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  • FIRST POST
    • ipri
    • By ipri 15th Oct 16, 2:12 PM
    • 609Posts
    • 42Thanks
    ipri
    Will new S Pension cause resentment?
    • #1
    • 15th Oct 16, 2:12 PM
    Will new S Pension cause resentment? 15th Oct 16 at 2:12 PM
    Will people who get the new SP not be a source of resentment from those who , if I'm correct, will receive less?
Page 2
    • fredandwilma
    • By fredandwilma 16th Oct 16, 2:08 PM
    • 590 Posts
    • 947 Thanks
    fredandwilma
    Thanks for all the replies.


    I didn't realise there was still a "protected payment" although there's still time for things to change. I will still have the maximum amount of contributions for the "qualifying" years. That's good to know, although i know i can claim pension credit. I still doubt i will ever see my pension. Money can't buy you health and however much planning you do, you can't plan for the unexpected. Even if the government introduces means testing, it still won't affect me.
    yabba dabba don't
    • fredandwilma
    • By fredandwilma 16th Oct 16, 2:16 PM
    • 590 Posts
    • 947 Thanks
    fredandwilma
    And I guess the "no longer retire for another 6 years" should actually read another 1 year. Unless of course you like so many others were illiterate until they hit their late fifties.
    Originally posted by badmemory
    No, i meant what i wrote.

    Maybe i should write "effect" rather than "affect" as i'm illiterate?

    I can't believe someone thanked your post.
    yabba dabba don't
    • hyubh
    • By hyubh 16th Oct 16, 3:34 PM
    • 1,553 Posts
    • 1,043 Thanks
    hyubh
    No, i meant what i wrote.
    Originally posted by fredandwilma
    Leaving aside badmemory's rather impudent comment, does this mean your original complaint was about stage pension age equalisation...? It's never been possible for someone to take their state pension early due to ill health (or indeed some other reason), partly due to its peculiar status ('contributory benefit').
    • xylophone
    • By xylophone 16th Oct 16, 4:17 PM
    • 19,157 Posts
    • 10,874 Thanks
    xylophone
    Assuming that you were born in 1956, then you would have known from your late thirties that your SPA would not be 60.


    You would have expected age 65 which has changed to age 66.

    Presumably you made such private provision as was open to you in your circumstances?

    As you are too ill to work, presumably you have explored the possibility of ill health benefits - ESA/PIP?

    With regard to pension credit, the age of entitlement to claim is increasing with female SPA.

    http://www.ageuk.org.uk/Documents/EN-GB/Factsheets/FS48_Pension_Credit_fcs.pdf?dtrk=true
    • ipri
    • By ipri 16th Oct 16, 4:39 PM
    • 609 Posts
    • 42 Thanks
    ipri
    He has a superannuation pension NHS...like me.
    • hyubh
    • By hyubh 16th Oct 16, 6:37 PM
    • 1,553 Posts
    • 1,043 Thanks
    hyubh
    He has a superannuation pension NHS...like me.
    Originally posted by ipri
    Your wires are getting cross then - assuming he was in the NHS scheme for the majority of his time working here, then his state pension will very likely be the protected amount under the old rules, since under the new rules it would be a lot less given all the contracting-out.

    Or, in other words - you're confusing the 2016 changes with those made nearly a decade before which reduced the number of qualifying years for a full basic state pension to 30. Even then he wouldn't be getting the new single tier however, just what he would got before...
    • kidmugsy
    • By kidmugsy 16th Oct 16, 9:31 PM
    • 8,499 Posts
    • 5,475 Thanks
    kidmugsy
    Will people who get the new SP not be a source of resentment from those who , if I'm correct, will receive less?
    Originally posted by ipri
    Resentment festers whatever the facts. The Bible is very sound when it cautions against coveting, but few pay any heed.
  • jamesd
    I belong to the group of people who were hit the hardest by the last pension reforms.
    Originally posted by fredandwilma
    That would make you a man.

    The reason men are most affected by the recent change is that the year added to state pension ages affects men more because men's life expectancies are usually lower than women's. As a result the average effect is men receiving a larger reduction in their lifetime sate pension payments than women.

    I can no longer retire for another 6 years, (collect my state pension)
    Originally posted by fredandwilma
    But that would imply that you are a woman, not a man, so were not among the group most badly affected by the recent change. Except that a life limiting condition which means you expect not to reach state pension age makes that moot for you whether you're a man, woman or neither.

    There was an earlier change due to gender discrimination cases compelling a change in law and just the plain injustice fixing of unequal state pension ages between men and women. That one dates from 1995 and provided for the state pension age for women to be gradually increased between April 2010 and April 2020. We're in that equalisation timeframe now, with the inequality between men and women in state pension age gradually being removed. There was a very extensive information campaign in the mass media and even personal statements with the new ages sent to everyone affected, using the latest address information held by HMRC. Changes were made faster along with a further delay with the 2010 Act, though there was a substantial and costly slowing down of the rate for many women compared to the original proposal.

    I would love to be in receipt of my state pension which would have been around the £276 a week stated.
    Originally posted by fredandwilma
    You're not affected at all by the change that the original post here was about. That's the change from a state pension linked to earnings to a flat rate one at about £155 a week maximum, however many years a person works. Those entitled to more under the older rules like you continue to get the older rules level.

    You would get the full flat rate with triple lock and the extra above the flat rate cap level will be inflation-linked only. This is a higher amount covered by the triple lock than before, it used to be only the lower basic state pension portion, so you actually could expect a higher overall state pension than previously if you were going to live long enough for it to matter.

    If you were working during 2015-16 your state pension level won't be available until around November or December this year because that's when the 2015-16 earnings are included. If you weren't working that year the ones now should be OK.

    Sorry to read about your life limiting illness and I hope that yours progresses as well as possible so that you can enjoy your remaining time as much as possible.
    Last edited by jamesd; 16-10-2016 at 11:13 PM.
    • fredandwilma
    • By fredandwilma 17th Oct 16, 8:21 AM
    • 590 Posts
    • 947 Thanks
    fredandwilma
    Thanks for your reply, jamesd.


    I thought the "older" rules no longer applied, but i suspect it's only a matter of time before they are abolished in more pension reforms and likely before i reach pension age, in any case?


    It's frustrating to be in this position, as I've worked hard all my life and even expected to continue working after retirement, but you never know what curve ball is going to be thrown at you. I try to get through each day the best i can and live in the moment, accepting that's the best i can hope to achieve. It's all about refocusing and acceptance. However, my life would have been made somewhat easier without the pension reforms and i know there are others in a similar position.
    yabba dabba don't
  • jamesd
    Once the foundation amounts from April 2016 are calculated there won't be any old rules calculations, except for things like correcting mistakes. That doesn't matter because the old rules calculation is one of the two used to get to the foundation amount, old rules and new rules, you get the higher of the two calculations. Then from 6 April 2016 it's just the new rules used to calculate increases beyond the foundation amount.

    The inflation only increases to the portion above the flat rate cap is what will gradually reduce the value of amounts above the flat rate. But this isn't any extra loss because that's also the inflation linking used under the old rules.

    Sadly life does have some curve balls. Best we can do is wish you well and hope that we get less unfortunate curve balls heading in our own directions.
    • molerat
    • By molerat 17th Oct 16, 5:03 PM
    • 15,017 Posts
    • 9,368 Thanks
    molerat
    There will be loads of recalculating of foundation amounts right up until April 2023, the cut off date for purchasing 2006 - 2016 missing years.
    www.helpforheroes.org.uk/donations.html
    • Straight Shooter
    • By Straight Shooter 17th Oct 16, 7:01 PM
    • 8 Posts
    • 1 Thanks
    Straight Shooter
    Generalising, all pensions (state or workplace), welfare benefits, salaries, asset price rises etc etc, are potentially a source of resentment from those who will receive less. That happens if people are envious and resent what they don't have for themselves, and it is a personality trait which is held by many.

    My dad has the state pension for those reaching the requisite age pre April 2016. I will get the one for those reaching the age after April 2016 and it may change again before I get there (currently slated for age 67, while Dad was at 65 and Mum at 60).

    If I was allowed to retire under the old rules I would have had a bigger pension than under the new rules because under the new rules I won't be able to get more than £155ish (in current year terms) even if I have 50+ years of non-contracted-out contributions, while under the old rules I would have been able to get to £200 plus.

    Will my Dad be resentful of me for being landed with a deal that only allows me to get a smaller amount of money from the state per week than he was allowed to get, and from a later age? Seems pretty unlikely that he would resent me getting that deal, because I'm getting less. Maybe he will instead be resentful that I might get to live longer than him because of improving healthcare and longevity through the generations. Should I take action to worsen my health to make sure I don't?

    Probably we are better as a society if we don't resent what others have. Instead focus on making the best of what we have and helping others rather than being envious of others.
    Originally posted by bowlhead99
    Ok I'm confused now, I had researched my position and read that those currently in their 50's & 60's who have paid higher levels of NI and therefore qualified for additional state pensinon would be able to keep their entitlement under the rules of 'protected payments'
    • greenglide
    • By greenglide 17th Oct 16, 7:19 PM
    • 2,358 Posts
    • 1,456 Thanks
    greenglide
    If you were working during 2015-16 your state pension level won't be available until around November or December this year because that's when the 2015-16 earnings are included. If you weren't working that year the ones now should be OK.
    I reached SPa in May this year and claimed my nSP this month (deferred for 20 weeks to ensure I don't pay higher rate tax this year) and my award was calculated in full. The earning data for most people for 2015-2016 seems to be available - in line with what people see on the online pension forecast facilities.

    Ok I'm confused now, I had researched my position and read that those currently in their 50's & 60's who have paid higher levels of NI and therefore qualified for additional state pensinon would be able to keep their entitlement under the rules of 'protected payments
    Anyone who has an SP entitlement which is above the new State Pension standard rate gets to keep the extra as the Protected Payment. This is inflation linked by the CPI (currently) while the nSP itself is indexed by the triple lock.

    There are no proposals that I have ever seen to change
    the Protected Payment.
    • Sleazy
    • By Sleazy 17th Oct 16, 7:27 PM
    • 2,692 Posts
    • 2,490 Thanks
    Sleazy
    Using myself as an example:
    Worked since 16 - mostly contracted out with two jobs, so two reasonable pensions.
    SP under the old system would have been £122 pw.
    If I contribute NI until age 66, my SP will be £155.

    Should anybody be resentful? Certainly not me - I've already worked over 40 years but paid a reduced rate of NI. Anybody else resentful - Over the next few years I'll be paying for my increased SP through my NI contributions.

    My situation is I suspect similar to many others, so cause for resentment by anybody? Don't see why.
    *** IF IN DOUBT, BLAME BREXIT ***
    • hyubh
    • By hyubh 17th Oct 16, 8:27 PM
    • 1,553 Posts
    • 1,043 Thanks
    hyubh
    My situation is I suspect similar to many others, so cause for resentment by anybody? Don't see why.
    Originally posted by Sleazy
    Obviously not yourself because you're one of the winners! In a parallel universe however your doppelgänger, who was contracted in all the time, has found his state pension accrual to have come to a premature stop. With his NI not having fallen in recompense, he is reading this thread and quietly seething at the 'moaning minnies' (as he puts them) with their fat final salary pensions...
  • jamesd
    There will be loads of recalculating of foundation amounts right up until April 2023, the cut off date for purchasing 2006 - 2016 missing years.
    Originally posted by molerat
    True, though not a lot compared to doing it every year for everyone! I just hope that it's made really clear to people whether they can affect their foundation amount at all by buying those years.
  • jamesd
    I had researched my position and read that those currently in their 50's & 60's who have paid higher levels of NI and therefore qualified for additional state pensinon would be able to keep their entitlement under the rules of 'protected payments'
    Originally posted by Straight Shooter
    That's right.

    But it's also a misleading. The higher amounts will be included in the foundation amount calculation. If that's above the flat rate, you keep the part that's over and get no more increases for paying in for extra years. If it's below the flat rate it reduces the number of years of paying in that you need to get to the full flat rate.

    The result is that at younger ages you effectively lose the higher amount of money because all it does is mean that you reach the flat rate sooner and stop accruing more sooner.

    It's those who are relatively close to state pension age now and already above the flat rate level who get well protected. The higher above the flat rate level you are and the closer you are to state pension age, the better off you are from the transitional protection.

    This sort of thing is also why those who were contracted out a lot are likely to be winners. They start out with a lower state pension in their foundation amount and can just pay in for the extra years to get to the flat rate cap, when their peers who weren't contracted out just hit it and stop gaining sooner.
  • jamesd
    ...mostly contracted out with two jobs, so two reasonable pensions. ... SP under the old system would have been £122 pw. ... If I contribute NI until age 66, my SP will be £155.

    Should anybody be resentful? Certainly not me... so cause for resentment by anybody? Don't see why.
    Originally posted by Sleazy
    Certainly not you because you're one of the big winners from the change!

    You get to keep the private pensions that the reduced contributions paid for and also get to pay in for the extra years to get to the full flat rate when your peers who weren't contracted out will already have stopped getting any more increases.

    You illustrate one group that could be unhappy: those who weren't contracted out, particularly a large proportion of private sector workers.

    Those in the public sector in general end up as big winners from the change because their schemes normally were contracted out.
    • OldBeanz
    • By OldBeanz 17th Oct 16, 11:11 PM
    • 540 Posts
    • 381 Thanks
    OldBeanz
    Presumably some of those affected will be those public servants who retire this financial year on £120 pa while those retiring in 7 years time will receive £155 or be able to pay contributions to reach that amount.
    • hyubh
    • By hyubh 17th Oct 16, 11:28 PM
    • 1,553 Posts
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    hyubh
    Presumably some of those affected will be those public servants who retire this financial year on £120 pa
    Originally posted by OldBeanz
    If they have pre-97 service, they get their GMP fully indexed for life. I struggle to feel sorry for them
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