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The Actuary The magazine of the Institute & Faculty of Actuaries

Want to work as a ‘policy wonk’?

T he Institute of Economic Affairs (IEA), an educational charity, was established nearly 50 years ago. According to its mission statement, its purpose is: ‘to improve public understanding of the fundamental institutions of a free society, with particular reference to the role of markets in solving economic and social problems.’
The IEA has been very successful. Against much opposition it has changed the climate of opinion on issues such as: the causes of inflation and unemployment, nationalisation, exchange control, incomes policy, private sector involvement in health and education the list goes on. The IEA is still operating in new fields where it believes the boundaries between the private and public sectors need redrawing: health, education, regulation, the EU, and so on. Some of the issues affect actuaries directly, such as pensions, welfare, financial regulation and, from an earlier generation, exchange control. Other issues affect the general environment in which actuaries operate. If only the IEA had not altered prevailing wisdom on the causes of inflation, perhaps the Equitable affair a product of low nominal interest rates would not have happened! But we make no apology for that!

Public policy needs you!
Jobs for actuaries in think-tanks such as the IEA are few and far between, so I shall broaden the focus of this article. Why should an actuary work in the field of public policy? Professional mission statements talk a lot about actuaries and long-term planning. No doubt the profession’s Councils would regard actuarial skills as ideal for long-term planning in public policy. However, that is certainly not my motivation for working for a think-tank.
I believe in less public sector planning, not better public sector planning. Our financial services and corporate governance do not seem to be benefiting from the huge increase in regulatory requirements I do not want the profession to get wrapped up in this area either. The profession should not get involved with public policy issues unless policy initiatives are a threat to the independence of the profession, or can be objectively improved by analysis by the profession. Nevertheless, individuals in the profession should use their analytical skills to get involved in political and policy processes. Where can they do this and why bother?
To address the second question first. Those not involved in policy discussions, policy development or the political process may be surprised how developments can be influenced by rational argument and debate. There is much less inertia in the British political system than in, for example, other EU countries. There is a vigorous political and philosophical debate in the UK parliament and its environs. Politicians and their advisers are influenced by rational argument. Sometimes you may win the argument but, nevertheless, see policy of which you disapprove being implemented. Don’t be despondent, your ideas may have influence further down the line. Get involved in debate. Use your analytical skills and experience.

Standing for Parliament, anyone?
As to where to be involved, the possibilities are endless. At one end of the scale there is part-time involvement in local political associations. Here influence over debate is minimal, but influence over the choice of political candidates is considerable. I am also aware of a number of actuaries who are thinking of standing for Parliament or who have stood for Parliament, and many who are prominent councillors. Further upstream, working in the many policy fora that political parties set up can be productive, although sometimes they are a charade. Then, of course, there is the political adviser class the Ed Balls of this world which is an increasingly powerful group and, without question, more powerful than any backbench or opposition MP. Some such people work their way up from the inside (backbencher’s researcher first), others come in from the outside world. If you are in the right place at the right time and know the right people, you could become the adviser to the secretary of state for work and pensions, if that takes your fancy. Depending on the minister, you could have considerable influence on policy and a great deal of fun.

Think ‘tanks’?
And then there are the think-tanks. Some try to influence day-to-day policy developments by feeding in ideas and promoting them among MPs, ministers, and advisers. Others such as the IEA concentrate on changing the ‘climate of opinion’ rather than the political weather of the day, working with much broader groups of people on longer-term topics. There are few full-time jobs with such think-tanks, but most are on the look out for authors, lecturers, people to bounce ideas off, and so on. If you are interested in being a ‘policy wonk’, look at their websites (for example, www.iea.org.uk, www.smf.co.uk/ or www.politeia.co.uk/), go along to their functions, meet people, and talk policy.