OpinionJul 20 2016

Don’t blame it all on Brexit

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Aren’t you all becoming just a little bit tired of every piece of negative economic news being blamed on Brexit while every bit of positive news is apparently down to some other factor?

This paradigm is being peddled in particular by the BBC, which seems almost determined to talk us into a recession so it can say: “We told you so.”

The BBC business home page on the internet is peppered with stories on Brexit concerns and Brexit worries – including a desperate story asking: “Who will pick our strawberries?”

Apparently European pickers are “astonishingly quick at it”. This comment perhaps says as much the writer’s own background than about the abilities of the workers.

A recent radio news piece regarding a slowdown in the high street focused on Brexit with never a mention of the atrocious weather in June.

When Halifax released its latest house price data showing a 1.4 per cent quarterly rise it said it was too early to determine any impact from Brexit.

But the BBC dug up an economist to predict: “Housing market activity and prices now look to be at very serious risk of an extended, marked downturn following the UK’s vote to leave the EU.”

Even an edition of the Food Programme initially presented unremitting gloom on the disaster facing our food industry before eventually devoting a section to a guest who saw a more optimistic future.

Even an edition of the Food Programme initially presented unremitting gloom on the disaster facing our food industry

As I write this the FTSE 100 is flying high, we have an energetic new prime minister and we have a number of countries already talking about trade deals – which could be built on a one-to-one basis rather than having to satisfy every whim of 29 different countries.

I confess, even I got caught up in the gloom and introspection in the aftermath of the vote – but who would not, given the endless flow of negative stories from our national broadcaster?

Yes, sterling has fallen, but does this not help exporters?

And if worldwide holidays are more expensive will this not encourage more people to take a staycation and spend money here – and, correspondingly, does this not make the UK a more attractive destination for those in the rest of the world (our weather excepted of course)?

Fortunately in the financial industry there have been some more balanced voices, such as Dr Mark Mobius. The executive chairman of Templeton Emerging Markets Group has pointed out the potential silver lining for some investors.

But even here they risk being drowned out by those who seem determined to talk us into recession.

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Back to the drawing board for gender-neutral pricing?

“Insurers eye an end to EU’s ban on cheaper deals for women drivers,” said the weekend newspaper headline. Oh here they go again I thought.

Bringing down premiums for women is code for big increases for men.

And once gender-neutral pricing was abolished where would the changes stop?

Would we be back to gender-based annuity and life assurance pricing?

Well, not quite. The story stemmed from comments by specialist insurance lawyer Geoffrey Maddock, a partner at Herbert Smith Freehills.

“I would be surprised if there wasn’t a consensus forming to move away from this,” he told a reporter.

However, the same story told us that the AA raised doubts about the possibilities of changes, which should be a relief to male drivers.

And, let’s face it, there are more sophisticated ways to set premiums than the blunt tool of gender.

Significantly, there has been no word from the ABI, so let’s hope these remain just the speculations of one individual.

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Downsizing conundrums

Steve Webb, pension minister turned Royal London director of policy, has a stark warning for the estimated three million who believe their home will be their pension: Beware, your children may not move out.

The Royal London policy paper, The Downsizing Delusion, makes a stab at considering how much income can really be generated by downsizing. The answer is, as Eric Morecambe might have said, “Not a lot.”

The mutual insurance society paper estimates that someone downsizing from a detached to a semi-detached, might end up with £13,700 a year income including the state pension. That is about half the national average wage.

But the greater fear is that downsizing would not be viable because the market may be going through a poor period, the owner may still have a mortgage or – horror of horrors – the offspring may still be lurking in the nest.

It is an interesting argument that highlights the dangers of putting all the eggs in one basket in a way that should connect with the man and woman on the street.

Tony Hazell writes for the Daily Mail’s Money Mail section