savings? Where is the best place for a rainy day fund? How do you want to take income in the future and what happens to your assets when you die?

 An abundance of choices to provide answers to the above questions is good, but too much choice can paralyse decision-making. The new normal requires a plan earlier in life.

All the while, policymakers have continued to give people plenty of things to think about. In the past 12 months alone, the previous chancellor deliberated over whether – and how – to cut pension tax relief for higher earners. The ‘pensions-ISA’ system was mooted as the culmination of a project to hand savers complete control over their retirement savings, while also providing a welcome boost to Treasury coffers in the short term.

During her time as pensions minister, Baroness Altmann voiced her support for the current system of taxing pension income, rather than contributions, indicating a split between the DWP and HM Treasury on the matter. Baroness Altmann’s replacement at the DWP is Richard Harrington. It remains to be seen how much influence he will have and on what side of the camp he sits regarding taxing pensions.

Meanwhile, Philip Hammond has entered the Treasury while our new Prime Minister calls for greater unity. Following a tumultuous time for pensions, a change in tone towards greater unity and cross-department collaboration would be very welcome.

In order for everyone to acclimatise properly to the new normal, the new chancellor should commit to a return to a longer-term, strategic approach to pensions policymaking, enabling all parties, from regulators and providers to customers, to make decisions with confidence that the landscape will not continue to shift as fundamentally as it has in recent times.

Steven Levin is CEO of investment platforms at Old Mutual Wealth.

To view all of Old Mutual Wealth’s retirement reports, visit: products-and-investments/ pensions/pensions2015/