MSE News: Pension age rise bought forward

2sides2everystory

gadgetmind wrote: »

As it happens, my wife has earned very few years by working, but a whole load by raising a kid.

It is passed 12 noon on the day after I last posted and I am still reading via my long distance glasses that dunstonh indicated I might need

Bearing in mind you were the one, gadgetmind, who thought a pension of £36,000 pa was not lavish, just help reel me back in and indulge us a little with some further definitions of some relativisms ...

(a) what did you actually mean by "not lavish" - in the context of UK pension expectations generally and the fact that those are bounded by lack of defined benefit schemes to look forward to and that average UK salaries are around £25,000, I took your meaning to be "not uncommonly high".

(b) what do you mean by a "whole load by raising a kid"? Do you for example mean that she gave you the Child Benefit and you invested every penny from day one in your pension?

atush

going abroad to join a partner, etc.

Yeah, right. WE should pay for someone on a Jolly? No. Way.

gadgetmind

Gracchus_Babeuf wrote: »

If there was, maybe we could opt to receive higher state pension by paying in more in NI, but the government doesn't allow that.

Look up S2P and "class 3" NICs.

NI is just a tax like any other, but given another name.

To my considerable distress and consternation, I find myself agreeing with this one isolated statement, which is very different to me saying I agree with you.

Gracchus_Babeuf

gadgetmind wrote: »

For most of the examples you have given, other than going abroad, people earn years towards state pension under the existing system.

So what? It's up to people to decide what they want to do with their lives. Why should I have to report to the state on what I'm doing just to earn notional NI contributions.

gadgetmind wrote: »

Sorry, there's no such thing as a free lunch, never has been, never will be. And we're "subjects" rather than "citizens".

I never said there was a free lunch - that's why we have taxation. And yes, we are 'subjects' - this is exactly the problem! We don't have citizen's rights. And this is what needs to change. I often wonder exactly how much power the Queen has; I feel she has a lot more influence with the government than is generally accepted. Why does the PM have to report to the Queen every week if she does not get involved in government?

gadgetmind

[QUOTE=2sides2everystory;46866511
(a) what did you actually mean by "not lavish"
[/quote]

"Lavish" isn't a word I tend to use much as it carries a lot of negative connotations. £36k is certainly towards the upper end of private pensions (though perhaps not for public sector ones) but I don't see it as being into "fat cat" territory such that everyone should be grabbing their pitchforks.

(b) what do you mean by a "whole load by raising a kid"?

16 qualifying years towards the state pension.

Do you for example mean that she gave you the Child Benefit and you invested every penny from day one in your pension?

No, I was referring to just state pension years, but as it happens, all of our child benefit was invested for our daughter.

gadgetmind

Gracchus_Babeuf wrote: »

Why should I have to report to the state on what I'm doing just to earn notional NI contributions.

You don't, they keep track for you via child benefit and unemployment benefit records. Happy now?

this is exactly the problem! We don't have citizen's rights.

With rights come responsibilities, such as the responsibility to make sure you can support yourself in old age.

Gracchus_Babeuf

gadgetmind wrote: »

With rights come responsibilities, such as the responsibility to make sure you can support yourself in old age.

Fundamental disagreement between us. You believe that it is individuals who should be responsible for doing this, while I believe it is the responsibility of the state. Your approach is designed to protect the wealthiest, who do not need to plan a damn thing for themselves, while putting a massive burden on low and middle income people; whereas my approach favours a more equitable system whereby provision is made by the state to individuals according to need - in short, a 'social contract'. The concept of a social contract exists in most Western countries, the UK and USA being exceptions.

gadgetmind

Gracchus_Babeuf wrote: »

Fundamental disagreement between us.

I find that reassuring.

You believe that it is individuals who should be responsible for doing this, while I believe it is the responsibility of the state.

The state needs to provide a fall-back subsistence level payment. If it's any more than this, then people won't save for themselves. We simply cannot afford for everyone to sit back and hope that the state will find a magic money tree, because it won't.

Your approach is designed to protect the wealthiest, who do not need to plan a damn thing for themselves, while putting a massive burden on low and middle income people

No it isn't. If means testing is removed from pensions, then everyone will be able to benefit from their pensions savings, which looks like being the most likely outcome from the recent green paper.

Have you read it? Do you know what's being proposed and why?

Aegis

Gracchus_Babeuf wrote: »

There is no direct link between what you pay in NI contributions and what you receive from the state. If there was, maybe we could opt to receive higher state pension by paying in more in NI, but the government doesn't allow that. NI is just a tax like any other, but given another name. So let's pretend that NI is anything other than a tax.

I note that yet again you glossed over the bits where your examples of people losing out on pension through no fault of their own were all shot to pieces...

Any comment on why the 30 year minimum should be reduced to 20 after seeing some additional facts?

Gracchus_Babeuf

gadgetmind wrote: »

The state needs to provide a fall-back subsistence level payment. If it's any more than this, then people won't save for themselves. We simply cannot afford for everyone to sit back and hope that the state will find a magic money tree, because it won't.

I am well aware that the government is trying to encourage (or manipulate) people into saving more, but this is not a panacea. It's a hidden tax, and many people cannot afford to pay this tax, because it falls disproportionally on the poorest in society. The poorest won't bother saving anything anyway, and rely on the minimum pension guarantee. This approach won't work.