RPI to CPI Early Day Motion 1032

Interested_Taxpayer

bendix wrote: »

So typical of the 'WIFM' culture of both this thread, this forum and - frankly - modern British society.

Fine. I'm certain your views will be appreciated by the expats in the farang bars of downtown Bangkok. Bye bye. :beer:

bendix

MEY wrote: »

"Bendix" Please show me where you have posted even one reasoned, dissenting view on the change from RPI to CPI, the purpose of this thread? No. All we have heard from you is increasingly puerile waffle exposing self-righteous predjudice against people who have worked in the public sector. Personally I'd be quite happy to see you and your ilk disappear to Thailand as soon as possible - but I doubt that would stop your ravings on issues where you plainly have nothing intelligent to say.
I shall endeavour to ignore you from now on but your crass outpourings, completely irrelevant to the issue - not dissenting views as you purport - do have an high irritation value I acknowledge as well as no shred of logical, reasoned debate. Still, your comments do tell us far more about you than anything you try to lay out our door. Now instead of berating us get on and enjoy working towards that golden retirement you plan for yourself.

Nor "Slaphead" have you ever demonstrated as far as I recall why opposing the change from RPI to CPI is "unjustified". I warrant I understand that you disagree but why is it unjustified? CPI is not a more accurate measure of personal inflation for pensioners than RPI. Even the IFS agree with that. So where is the argument? It is a pure cost-cutting arrangement but one without any foundation of reasoning, dressed up as a rational change toward more accuracy. If this was done because of the dire state of public finances as a short term measure that may have some support from those affected, but it isn't. It is a means of trying to permanently wriggle out of a contract to raise pensions in line with inflation. Inflation as it affects ordinary people, not the notional sort that the EU uses to compare nation to nation.
I'm sure no one would get "hot under the collar" if posters kept within terms of the issue and not use it as a launch pad for ill thought out twaddle, Bendix.

OK . . Let's make this simple.

There are two very good reasons why I support the move from RPI to CPI.

1) Because the country is broke, and it's beholden upon EVERYONE to take a haircut in one way or another. I don't know if you've noticed but tax rates have gone up, VAT has gone up, benefits are being cut. A million private sector people have lost their jobs and now those being supported by the public sector are being asked to pay their part too.

Is it fair? Is it reasonable? Frankly, yes. My tax bill has soared, but that's fine. I understand why. That is my contribution.

Now it's your turn.

2) Because if CPI is used by governments and businesses as a guide to increasing benefits and salaries then - ipso facto - costs and prices will rise by only CPI going forward, meaning the whole debate is meaningless. It's Economics 101.

MEY_3

Oh Bendix. Well at long last you are now on topic. I see that you feel the need to make this simple so I'll try to follow suit. You should really broaden your vision a bit. Maybe I can help you.

1) Pensioners may pay tax so they are hit there too. Benefits are being cut - because they are moving to CPI. VAT has gone up. Pensioners pay that too. Tax rates have changed, not necessarily upwards. But as has been stated previously, the move to CPI is not temporary, whilst the country is in a bind. It is permanent. Also it affects current pensioners. People who made their deal before this bank-induced mess came along. Also employment is generally harder to get for pensioners to make up this difference. If they do, they are going to be taking jobs that can be done by others - some of whom have never worked. Also they have less time to respond and make up the shortfall. They probably have greater savings than younger folk building up a future and have already taken a huge hit on savings through poor interest rates. Savings that in many cases they use to supplement their income. And you have some one-eyed idea that all this means is that current public service workers are affected. Well, Civil Service pensioners are affected not just prospective pensioners, as is any private pension scheme that is linked to the public sector, that includes former public sector workers and any scheme that is tied to the relevant Acts of Parliament in their trust deeds. Other's that have or have been re-written to link to RPI are unaffected.
Oh, and as we well know, everyone doesn't "take a haircut" as I have just demonstrated and as Mr. King's (Bank of England) pension arrangements have demonstrated amply this week. Still awaiting to discover if MPs pensions are linked to RPI. They are being very coy about that one, despite repeated enquiries. May have to see what I can find out under the Freedom of Information Act. I'm surprised because you are old enough to know that it is never everyone that takes the hit when things like this happen.
As for point 2 you clearly didn't read my earlier reply. The fact that CPI is used by governments (businesses only follow the government lead) is irrelevant per se. It was introduced for cross-comparison with other EU governments. That is all. It was not designed as a measure of personal inflation. I think you should do some research and see exactly what is included in CPI vis a vis RPI before you comment. How, for instance, can housing costs not be an inflationary measure? Why are overseas student fees relevant to natives of these isles?
All that is being requested is that the said index reflects true personal inflation as far as possible. CPI doesn't, RPI doesn't but RPI is significantly more accurate by dint of what it includes than CPI which doesn't and frankly was never designed nor intended to. Finally, as mentioned before, but ignored by you; if the inaccurate CPI is used by all and it doesn't represent true personal inflation, we all get poorer, but in various ways and degrees, unless one's wealth is in some assets or abroad. Logically, if your statement is true about the effects of everything being measured by CPI then it must also be true that if no inflation measure was used at all - none existed - the effects would be the same. Of course, that would accellerate a decline in any "wealth" accrued even faster than is the case now, and it would result in even less spending power. The other weakness in your argument is that you talk of CPI being used across the board by governments and businesses. But the pensions affected by this used the government indicator, RPI, even where the trust deeds mentioned the Acts. Now we have some using RPI and some CPI purely down to the wording. So logically, if RPI had been maintained as the index these schemes would all be on a par with each other, at least. Now they are not. No incentive for any business to negotiate to restore RPI - no reason for any trustees to want CPI. Has this begun to explain the ramifications of this and why it is a point of contention?
As someone not directly affected I can understand why you want the cheapest deal. As someone affected directly by this can you see why I and others resist it? You don't have to agree with us, but at least have the decency to argue it without talk of pens and cardigans just because you resent the public sector, and the state machine no doubt.

bendix

MEY wrote: »

Oh Bendix. Well at long last you are now on topic. I see that you feel the need to make this simple so I'll try to follow suit. You should really broaden your vision a bit. Maybe I can help you.

1) Pensioners may pay tax so they are hit there too. Benefits are being cut - because they are moving to CPI. VAT has gone up. Pensioners pay that too. Tax rates have changed, not necessarily upwards. But as has been stated previously, the move to CPI is not temporary, whilst the country is in a bind. It is permanent. Also it affects current pensioners. People who made their deal before this bank-induced mess came along. Also employment is generally harder to get for pensioners to make up this difference. If they do, they are going to be taking jobs that can be done by others - some of whom have never worked. Also they have less time to respond and make up the shortfall. They probably have greater savings than younger folk building up a future and have already taken a huge hit on savings through poor interest rates. Savings that in many cases they use to supplement their income. And you have some one-eyed idea that all this means is that current public service workers are affected. Well, Civil Service pensioners are affected not just prospective pensioners, as is any private pension scheme that is linked to the public sector, that includes former public sector workers and any scheme that is tied to the relevant Acts of Parliament in their trust deeds. Other's that have or have been re-written to link to RPI are unaffected.
Oh, and as we well know, everyone doesn't "take a haircut" as I have just demonstrated and as Mr. King's (Bank of England) pension arrangements have demonstrated amply this week. Still awaiting to discover if MPs pensions are linked to RPI. They are being very coy about that one, despite repeated enquiries. May have to see what I can find out under the Freedom of Information Act. I'm surprised because you are old enough to know that it is never everyone that takes the hit when things like this happen.
As for point 2 you clearly didn't read my earlier reply. The fact that CPI is used by governments (businesses only follow the government lead) is irrelevant per se. It was introduced for cross-comparison with other EU governments. That is all. It was not designed as a measure of personal inflation. I think you should do some research and see exactly what is included in CPI vis a vis RPI before you comment. How, for instance, can housing costs not be an inflationary measure? Why are overseas student fees relevant to natives of these isles?
All that is being requested is that the said index reflects true personal inflation as far as possible. CPI doesn't, RPI doesn't but RPI is significantly more accurate by dint of what it includes than CPI which doesn't and frankly was never designed nor intended to. Finally, as mentioned before, but ignored by you; if the inaccurate CPI is used by all and it doesn't represent true personal inflation, we all get poorer, but in various ways and degrees, unless one's wealth is in some assets or abroad. Logically, if your statement is true about the effects of everything being measured by CPI then it must also be true that if no inflation measure was used at all - none existed - the effects would be the same. Of course, that would accellerate a decline in any "wealth" accrued even faster than is the case now, and it would result in even less spending power. The other weakness in your argument is that you talk of CPI being used across the board by governments and businesses. But the pensions affected by this used the government indicator, RPI, even where the trust deeds mentioned the Acts. Now we have some using RPI and some CPI purely down to the wording. So logically, if RPI had been maintained as the index these schemes would all be on a par with each other, at least. Now they are not. No incentive for any business to negotiate to restore RPI - no reason for any trustees to want CPI. Has this begun to explain the ramifications of this and why it is a point of contention?
As someone not directly affected I can understand why you want the cheapest deal. As someone affected directly by this can you see why I and others resist it? You don't have to agree with us, but at least have the decency to argue it without talk of pens and cardigans just because you resent the public sector, and the state machine no doubt.

Here's a tip. Could you make your posts a bit shorter, so we can read them to the end? Thanks.

At the end of the day benefits are NOT being cut. Pensions are NOT being cut. They are being increased but at a lower rate. That is an increase, not a cut. Admittedly a lower increase than might have been, but it's still an increase.

Meanwhile, tax rates have risen for everyone. That means OUR incomes are being cut. Not increased at a lower rate, but actually CUT.

Private sector salaries have been slashed in recent years. My own firm has a wage freeze for two years, before relaxing it last year. Public sector salaries are being frozen.

Those are all real cuts.

I repeat, everyone has to bear the brunt of rebalancing the budget, something - incidentally - which is nothing to do with bank-induced messes and everything to do with decades of profligate government spending of money we didn't have.

Everyone has to pay. You should think yourselves lucky that pensions are being increased at a time when everyone else is genuinely feeling the pinch.

BoxerfanUK

bendix wrote: »

At the end of the day benefits are NOT being cut. Pensions are NOT being cut. They are being increased but at a lower rate. That is an increase, not a cut. Admittedly a lower increase than might have been, but it's still an increase.

So if inflation is at 5% and your pension increase is 3% that is in effect a cut of 2% to your living standards is it not DOH!!!! If this continues every year, and you live long enough, your pension would end up worthless. So its a CUT.

Whilst taxpayers may be more affected by cuts the fact is that they still have an income from employment and have options to take on more or better paid work to keep their heads above water. A frail old pensioner does not have that option. :mad:

Old_Slaphead

MEY wrote: »

Nor "Slaphead" have you ever demonstrated as far as I recall why opposing the change from RPI to CPI is "unjustified". I warrant I understand that you disagree but why is it unjustified?

Then let me repeat my reasoning again.....

(a) It's unaffordable to virtually all schemes that are not underwritten by the taxpayer. With a regressive tax system that means ultimately the poorest will end up paying.
(b) It's not your legal entitlement.
(c) If you moved to a scheme indexing of say RPI+10% and that were also applied to all wages, benefits, pensions etc -would you really be any better off in the long run? Ergo, if a low inflation factor is applied to all wage related costs then that has to benefit everyone in the long run ESPECIALLY the low paid/pensioned.
(d) The RPI/CPI difference effect on the average & lower DB pension scheme member will be minimal (ie it will, over 20 years, be less than the cost of withdrawal of winter fuel allowance).
(e) Over 80% of MPs don't agree with you - and that's like turkeys voting for Christmas.
(f) And, yes this one is a bit selfish, the last Govt has seen those making private pension provision as being a milsch cow for it's outrageous largess in underpinning public pensions. Even Blair said it was one of his biggest regrets that he didn't tackle public sector reform. This goes a tiny way in redressing some of the balance.

Your reason why it's justified ??? Is it simply because RPI's been paid in the past therefore you believe it to be your right ? Anything else would not be fair.

bendix

BoxerfanUK wrote: »

So if inflation is at 5% and your pension increase is 3% that is in effect a cut of 2% to your living standards is it not DOH!!!! If this continues every year, and you live long enough, your pension would end up worthless. So its a CUT.

Whilst taxpayers may be more affected by cuts the fact is that they still have an income from employment and have options to take on more or better paid work to keep their heads above water. A frail old pensioner does not have that option. :mad:

I repeat - everyone has to take a haircut at this moment. Why should pensioners be any different?

Hundreds of thousands have lost their jobs already. Hundreds of thousands more will lose their jobs in an attempt to reduce the budget deficit caused solely by the Labour Government buying popularity.

Hundreds of thousands of people in employment have taken cuts in salary to help their employers stay afloat. Millions more have had wages frozen.

Millions of people have lost real money through paying more taxes.

Meanwhile, you are complaining about the contribution you are being asked to make which - so far as i can see - is to have your incomes increased, but not as much as you had it increased previously.

Nice one. I hope you're proud.

StevieJ

bendix wrote: »

Define 'traditional pension'. I have a personal pension plan which I have worked hard over the last couple of years - making considerable personal and lifestyle sacrifices - to acquire.

Because, you see, I prefer to take care of myself and my future, unlike you lot who think only of how others must take care of you.

Wrong, they were looking after themselves by choosing an employer who provided a pension as part of the remuneration package.

bendix

StevieJ wrote: »

Wrong, they were looking after themselves by choosing an employer who provided a pension as part of the remuneration package.

Fine, but as adults responsible ultimately for their own destiny they must accept that realities change. When you rely on a government to provide for your future, you have to accept that that government can change the goalposts at any moment in time.

The quid pro quo for relying on the state is that you have to accept it can change things as and when it likes.

THAT, surely, is enough incentive to make private provision too and not be totally reliant on the state which can change policies for political as well as economic reasons, at whim.

I control my destiny, or I let government and civil servants control my destiny . . mmmmmm, touch choice.

StevieJ

bendix wrote: »

I control my destiny, or I let government and civil servants control my destiny . . mmmmmm, touch choice.

I am not sure about that, surely you are at the whim of the markets, oh and tax relief, that govt handout