Government Spending cuts

We like you, will no doubt discover the full gory impact of today’s expenditure cuts announcement, gradually over the next few days. Such is the detail and nature of these things, that several days after the main headlines are losing their initial impact, news of further implications and ramifications will seep into the public domain.

However the real impact will come some way down the line as the various benefit cuts, tax increases and additional costs (such as the hike in rail fares) start to directly hit your wallet. The vast cocktail of measures makes it very difficult for anyone to quickly assess the precise affect on them. Nevertheless, the coming weekend’s papers and professional economists’ blogs will no doubt make a good stab at quantifying the bad news for a range of ‘case study’ families.
For some of our clients the changes could require a rethink of their f
uture financial plans and using our experience and lifetime cashflow modelling software, we will be able to demonstrate the effect of changes such as increased expenditure and deferring retirement age (increase in State pension age to 66).

We also expect many more people to ask us to help them examine carefully their pension arrangements, particularly those people whose jobs are in jeopardy or whose pension benefits are being diluted. We fully expect that many final salary pension schemes will require increased contributions for lower benefits at a later pension age.

We won’t know for some time whether the medicine the coalition has administered has saved the day or pushed us towards a double-dip recession. Economists seem fairly equally divided on this point. All we can say for now is that we are here for our clients, ready to listen and provide practical advice.

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Lord Young's address to the Conservative Party Conference

This week Lord Young addressed the Conservative Party Conference about the operation of health and safety laws. Britain has one of the lowest incidences in Europe of accidents and deaths in the workplace. He concluded that the regulations in place, in relation to the construction and heavy industries, work well. In Lord Young’s view it is the overzealous application of these regulations in relation to non hazardous activities that creates the problem.

Employers, managers and head teachers, he said, are driven by a fear of being sued and not by a desire to prevent accidents. Lord Young was especially critical of the untrained and inexperienced “health and safety” consultants, employed by small businesses that recommend disproportionate safety measures. These businesses follow the recommendations of these unqualified consultants in the belief that compliance is a requirement of the terms of their insurance. This results in ludicrous policies such as the refusal of a restaurant to provide customers with toothpicks. Whilst we welcome a review of the practices of insurance firms and health and safety consultants had it not been for the enforcement of our health and safety laws by judges in personal injury cases up and down the country perhaps we wouldn’t have one of the lowest incidences in Europe of accidents and deaths in the workplace.

Read more about Hart Brown's personal injury department here