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Friday, July 20, 2012

The next door neighbour question


In 1977 member of the British Parliament posed a question:
For how long will English constituencies and English Honourable members tolerate ... at least 119 Honourable Members from Scotland, Wales and Northern Ireland exercising an important, and probably often decisive, effect on English politics while they themselves have no say in the same matters in Scotland, Wales and Northern Ireland?

Thirty-five years later a committee of the House of Commons was established to try and answer it and to give its report  “sometime in 2013”.

The MP who asked the question represented the constituency of West Lothian. His question about something that is obviously absurd but that nobody wants to confront is called, not surprisingly, the West Lothian Question.

I think there is another such question that applies to the endless debate about who funds care in later life and why people should save more money to fund their retirement. This question is called: “The next door neighbour question.”

Let me explain. Mr. & Mrs. Brown live at 10 Happy Gardens. They are careful with their money, never go into debt, save for their old age and contribute all of their life to get a modest pension. Next door (that is where the name comes from) lives Mr. & Mrs. Black who spend all the earn, have zilch savings and never bothered to pay in for a pension.

Both the Blacks and the Brown need care services. The Browns have to pay for all of their services and then have to subsidize the services given to the Blacks. The Government will take the Brown’s savings and their house – the Blacks who have nothing to take lose nothing.

I have sat through too many conferences and events where policy makers have attempted to explain why UK should all be like Mr. & Mrs. Brown. When the question is raised – so what is the penalty for being a Mr. & Mrs. Black – they have no answer. Why is that? Simple. There is only one answer and that is the state provision given to Mr. & Mrs. Black would need to be significantly worse than that provided to the Browns. That is not an answer that can be given or even discussed.

So we continue having more conferences and more reports that do everything but answer the next-door neighbour question. Until they do it is impossible to construct credible policy solutions. Let’s hope we get an answer faster than it is taking to solve the West Lothian question. Dick Stroud

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