MSE News: Budget 2012 - £3.3 billion tax blow for pensioners

oldwiring

As GO previously had said Age Related Allowances are to be with drawn, this

From April 2013,
ARAs will no longer be available, except to those born on or before 5 April 1948.
The higher ARA will only be available to those born on or before 5 April 1938.

Does not seem to make clear sense. BTW I am in the latter category!

I do not criticise those who have concerns, but think we pensioners have to take hold of the whole picture, some of which may stilll be to be revealed in the future. And of that future, we need consider by how much our true financial situation (not just how much money we get) would be if our economy failed to improve, but declined.

Might we then be moaning about fiercely more substantial real term cuts.

Laugh or abuse, as you wish:D, but being young in a period when people had to make greater, even life sacrifices than any contribution pensioners make now, perhaps my thoughts will not be yours.

ebjb

Absolutely disgraceful taking money from the poorest pensioners to give to those who have more income. I say poorest pensioners because I believe anyone with over £25,400 get to keep the increased tax allowance ? (I think) It's like Robin Hood in reverse - typical Tories - they stuffed us here in Scotland with their Poll Tax and here we are when only ONE (yes ONE) Conservative MP was voted into Parliament in the last election, getting stuffed again ! Roll on Independence - I hope SNP get control of our own tax system and they give pensioners back their increased allowance. I also note we are being told Pensioners are getting over £5 increase in pensions - that's only because of the rate inflation was in September. They changed the RPI to CPI (because CPI is a lower rate) so wait till next year, pensioners will be lucky to get half that increase while everything else goes up in price including increased cost of heating here in Scotland while England suffers a drought. All I can say is GET THEM OUT at the next general election - maybe the pensioners in the rest of the UK will vote to get them out because of this unjust tax reform.

ikr2

The State Pension is going up by 5.1% in April or just over £5 per week. Given that CPI peaked in Sept 2011 when this was set, it looks like an inflation-busting rise. I accept that energy and other bills mean that inflation for individual pensioners might be higher than this (although council tax has been frozen in many councils).

I think this rise and previous rises in the state pension and pensioners' tax allowances mean that since the Tories and Lib Dems came to power, the poorest pensioners may break even, even with the ending of the over-65 tax allowance in this budget. Not great I know but when everyone else is being asked to tighten their belt it isn't as bad as the media make out.

I would really like to see some independent analysis of the changes to pensioners' tax and benefits since May 2010. The problem with Budgets is the effect of each one is often taken in isolation and not over the course of a Parliament.

As for the cutting the top rate of tax, we are told that stamp duty increases for £2 million plus homes and other measures mean that this Budget will get 5 times more from the rich than this cut gives back. Again, I'll be looking to some independent analysis to see if it is true.

Rosie1980

In the mid-nighties the income tax threshold didn't change for two years running, so it was at the same rate for three years for everyone. I've always seen income tax threshold increases as a bonus not a given. This is only the same for pensioners now as it was then, their state pension will increase, their tax will remain unchanged. If no one was receiving an income tax threshold increase no one would be up in arms about how unfair it is. But because they have frozen one group until another catches up it is deemed unfair. Depends which side of 65 you are on as to whether or not you feel it's unfair. I do think the way the media portrays it as a loss for pensioners is very bad. My 87 year old Nan rang up asking if her pension was going down as she'd seen the news that pensioners would lose money. My answer was no Nan your pension will continue to increase. They are frightening old people by misleading reporting, at the end of the day what arrives in their bank account will continue to be the same, probably more (as the state pension increases) but certainly not less.

mgdavid

mmillie wrote: »

Did anyone read what saga have to say about this (on the BBC news);

I'm amazed that he had the gall to blame younger people for this. .......

er, Ros Altmann is
a) a woman
b) a former investment banker

what do you expect?

mgdavid

the only conclusion I draw from this thread is that almost all of the whingers simply cannot grasp simple arithmetic and simple English. One or two even admit it!
It's a catalogue of distortions, misunderstandings and in some cases total fabrication.

thorsoak

mmillie wrote: »

Did anyone read what saga have to say about this (on the BBC news);

I'm amazed that he had the gall to blame younger people for this. I don't believe that there is any evidence that the sub-prime mortgage lending was restricted to one demographic. There is however plenty of evidence that young people now struggle to afford a house while downsizing pensioners rake in a fortune from massively elevated house prices.

There is also evidence that employed people today are paying NI for today's pensioners to live on, but can't realistically expect the same from the next generation in 20 years time. The flow of money in this country has been disproportionately large towards the baby boomer generation, and no generation before or after will have it so good.

Don't get me wrong, I don't think these people did anything wrong at all. They are blameless beneficiaries of a nice economic period. I don't want to see any pensioner in financial trouble. However, I'm loosing all of my child support, which they got for their children. I received no family allowance for No 1 son, when DD was born, I then received 9s.0d (45p) per week for her, and then the same amount for Nos 2 & 3 sons.I'm paying a fortune for petrol, my petrol costs the same as yours now - your parents would have paid the same as we did then which they got cheaply for many years. I had loans to go to university, and my kids will pay an absolute fortune in tuition fees, which they got for free. All of this cost cutting is to keep our AAA rating, which ultimately benefits people receiving money from the government more than than people giving money to the government.

So given all the sacrifices I am making, and all of the additional costs and taxes that we are subjected to today, why is it so unfair to say that pensioners income is taxed the same as mine?

I was three when the Welfare State (including the NHS) as we know it came into being. Therefore one might say that I have been a beneficiary of the welfare state all my life ....should I be wearing sack-cloth and ashes and apologising to all youg people?

I was a teenager - hardly in a position to influence anything much - when Harold Macmillan (Tory PM) informed us that "we had never had it so good". But had "what"? We were all told that we should work hard at school, save, get jobs for life, etc etc etc. So we did - we worked hard at school, saved, got married, had children, bought houses as we had jobs for life.so we were told......

We worked hard, paid our taxes - yes our homes were cheaper - but wages were lower. Yes, we remortgaged - to help OUR children get on the property ladders and now, because we paid off the mortgage as we downsized - just as the bubble burst in 2008 - we considered that we were extremely lucky to be able to "swallow" the drop of almost £50k in order to sell our home of 38 years and still get a mortgage free small home.

However, because we scrimped, and I paid into a company pension scheme I now receive a small (nothing like the sum I was promised) pension and because I now own the house outright, I'm not entitled to any additional pension credit - so now, at age 68, widowed, I'm back at work, part time, on NMW because what we were told then was just froth and bubble.

And of course, I'm paying tax.

Just don't believe any of the politicians - its all froth and bubble.

Eco_Miser

ebjb wrote: »

Absolutely disgraceful taking money from the poorest pensioners to give to those who have more income. I say poorest pensioners because I believe anyone with over £25,400 get to keep the increased tax allowance ?

No, the poorest pensioners are not affected at all. They don't pay tax now, and they won't in future.
Those getting over £25,400 get to keep the increased Personal Allowance because they have already lost the Age Allowance, so their allowance is still less than that of over-65s getting less than that.
Those getting under £25,400, but enough to pay tax, don't change at all, but don't get an increase they may have expected.
Those who become 65 after 5 April 2013 definitely don't get an increase they expected (the Age Allowance).

Andy_Davies

pawnbroker wrote: »

I agree I found the comments ill advised to say the least.

As a baby boomer I have been taxed and lost out all time.

People have overlooked that we lost £25 off the heating allowance last year. So that's five weeks of the next increase accounted for to stay still.

As I understand it the greatest percentage of people in fuel poverty are guess what ..pensioners.

I had to accrue 44 years of NI contributions to get my full pension now it is given away for 30.

Pensioners on low income lost out over the 10p tax nonsense and never did get the money back.

Having had a reasonable job when we had three children at University simulataneously did we get any grant..no.

Teachers, civil servants etc are up in arms about their pensions, they were remarkably quiet when those of us lost some or all of the pension with Equitable life.

We have survived 15% mortgages.

We are currently receiving 90% less on our savings than we did 5 years ago.

Energy and car fuel are the same price for us, as is food.

Osborne and politicians once again have confirmed how detached they are from REAL life.

So whilst he endeavours to get more tax out of pensioners his government ladles increasing money into India,Kenya,Pakistan Somalia and any other open hand that wants money in deference to pensioners.

Boy are they going to suffer at the next election.

There is really nothing to match the sense of entitlement that the baby boomers have is there....

"I worked all my life and paid my stamp therefore I'm entitled to x, y and z now..."

The fact is no-one contributes enough in NI to ever fund what they they get as their pension.

The baby boomers lived through the greatest period of economic growth we had and most of it ended up in their pockets - through rising equities (who made the money on endowments), rising house prices etc. They also receive the greatest benefits from the massive amount of money that has been poured into the NHS.

The generations that are coming after are unlikely to do as well as the baby-boomers - pension provision has been decimated, massive growth in house prices means they are unaffordable (at worst), or will require huge mortgages at best, pension age is forever being pushed back etc.

If you've made it to retirement now, you're one of the lucky ones, you've been able to quit work earlier than the following generations and will most likely enjoy a long and healthy retirement paid for by others.

So I wouldn't complain too much...

gadgetmind

Andy_Davies wrote: »

The fact is no-one contributes enough in NI to ever fund what they they get as their pension.

Between employees and employers NI, a *huge* number of people pay *far* more NI than they will ever get back via pension.

Also bear in mind that pensions pay tax, and some pay more tax than they get as pension!