I’m frightened to say what I think
–– ROS ALTMANN on the vitriol faced by critics of Brexit Former Pensions Minister tells of the perils of speaking out on Article 50
BARONESS Ros Altmann, one of the loudest voices on the subject of the pensions crisis, has never been a shrinking violet. But the former investments manager, business leader and Pensions Minister admits she is now fearful to speak her mind – on Brexit.
The Article 50 debate has shifted to the House of Lords amid ominous threats from Whitehall sources that the Lords must pass the Bill to quit the EU or face public fury and raise the risk of being abolished.
‘There is so much pressure,’ says Altmann. ‘I have never before in my life been as frightened as I am now about saying what I think.’
She goes on: ‘The thought of speaking out when you get such vitriol back. I don’t know how much of this I am brave enough to put out there. What the hell is going on?’
In the House of Lords overlooking a drizzle-shrouded River Thames, Altmann seems unusually weary. She is convinced the House of Lords must play an active part in the Article 50 debate, but believes the will of MPs should not be frustrated.
‘So what do we do?’ she asked. ‘Well, quite frankly, from a democratic and constitutional point of view, I don’t think the House of Lords has any role to overturn what the House of Commons is doing. So I am not in the camp of saying, “you can’t do it”.
‘But,’ she says with marked emphasis, ‘I do think the role of the Lords is to scrutinise, to advise and to try to stand back and look at what the Commons may have missed and maybe put back to them issues that may be of significant national importance. Isn’t that what Parliament is meant to do?’
This later phrase is uttered with a hint of bewilderment.
Altmann is not a career politician. After working in the City as an investment manager, taking the helm of Saga – the business group aimed at older consumers – she was drafted into Government by David Cameron as a member of the Lords and a Minister at the Department of Work and Pensions.
Once a Labour supporter, she fell out with the party over its pensions policies and at one time was described as a ‘thorn in [Gordon] Brown’s side’.
She now seems exasperated after a year in a Conservative Government. So is she disillusioned with how politics works?
‘Very! Look I had never been a politician before. I was led to believe I was brought in because of my expertise and I would be able to use that. On that basis I thought I would be able to make more headway.
‘The ordinary middle group of people who do not get much representation were the people I was trying to help. To be fair it is a very unusual – I am told – period in politics. In the lead up to the referendum and after, a lot of the business of Government was distorted.’
It is understandable that Altmann
Disillusioned with how politics works? Very! I thought I could use my expertise
The triple lock is a con trick so politicians can say they are doing something...
might be frustrated by the political process. She is a one-woman policy ideas machine. Although she is on the backbenches of the Lords, she fires off almost daily a think-piece – to anyone who will listen – on how to solve the problems of the day.
Her field of expertise is full of problems. The long-standing pensions crisis is now being matched by an emergency over social care as more older people struggle with the cost of obtaining care – both in domestic situations and in homes. Local councils are creaking under the burden.
Altmann has long proposed that pension funds could be liberated in a tax-efficient way to provide some of the tens of thousands of pounds many of us might need for care.
‘Up until very recently the view has been that the insurance industry is going to sort that out, but I think that is just not true,’ she says. ‘The risk is enormous.
‘If you sell an unlimited insurance against needing care, you don’t know how long people will live when you get developments that can help cancer patients or people with dementia. So from an insurance company point of view it will be incredibly expensive.
‘Then we have another problem, which is that the current level of pay for homecare workers is clearly inadequate. At some point we are going to have to pay proper wages. Councils will not pay what it costs – even at the minimum wage – because they have no money.
‘There is no silver bullet. What you need is a combination of initiatives and support.’
Altmann is hoping Chancellor Philip Hammond may at last take up one of her suggestions in his upcoming Budget.
She suggests that people with decent pension funds should be allowed to take an extra slice as a tax-free lump sum if they agree it is ring-fenced and only to be spent on care home fees or similar.
Giving up £50 a week in pension earnings could liberate a £100,000 lump sum to be set aside for care home fees.
SHE began proposing this idea before she went into the Lords and one of her first acts in office was to write a report from the Cabinet Office suggesting this solution to the care crisis. But it never got off the ground.
Altmann quit her Ministerial post in July – soon after the Brexit vote – citing disagreements over the way women’s pensions were being handled, but it is clear she had built up a list of issues over which she disagreed with Government policy.
She has called for the triple lock on pensions to be scrapped and soon after quitting Government she ran headlong into conflict with the Treasury over its Lifetime Isa plans introduced by former Chancellor George Osborne last March.
The Lifetime Isa, available from April this year to anyone between the ages of 18 and 40, comes with a 25 per cent Government-provided bonus on what you save, but must be put towards either buying a first home or paying retirement costs.
Altmann believes it dilutes the message that the best way to pre- pare for old age is by taking out a proper pension. She strongly believes people may be confused about the best route. ‘It throws a spanner in the works,’ she says. Altmann points out that the main beneficiaries will be very wealthy young people who have already filled up their tax-free pension allowance and have now been given another handout by the taxpayer. ‘People will be losers if they use this for their retirement unless they are the top earners and have already used up their pension allowance.’ The pensions industry has been tarnished in recent years by a number of scandals – most prominently that at retail chain BHS. Altmann hopes that any damage that has been done to the idea of workplace pensions is not lasting. ‘I actually think BHS is a pretty exceptional case,’ she says. ‘I don’t think most employers are deliberately trying to underfund their pensions schemes.’ The triple lock – under which the Government has pledged that pensions will rise by either the rate of inflation, growth in average earnings or 2.5 per cent, whichever is highest – is another bugbear. ‘The triple lock is a political con trick,’ she says. ‘It is used as a shorthand way for politicians to say, “of course we are doing something about pensions”. But the fact is that the oldest and poorest pensioners are not triple locked.’ Indeed the triple lock does not benefit those who receive the State Second Pension, Earnings Related State Pension, disability, war veterans, widows or carers’ benefits.
Altmann says she would scrap the 2.5 per cent element, which currently means pensions are rising faster than inflation or average earnings. Instead she would widen the pension benefits that are protected and peg them all to a double lock of either wages or inflation.
‘I absolutely want to protect pensioners,’ she insists. ‘But someone who says the triple lock does not make sense can be portrayed as not wanting to protect pensioners – which is ludicrous.’
Politics again? Altmann glumly agrees.
She also has a beef with the Bank of England. She points out that low interest rates are hurting savers. Meanwhile, a boom for the already-wealthy has been fuelled by quantitative easing under which the Bank injects cash into the system by buying up Government bonds with newly-created money.
Last week, she lambasted National Savings & Investments for cutting its rates. Her view is shared by The Mail on Sunday’s Jeff Prestridge (see Page 92).
But it is clearly Brexit which is playing on her nerves the most.
‘The problem I have got is that this seems to be all about something called politics, which I simply fail to understand,’ she says.
‘I look at things from an economic point of view, from a rational point of view and from a social concern point of view, but something called politics has taken over here. And politics is more about illusion.’