Monday, 24 September 2012

Clegg's using pensions for property scheme, don't hold your breath

The Liberal Democrat leader boasted at the party's annual conference that, his government are announcing a plan to help first time buyers get on the housing ladder. Attracting great headlines and no doubt steadying the queasy Lib Dem membership, this plan sounds great and going by the old maxim if it sounds to be good to be true it probably is. Basically the plan is for first time buyers to use their parents pensions to afford a deposit and voilĂ  break the high house prices versus low wages deadlock, win win, well at least superficially.

Clegg in his leafy suburb, practising his sorry face.
My initial scepticism of the plan was whether it would just be meant for richer families. I asked on twitter if the plans would include state pensions and the replies were none, not a single one. A little odd I thought, so I checked it out and indeed it does not include state pensions, only private pensions. Perhaps the millionaire Clegg in his lovely home in a fashionable neighbourhood of London is unaware, but here among us common folk, private pensions are rarer than Liberal Democrat supporters. The children of fishermen, factory workers, labourers, builders or to put it short many ordinary Cornish people do not have great pension pots to dip into. My parents for one unfortunately were relying upon paying national insurance to get a pension, believing in good faith that would be enough. What hope does this scheme offer the most needy, again and again this government appeals to the most affluent.

This was my initial critique, digging further past the flattering headlines I came across this great piece on the Guardian website Will Nick Clegg's 'pension for property' scheme work. It turns out that the pension providers are very sceptical about this scheme, presumably without their backing this scheme would fail. But that's not the worst thing about it......

Realistically though the Lib Dems are working on an assumption that only 12,500 people would take up the offer. Privately they say the industry suggests a range of 10,000 to 20,000. It's a tiny figure, and doesn't warrant the rather dramatic introduction from Nick Clegg on the Marr show, but better than nothing, they say. link

To put that figure in context there are a lot more people than that on the housing waiting list in Cornwall never mind throughout the UK! This is the problem with the Liberal Democrats and their Conservative chums they recognise problems but don't get even close to dealing with them. Which says a lot for the state of Nick's party, one of the great centre pieces of their conference, the great policy announcement is a half baked idea that will benefit a tiny percentage of people.