Michael Johnson on…
“I got the job not because I was a member of the party but because I am somebody who can organise things. It does not mean I vote Conservative”
Nest: “I would get rid of it. Do something similar, but not another government-centric quango. It is probably going to cost £600m or £700m and it could largely be done by the private sector anyway.
Risk-sharing: “There is a huge future for probably 90 per cent of workers saving in a default fund environment that has a lot of elements that look like a with profits fund. We really want a sovereign with profits fund that is a sovereign welfare fund. Nest needs some reasons to exist. It could be the guardian of the nation’s sovereign welfare fund, a series of giant default funds. And pension provision would be driven by the performance of the sovereign wealth fund. This would generally reflect Osborne’s very early statement that “we are all in this together” because if the nations’ sovereign wealth fund does well then pensions do well, and if it does badly they do less well.
Public sector pensions: “Clearly something has to give. I envisage that we will probably end up with a hybrid world where there is a certain level with a fairly hard promise and above that there is a DC pit and the question is where does that level lie. One of the reasons Nest could exist would be if you compelled all of the public sector to participate in it.
Means-testing: “If you put state pension up to guarantee credit level slowly you are taking yourself out of the means-tested benefit melee and you create a virtuous circle. As you take people out by raising the state pension, the £8.6bn of pension credit payment collapses so you are suddenly freeing up the bulk of £8.6 billion per year which you can put straight back into the basic state pension and can raise it again. And you save on all the admin costs. I am working on a cunning plan with Patricia Hollis on this at the moment.
Political affiliations: “I consider myself to be apolitical. It is actually a disadvantage having had a job running Cameron’s policy group. I got the job not because I was a member of the party but because I am somebody who can organise things. It does not mean I vote Conservative.