Ed Miliband, and his wife Justine, leave after voting in the local and European elections at Sutton Village Hall this morning. Photograph: Getty Images.
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Why a strong result in the local elections is so important for Labour

The party needs large gains to demonstrate that it can win the general election and to compensate for possible defeat to Ukip in the Europeans. 

For months in Westminster it was assumed that David Cameron would be the leader under pressure on the day of the European and local elections. The prospect of the Tories being beaten by Ukip and finishing third in a national election for the first time was expected to send his party into a tailspin. But today, against expectations, it is Ed Miliband who faces the greatest challenge. 

Weeks of careful expectation management have ensured that a third-place finish in the Europeans has been priced into Cameron's political share price, with potential rebels appeased in advance. Over the same period, the narrowing of the national polls has reassured Conservative MPs that they can win the next general election, while inspiring fear among their Labour counterparts. "We’ve been defying gravity and now we’re falling to earth," one of Miliband's MPs tells me in my politics column this week. 

Among the PLP and some shadow cabinet members, there is consternation at what many regard as the party's failure to take the attack to Ukip earlier in the campaign. Others have been dismayed by a campaign that included the much-derided "Un-credible Shrinking Man" election broadcast and a poster erroneously attacking the coalition for raising VAT on food (which is exempt). Miliband has announced no shortage of radical policies - the banning of exploitative zero-hours contracts, a cap on rent increases, a 48-hour GP guarantee, the linking of the minimum wage to median earnings - but many feel these have been undersold by the party at large and, in particular, the shadow cabinet. One MP told me that some members had effectively "gone on strike". 

For all of these reasons, a good result in today's elections, and the locals in particular, is essential. Should Labour be beaten by Ukip in the Europeans, becoming the first main opposition party not to win the contest since 1984, the party's strategists will note that the election is rarely a reliable indicator of the general election result and often produces anomalous outcomes. In 1989, the Greens finished third with 15 per cent of the vote. In 1999, the Tories won the contest but suffered a landslide defeat to Labour two years later. Ukip won 16 per cent of the vote in 2004 and 17 per cent in 2009 but polled just 2 and 3 per cent at the subsequent general elections. Defeat to Farage's party in what David Axelrod calls the "age of alienation" does not mean Labour cannot triumph in 2015.

But in order to make this argument convincingly, the party needs a strong result in the locals. Labour's test of choice is how well it performs in those seats it needs to win to achieve a majority next year. It is here, one strategist tells me, that the party has concentrated its field resources, which allowed it to win a "1992 share of seats on a 1987 share of the vote" in 2010.

In an attempt to manage expectations, Labour says that "a good night" would see it gain 150-200 seats (and 25 per cent of the vote in the Euros). But the pollster John Curtice argues that nothing less than gains of 475-500 is acceptable for the main opposition party at this stage of the electoral cycle.

Today, Labour needs a strong result both to demonstrate that it can win the general election and to act as a firewall against the backlash that would follow defeat to Ukip in the Euros. 

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: www.oldmutualwealth.co.uk/ products-and-investments/ pensions/pensions2015/