Huge cuts or tax rises needed to pay for ageing population

mystic_trev

It's those pesky Boomers again!

UK taxpayers were being kept in the dark about the large scale of spending cuts or tax rises needed to fund future pension and social obligations for an ageing population, the Institute of Economic Affairs said.

The country faced a stark choice between total spending cuts of more than a quarter, health and social protection spending cuts of 50%, or "significant" tax hikes if long-term obligations were to be met, the free-market champions said.

http://www.theguardian.com/politics/2014/mar/13/spending-cuts-tax-rises-ageing-population-thinktank

Aso here.

http://www.telegraph.co.uk/finance/economics/10693317/UK-faces-crippling-tax-rises-and-spending-cuts-to-fund-pensions-and-healthcare.html

and here.

http://www.thisismoney.co.uk/money/news/article-2579601/Britain-faces-huge-tax-hikes-draconian-cuts-health-social-spending-pay-elderly-warns-new-report.html

purch

It's not just the U.K., this also effects most Western economies, and even some Asian economies too.

....and it's a problem that will grow year by year.

chucknorris

purch wrote: »

It's not just the U.K., this also effects most Western economies, and even some Asian economies too.

....and it's a problem that will grow year by year.

There are major changes coming to the state pension, but they are waiting until 7 January 2024 to implement them (that's one day before I reach state pension age). It's bit more tricky for them with the NHS because they can't work out when/if I'll actually need it.

HAMISH_MCTAVISH

a stark choice between total spending cuts of more than a quarter, health and social protection spending cuts of 50%, or "significant" tax hikes

There is of course, another option... :whistle:

wotsthat

The country faced a stark choice between total spending cuts of more than a quarter, health and social protection spending cuts of 50%, or "significant" tax hikes if long-term obligations were to be met, the free-market champions said.

Don't see why it's a stark choice between massive spending cuts or massive tax rises to be honest.

Probably a mix of tax rises, spending cuts, some immigration, longer working lives etc.

Plus, of course, 'long term obligations' don't have to be fully met - why would a politician in 2030 feel obliged to keep the promises of a politician from a previous generation?

Judging by the lard-asses waddling around the UK people are either unaware of the healthcare problems heading this way or are expecting a future NHS to perform miracles.

Bantex_2

HAMISH_MCTAVISH wrote: »

There is of course, another option... :whistle:

Agree.
Free cigarettes and an aggressive government pro smoking campaign could do the trick.

michaels

I thought Hamish said the immigration ponzi scheme would protect us from harsh choices.

Of course the reality is that the state pension will be means tested so those who have .made their own provision will lose out.

smartn

michaels wrote: »

I thought Hamish said the immigration ponzi scheme would protect us from harsh choices.

Of course the reality is that the state pension will be means tested so those who have .made their own provision will lose out.

It's an interesting prospect. It wont go down well if those that have been paying NI contributions for 40+ years end up with nothing because they saved and the ones who have wasted all there cash end up with a state pension.......

Generali

purch wrote: »

It's not just the U.K., this also effects most Western economies, and even some Asian economies too.

....and it's a problem that will grow year by year.

Australia was amazingly forward looking in setting up the Super scheme so liabilities aren't accruing at anything like the rate seen in other countries and the Future Fund to pay for existing liabilities. The Future Fund isn't there yet but it is getting there. The average Australian that invests with the company I work for should have a super pot equivalent to about 10x their final salary or thereabouts. That's our target for them. That means the average Australian couple would retire with a pot of $500,000 which is pretty good.

Of course the idiot Labor Government couldn't help but raid it when a combination of tax rises and borrowing wasn't enough to fund their profligacy and corruption (e.g. link, link, link, link, link) but thankfully most of it remains.

Bantex_2

smartn wrote: »

It's an interesting prospect. It wont go down well if those that have been paying NI contributions for 40+ years end up with nothing because they saved and the ones who have wasted all there cash end up with a state pension.......

Already happening. If you save for your old age and need to get nursing care, the fees will be taken from your savings. If you spent the lot on gambling and foreign holidays the state will pick up the bill. There does appear to be a fundamental dislike of savers and a feeling they should be punished.

smartn

Bantex wrote: »

Already happening. If you save for your old age and need to get nursing care, the fees will be taken from your savings. If you spent the lot on gambling and foreign holidays the state will pick up the bill. There does appear to be a fundamental dislike of savers and a feeling they should be punished.

Currently I see no reason not to retire early, blow my pension fund, pass my money on to the kids and make sure the state picks up the tab for me in my later stages of life.....