columnibus

Tuesday columns for Newcastle Journal by George Hepburn

Month: March, 2014

Why the Lamborghini pensioners’ finances could go off the road

I am one of the lucky ones.  I can buy a Lamborghini. I am slightly surprised that the government has not recommended a British luxury car, but never mind.

Lamborghini should be worried.  The rush of pensioners buying  luxury cars with their freed up pensions, as suggested by Pensions Minister Steve Webb,  will not help their marque as the preserve of the fast and glamorous. The need for replacement bumpers and wings may however increase once the grey haired get behind the wheel.

If I offer you a lift in my new car, as you emerge from  the pubs and bingo halls allegedly beloved of hard working people, you may well point out that I will regret my extravagance when I cannot afford a nursing home in the years to come.

I will reply that I listened very carefully to the free and independent advice thoughtfully provided with government funds to help me decide how to use the newly given freedom to spend my pension pot. ( I always associate pot with another word beginning with p and cannot take the term seriously).

The free advice service could be a boon to the hard strapped Citizens Advice Bureau but I fear a new phalanx of supposedly independent advisors will emerge, rather like those who mis sold pensions back in the nineties. That episode led to disciplinary action against 345 firms and compensation of £9bn.

I was taken aback that the government recommended a particular brand of car. The emerging political philosophy is one of free choice in which we elder people, who have saved hard all our working lives, are deemed to be responsible enough to make our own choices.

I don’t mind. I will settle for a Lamborghini and make a responsible decision about what colour to choose. Do they make a model, I wonder, with a hoist to lower me into the driving  seat and with extra wide doors to hold a wheelchair in the back?

The Chancellor must reckon that we are smarter than our cousins in Australia who already have the freedom on how to  spend their pension funds. About two thirds use the money to buy a house, pay off loans, get a car ( brand unspecified) or have a holiday. Only 1:25 purchases an annuity.  

George Osborne  has pulled a reckless fast one  without any consultation which may turn out to undermine the collective insurance principle that allows pensioners to buy an income for the rest of their lives.

“We have to believe in freewill”, IsAac Bashevis Singer tell us, “ we’ve got no other choice”. Frankly, I am daunted by the choice ahead of me. It involves reckoning how long I will live.  I  hope liberalisation will  wake up  the insurance industry to improve their annuity products. It may be a  vote winner  but I fear the policy may boomerang in twenty years time as a lot of impoverished old people sup their even cheaper beer.

Neil Trotter could buy 300 Lamborghinis with his £100m winnings on the lottery last week or goodness knows how many Robin Reliants. The poor chap must have been the butt of  many Del Boy jokes but has got the last laugh. “Being Trotters, we were always going to be millionaires one day” he told the press.

Neil is a motor racing enthusiast who now  fancies buying a McLaren or two. Does he realise that at 745th place, he  has hardly broken into the rich list?   Forbes magazine cites the five richest people in the country as being worth an average £5bn each.  

The lucky five include two aristocrats with the good fortune to have the best properties on the monopoly board. The Duke of Westminster owns Mayfair and the Earl of Cadogan owns Chelsea and Knightsbridge

There are two sets of the brothers, the Reubens  and the Hindujas,  who have both largely made their own fortunes and, at number five, our own, our very own, Mike Ashley. At £3.3bn, Mike could buy 10,000 Lamborghinis, assuming a slight discount on a bulk order.

It would be more in character for him to buy the whole factory and give the beautiful beasts pride of place on his shop floors. Current worldwide sales are shy of 2000 cars a years but may be boosted by a new model, the Huracan, due out this year and would benefit further from  Mike’s marketing skills.

You have to admire Mike Ashley’s extraordinary rags to riches success. Newcastle United cost him the equivalent of 500 Lamborghinis by the way.

The moral of this column is not to decry the accumulation of hard earned wealth but  to point out the increased gulf between the rich and the poor as measured by motor cars. Forget the twelve side coin, the new currency is Lambinis.

According to a report from Oxfam published last week  “the five richest families in the UK are wealthier than the bottom 20 per cent of the entire population. That’s just five households with more money than 12.6 million people – almost the same as the number of people living below the poverty line in the UK. “

What’s more, the gap is increasing. To quote Oxfam again “Since 2003 the majority of the British public (95%) have seen a 12% real terms drop in their disposable income after housing costs, while the richest 5% of the population have seen their disposable income increase.” ( A Tale of Two Britains  oxfam.org.uk/publications )

We know that inequality is bad for all of us. Britain has the second highest level of inequality of any OECD nation. The Equality Trust  calculates that if inequality reduced to the average of these countries, we would save £39bn a year in the costs of health services and imprisonment. Life expectancy would increase for which I would need a pension.

The Chancellor should reflect that a  more equal society makes everyone happier. It even reduces the chance of my Lamborghini having a nasty scratch along the side in the morning.

George Hepburn is proprietor of Bewick House Enterprises  http://www.bewickhouse.com

 

 

 

Advertisements

What a shame that we just don’t make a meal of lunch these days

Lunch at The Sausage Emporium was the highlight of my week.  For an establishment that really only has one product, it has an amazingly varied menu which is delivered with panache in a brilliantly renovated railway arch by Central Station.

It was a gentlemen’s lunch at the invitation of an old friend who, with a year or so’s seniority, gently helped come to terms with life in the twilight zone without a full time job. We both agreed that the pleasure of attending silver screen performances was compromised by fellow cinema goers who were obviously so much older than ourselves.

I am rarely seen in the dining rooms of town these days. At least one good trencherman’s retreat has just closed down, presumably because of the lack of my patronage. At others, the maître d’s leap up to welcome me as a long lost friend.  I have even been offered a complimentary aperitif with the sure knowledge that it will help my eye run down to the pricy end of the menu.

The art of lunching is not practiced with such consummate skill as of yesteryear. When I worked in Newcastle, a business lunch was the business. It need not cost a fortune. For many years, I could slide  out of the back door of the office into a modestly priced  bistro on Akenside Hill.

Lunch defines a period of time in which get to know each other, lament the trials and tribulations of the football club and even gossip. Above all, the lunch ensures you have a captive audience right down to the coffee and mints with  sufficient time to conclude your deal. There is an ambience about eating together that is rarely achieved in the office.

On the few occasions I was entertained as the Northern Counties Club, there was always a camaraderie amongst the members that must have added a special ingredient to professional life in the town.

Something has been lost with the advent of ‘food on the go’ and Costa coffee, bought in a rush and consumed at the computer. Lunch is no longer a relationship experience or a breathing space to reflect and revive.

Like my more famous name sake, the Chancellor of the Exchequer, I am aware of the dangers of excessive lunching. George Osborne has apparently followed my example and adopted the five two diet because of the intense demands of his working life on his stomach. “Have another canapé, Chancellor”, must be a common cry in the City boardrooms he frequents.

The great thing about this fashionable fast diet, adopted by Beyonce, is that providing you restrict yourself to 600 calories  on two days a week, you can  cram in as many canapés as you like on the remaining five days. You can also move the fasting days to suit your diary.

As I chew slowly away at a single forest fruit yoghurt break ( 74 calories) for my lunch, washed down with a black coffee, I reflect that I still never really get intense or prolonged pangs of hunger even on a fasting day.  A camel can live off its hump.

Most of us do not go hungry but I rather hope that fasting  will give George Osborne food for thought as he prepares for the Budget next week. He might try living off a food bank parcel for three days by limiting his food costs to £14.30. He could announce a pledge to join  the national day of fasting from the dispatch box planned for Friday April 4th. (sign up at endhungerfast.co.uk).

In the Christian calendar, it is the time of year to fast. Last Tuesday, all the fattening foods in the cupboard were turned into  pancakes  and the 40 days of abstinence in Lent kicked in. Christians try to follow the example of Jesus who fasted for 40 days in the desert and was then tempted by the devil.

The Revd Keith Hebden from Mansfield  is going the whole hog  and living off water for forty days as a protest against food  poverty   but the rest of us are more likely to give up something symbolic and naughty like chocolate or alcohol.

We also try to  think more  deeply during Lent about  what really matters to us. On the question of hunger, it  boils down to whether the sixth richest nation in the world should tolerate the idea that people can go hungry.

One crumb of comfort for the Chancellor, if he reads the Gospels, is that Jesus, though hungry, refused to turn stones into bread because “man does not live by bread alone.”  There are no quick fixes on the road to salvation or economic recovery.

 Cathy Pharoah,  Professor of Charity Funding at Cass Business School, argued in an article last week that giving food to the poor is one of the most natural and traditional acts of charity.  In South Africa and Mexico, it still  happens every day as a matter of course. Food banks, she argues, are a more efficient way to organise  feeding those on benefits  and suggests that banks for other things – like personal computers – should be provided too.

If this is the case,the local recycling dump assumes a whole new role. I like the idea of  recycling computers but still am deeply uncomfortable about the idea that food banks are becoming part of our staple diet .

In the Gospels Jesus feeds his followers on the mountainside or dines with  the bankers of his day  persuading them to make four fold reparation.  He said  farewell to his followers over an iconic last supper. Jesus knew that life changing events happen over a meal.

The highlight of the week ahead for me will be lunch at Il Piccolo with a good friend.  The proprietress will greet me, for reasons best known to herself,  as ‘Georgous George’. 

Such fun is diminished if others unnecessarily go hungry. To quote the Latin American grace, “Give bread to those who are hungry, and hunger for justice to those who are fed”.