With our pension freedom comes the danger of mis-selling on an epic scale

My Week

The election must be coming. The Tories have gone into overdrive, pleasing their core voters by freeing up pensions and investments.

In one week, we had two key announcements.

First, we will soon be able to dip into our pension pots as we please. Second, the Treasury is going to consult on setting up a third type of tax-free Isa, aimed at peer-to-peer lending.

It feels like the chains are coming off our cash. Unfortunately, the effect is not dissimilar to that of the old lag suddenly let out of jail. He walks, blinking into the sunlight, ill prepared for the world that awaits, unsure as to what he is going to do.

I have two fears, and they go together. One is that we are simply uneducated as a society in the ways of finance. We’ve always been brought up to put our trust in others – in the bank manager, in the man from the Pru, in our pensions adviser. As a result, we’ve not had to think too much, preferring to let more knowledgeable people do our thinking for us. We’ve been able to switch off, not paying much attention to the vagaries of the markets, the harsh reality that shares can go down as well as up, that investments can crash as well as soar.

The other is that even those so-called experts have ripped us off, selling us financial products we don’t need and that don’t work.

That, though, is with the old restrictions in place. Now we’ve got greater freedom and flexibility – and just imagine what the more unscrupulous operators are thinking. I just hope we’re not creating a charter for mis-selling on an epic scale.

Leave Europe? We’re playing with fire

Over lunch at one of the big US investment banks, the discussion is about the markets. Considering we’ve got four crises at present – ebola, Ukraine, Isis and Hong Kong – it’s remarkable the markets have held up as they have. There have been dips, but nothing catastrophic. Asia and America are continuing to perform, and the numbers there are still strong.

But there is one item that is causing angst here, said a top banker: Brexit. We’re playing with fire if we leave the EU. He says we have no idea just how many foreign businesses are here precisely because we’re in the EU, using the UK as a staging post for Europe.

The impossible dream of the beautiful game

On London Live TV, I interview Gerard Lyons, Boris Johnson’s economics adviser. On camera he is optimistic about the global economy, and how London is set to reap even more benefits. Off, he is downbeat, but that is when we turn to another subject of mutual interest: Fulham FC.

In just three seasons, Fulham have gone from competing in the Europa Cup final and riding high in the Premier League, to propping up the Championship. Truly, anyone investing in football, believing success can be made permanent, needs their head examining.

In Sir Richard Broadbent we trust

So it is in the corporate sector, where the travails of Tesco still shock. Another week, and yet more suspension and resignation.

I’m told by someone very close to the retailer not to underestimate the chairman, Sir Richard Broadbent – that he really is on top of everything and is determined to right the ship. For everyone whose pension is tied up in Tesco, I sincerely hope so.

From ambition, to hubris, to nemesis

At the Evening Standard “Influentials” party, for the 1,000 people regarded as those who really make London tick, the chat is also of Tesco. Several of the guests have connections with the supermarket group going back years.

The consensus appears to be that Lord MacLaurin laid down a template of fierce ambition and that was passed to Sir Terry Leahy, who handed it to Philip Clarke. Along the way, a culture of aggression crept in and that led, finally, to hubris.

Labour is alienating the City

Among the guests at the Influentials bash is Chuka Umunna, the shadow Business Secretary. He takes me to task for something I wrote that was critical of Labour’s attitude to business.

He’s compelling and plausible. This is the thing with Mr Umunna: among business folk he comes across as one of them – he speaks their language and displays understanding; yet he is a senior member of a party that increasingly shows an anti-big business face. He will say that is not true, that Labour is pro-business and all he and his colleagues are trying to do is make the richest in society pay their fair share.

Inevitably, though, that rich element includes those at the top of business and those hoping to get there. Labour is trying to have it both ways. It must stop saying it loves business one minute, then hitting it the next. Perception is all, whatever Labour says, and it’s been a long time since I’ve seen relations between the City and the party as poor as they are now.

A sitting target for complaints about excess

If Labour stuck to blatant excess, I wouldn’t have an issue with that. One clear example that should have the party and institutional shareholders screaming from the rafters is BG Group, and the hiring of Helge Lund as its chief executive from Statoil. His total possible pay package is £29m, including a £480,000 relocation allowance.

In 1995, campaigners paraded a pig called Cedric outside the shareholders’ meeting of British Gas, which in those days included what is now BG. That was in protest at the salary of the then chief, Cedric Brown. He was being paid £475,000.

I know inflation counts for something, but it’s remarkable that 20 years later one of his successors is receiving an even bigger sum, just to move house. You would think alarm bells would ring within BG, but I would wager there is no one left in a senior position from those days.