In defence of Ed Miliband (and Maurice Glasman)

It's time to stop looking at today's politics through the lens of the 1980s and 1990s, Blairite and

We live in perplexing political times. Ed Miliband delivers a conference speech praising the best of British business in the highest possible terms, and is dismissed by so-called Labour bloggers as an anti-business leader. Long-time anti-racist campaigner Diane Abbott is denounced on national television for racial stereotyping through Twitter. And now Maurice Glasman writes an article for the New Statesman calling on Miliband to deploy the gifts that only he can deploy, and is roundly condemned for turning against his own leader.

There are, of course, some standard explanations for these confusions. We live with a press that loves nothing more than an internal party dispute. Journalists, bloggers and tweeters all long for challenges to authority, even for a frenzied leadership election of the sort that brought down many a Tory leader in the last two decades. And perhaps our politicians should chose their words more cautiously as a result.

But there is something more fundamental going on too.

Our politics is in flux and confusion is the almost inevitable result. The flux is the direct consequence of the crash of 2008. That event did not just bring over a decade of Labour government to its end, it also displayed the bankruptcy of a political, social and economic order that began in the 1980s and continued unabated through the premierships of Tony Blair and Gordon Brown.

That order sometimes goes by the misleading name of "neo-liberalism." But it was much more straightforward than the technical jargon suggests. It was an order premised on the idea that the financial might of the City of London would power economic growth in the UK so long as it was left essentially unfettered by the demands of normal democratic politics.

The tax revenues that then flowed from the City would prop up the rest of the country, either by supporting employment through public sector expansion or by provided a financial guarantee for welfare benefits. Labour opposed this order in its early days. But it eventually largely capitulated to it. In the Party's "New Labour" formation, it openly committed itself to maintaining the same order, just running it more efficiently and more equitably than the Conservatives had.

The crash brought all of this to an end.

Nobody now can seriously deny that our politics cannot be run like that anymore. Any objective observer of our situation would accept the need to "rebalance" our economy, to transform our national provision of skills and training, to open up access to capital for small and medium size businesses across the country, to find a way of ensuring real and sustainable private sector growth.

But even if our situation should be clear, Ed Miliband is the single political leader who has consistently demonstrated that he really appreciates just how significant a change Britain's new situation demands.

He was the first to identify the dangers our economic malaise posed not just to the poor but to the vast middle class of our country. He was the first to call for a new culture of responsibility, not just among those dependent on benefits but on those in our boardrooms and among our nation's shareholders. He was the first to highlight both the moral evil and the economic stupidity of runaway executive pay.

Such far-reaching calls for change scare people. Most clearly, they scare some members of our political class and our commentariat who would prefer things to go back to the way they were. There are always going to be some people who long for the familiar tussles of the past, who feel they understood the minor differences between a Blair and a Brown, or even a Blair and a Thatcher.

They understand our contemporary politics through the lens of the 1980s and the 1990s. And everything is classified in the terms that those decades presented: pro-business or anti-business; pro-public sector or anti-public sector; pro-privatisation or anti-privatisation; Blairite or Brownite.

But this is to make a terrible error. Our politics is necessarily different now. The choices are not the same. Our hope remains, of course, but our aspirations are necessarily chastened by the experience of the crash.

As Miliband reminded us in his New Year message, Labour must now offer a programme for social justice suitable for austere times, not for times of boom. That will require imaginative thinking, tough decisions and, most importantly of all, real political courage. When someone points that out -- whoever they may be -- it should not be taken as a sign of contemporary disloyalty nor a treacherous abandonment of the achievements of the past, but as an appreciation of the seriousness of the situation that we face. If our politicians do not have the courage to face the challenge head-on, then it will be our country that suffers as a result.

Marc Stears is Visiting Fellow at IPPR and Professor of Political Theory at Oxford.

Marc Stears is fellow in politics, University College, Oxford and visiting fellow at IPPR.

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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/