ESA question re' means testing

BigAunty

iolanthe07 wrote: »

. ...

You're wrong. There is no National Insurance Fund, and never was. Even Anauerin Bevin who set it up admitted it was a Ponzi scheme. In 1948 he said "The big secret about the National Insurance Fund is that there is no fund." National Insurance contributions are not ring fenced and go into the general taxation pot, out of which State pensions are paid.

But what if Pam sent an email sayin that there is a NIF? It would be an unchangeable fact...?!

BigAunty

seven-day-weekend wrote: »

When we lived abroad, ( and here in the UK) every letter my husband had from IB concerning his entitlement had a date on it by which it would be reviewed again. He knew he could lose it at any time due to being told he no longer qualified. That's why we didn't rely on it!

...

Boots has already indicated in an earlier post that she has an illness that won't recover from, therefore along with not anticipating that the criteria of benefits often change, they would have been similarly confident of remaining on IB in perpetuity. I imagine the move overseas was planned as pre-retirement step because they were doubly confident that sickness benefits would always be exportable and that they would always be sick.

sparkycat2

iolanthe07 wrote: »

. It is paid out of National Insurance Contributions with any shortfall being paid out of the National Insurance Fund

You're wrong. There is no National Insurance Fund, and never was. Even Anauerin Bevin who set it up admitted it was a Ponzi scheme. In 1948 he said "The big secret about the National Insurance Fund is that there is no fund." National Insurance contributions are not ring fenced and go into the general taxation pot, out of which State pensions are paid.

Forgive me if I believe the legislation, at least five departments of UK government, the Bank of England, and reports to UK parliment. That the NI fund exists and NI contributions are ring fenced. Rather than a quote that when I google comes up with a Telegraph newspaper article encouraging people to have private pensions.

If you bother to look in to the NI system and NI fund you will find lots of reports and accounts detailing it's existence, the management of the NI system and NI fund account and the legislation governing it.

The NI fund exists and NI contributions are ring fenced according to:
NI legislation
UK National Audit Office
Government Actuary Department
Her Majesty’s Revenue and Customs
Debt Management Office
Commissioners for the Reduction of the National Debt
The Bank of England

The UK government DMO currently manage the NI fund account which is currently in a on call notice deposit account at the Bank of England. They produce statements and reports featuring the account. That UK government HMRC produces a yearly National Insurance Fund annual account report to parliament. http://www.hmrc.gov.uk/about/ni-fundaccount10-11.pdf

According to the NI legislation. The National Insurance scheme is a pay as you go system with any surplus going in to the NI fund, and any shortfall being taken out of the NI fund. The National Insurance contributions are ring fenced. With the exception made by the National Insurance Acts 2002 chapter 12 provision to use a portion of the NI contributions to help pay towards the day to day running costs of the NHS. The only reason the NI fund is not growing year on year is because of the syphoning off of some of the NI contributions money each year since 2002.

Prior to 2007 the NI fund was in UK government gilts, since 2007 it has been in a UK government DMO managed on call notice account at the Bank of England. The shift from UK Gilts to BOE account has resulted in less interest being paid to the account.

The NI system is being slowly or not so slowly done away with for political reasons not economic. They seem to want to do away with National Insurance and create more of a market for private insurance for unemployment and incapacity and private pensions.

sparkycat2

FBaby wrote: »

You say WHEN I think IF. That's the difference. Yes I do think I should be entitled to it considering the level of tax I pay but do I think I will get it in 20 years time? The way things are going I am not counting on it.

Any changes to underlying entitlement to a sate pension I expect will be long notice and not applied to current claimants of state pension, the legacy claimants. So people have time to make plans.

The changes to NI contributions based ESA WRAG are being applied to current claimants, legacy claimants. That is like paying for private incapacity insurance with income replacement until fit for work or they die. Then falling ill or becoming disabled and unable to work. Making a claim on the insurance. Being paid. Then years latter the insurance company unilaterally decides that despite you still being unable to work due to ill health or disability it is not going to pay your income replacement for life but time limit it to one year. Your screwed.

It is not even justified on grounds of the NI scheme being unsustainable. NI income exceeds NI outgoings, it is only after the government syphons off £20bn to the NHS that the fund is running at a slight loss, and that syphoning off required the government to change the law in 2002 to enable the government to steal NI contributions from the scheme. The fund also has tens of billions in the NI fund account.

FBaby wrote: »

And how about ask Therese people who lost all their savings through the bank disaster maybe they had mace plans rio move abroad and saw their dream shattered through no fault of theirs. The difference is this people made the choice to do with less at a time in their life for that benefit and still lost it that's why I have limited sympathy.

"do with less at the time"
NI contributions are deducted from pay.

"Saw their dreams shattered through no fault of their own"
They gambled on private sector financial products and lost.
Those paying NI "gambled" on the Government providing the insurance they paid for, honoring the basic principles of the scheme like every previous government since the founding of the NI scheme.

"their dreams shattered"
Those on contributions based ESA WRAG after one year will only get ESA WRAG if they are in household poverty and resident in the UK. Not the insurance they paid for that would of enabled them to live with dignity as they pleased and where they pleased.

I have more sympathy for those unable to work due to ill health or disability who "gambled" on the government honoring the insurance they paid for, many of whom will now end up in poverty. Than for investors who gambled in private sector financial products and lost their nest eggs.

iolanthe07

From the National Pensioners' Convention:

It is quite clear that millions of pensioners, workers and their employers have no idea that the money being paid in National Insurance every month is not being used to pay higher pensions and benefits – but is instead being used to balance the government’s books. As a direct result, the state pension is being kept unacceptably low and millions of older people are facing financial difficulties.
It’s time the government stopped using NI as just another form of general taxation, owned up about the way it is using the fund and started to use the surplus to raise the basic state pension and strengthen the existing NI based pension as the most effective way of tackling pensioner poverty, both now and in the future.

FBaby

sparkycat2 wrote: »

Any changes to underlying entitlement to a sate pension I expect will be long notice and not applied to current claimants of state pension, the legacy claimants. So people have time to make plans.

Because people on ESA haven't had the time to plan that things could change? Why is it that they have a year to continue to claim? Isn't that to allow to make time to make plans?

sparkycat2 wrote: »

"Saw their dreams shattered through no fault of their own"
They gambled on private sector financial products and lost..

Oh, and people who assumed that they would get IB/ESA for the rest of their lives didn't gamble believing that they would get it for the rest of their lives?

I have more sympathy for those unable to work due to ill health or disability who "gambled" on the government honoring the insurance they paid for, many of whom will now end up in poverty. Than for investors who gambled in private sector financial products and lost their nest eggs.

I don't. I think both made choices in their lives that didn't go the way they plan. No one has to live in poverty, they will just have to give up their dream of living abroad. No difference.

sparkycat2

FBaby wrote: »

Because people on ESA haven't had the time to plan that things could change? Why is it that they have a year to continue to claim? Isn't that to allow to make time to make plans?

No it is because the government is portraying ESA WRAG as if it is JSA for unemployed disabled people who can work.

Contributions based JSA is time limted to 6 months, they are expected to find employment within 6 months. Contributions based ESA WRAG is time limited to 12 months, as if they are expected to find employment within 12 months.

Only problem ESA WRAG is for people who have been assessed as having significantly limited work capability to the extent that they are deemed unable to currently work. They have been assessed as capable of appropriate for their conditon work related activity, not work.

FBaby wrote: »

Oh, and people who assumed that they would get IB/ESA for the rest of their lives didn't gamble believing that they would get it for the rest of their lives?

They trusted the government and the National Insurance scheme. That as long as they were not able to work due to ill health or disability, and deemed as such by the state. They would continue to receive national insurance contributions based income replacement benefit. It is what they paid NI for and what they were told.

FBaby wrote: »

I don't. I think both made choices in their lives that didn't go the way they plan. No one has to live in poverty, they will just have to give up their dream of living abroad. No difference.

To receive income based ESA WRAG you have to be resident in the UK and meet the means test. To receive mean tested ESA WRAG without any deductions.
Household income no more than £7,500 a year (£144.23 a week)
Household savings no more than £6,000

The official UK poverty line
Single adult £165 a week
Couple £248 a week

ESA WRAG is £99.15 a week

sparkycat2

iolanthe07 wrote: »

From the National Pensioners' Convention

You might choose to see it as a matter of opinion where everyone's opinion be it a quote attribute to Bevin that appears to be lifted from a Telegraph newspaper article promoting private pensions or a quote that you attribute to the National Pensioners Convention that appears to be taken out of context from Mature Times, as having equal credence as UK NI legislation, HMRC NI reports to Parliment, DMO NI accounts, many other government department reports, Bank of England reports, etc... Leaving you free to choose who and what you want to believe.

I take some sources of information as having more credence than others and some as being definitive to the point of being factually correct. So I will choose to believe the UK NI legislation, HMRC NI reports to Parliment, DMO NI accounts, many other government department reports, Bank of England reports, etc...

Maybe you do not comprehend the difference between the NI fund lending the UK government at interest and the NI fund money being given to the UK government. Maybe you do not comprehend the reason for the 2002 NI act enabling some £20bn a year to be syphoned of from NI contributions to help pay towards running costs of the NHS rather than going into the NI fund, or why in 2007 the government switched the NI fund account from UK government gilts to the lower interest paying BoE account managed by the DMO, or why the government wants to do away with NI including the NI fund and just have income tax and government money. It is because money lent to the government by the NI fund is money owed by the government to the NI fund. As well as having a fund account of tens of billions the NI scheme income stream (before money is syphoned off to the NHS) is greater than its out goings. It is a cash cow the government wants to milk for its own ends rather than using the NI contributions payers money for NI contributions based benefits, which is what the scheme was set up to do, provide National Insurance.

Boots888

BigAunty wrote: »

That's interesting - can't wait to see the DWP response to one person arguing they should have an exception to a national benefit policy change. Do come back to the forum and let us know how you get on.

NO:mad:

"Please re-read your posts to SDW and then climb down from your moral highground."

I'm already flat on my face;)

Watch out all you disabled folk!! Big Aunties got to the nub of the matter here:

"What you have is a privilege that you have taken to be your right"

Bloody cheek:eek::rotfl:


Oh and I think you should stop mentioning Pam - she retired a few years ago, before the changes to civil servent pensions, working conditions and the strikes etc.

Good luck to her, she was a very nice lady and gave me the correct advice