Labour propose confiscating 10% uk equities - pension planning response?

michaels

Paul_Herring wrote: »

Labour.

Private companies are to be forced to give up 1% per year of their equity for (at the moment) 10 years to the employees and the (Labour) Government.


https://www.ft.com/content/4cad1c50-bf59-11e8-8d55-54197280d3f7


https://www.bbc.co.uk/news/uk-politics-45621361


https://metro.co.uk/2018/09/24/john-mcdonnell-to-tell-labour-party-conference-he-wants-workers-to-get-10-of-companys-equity-7973124/

And the 'belonging to the workers bit' just seems to mean they get a profit share of up to 500pa whilst actual ownership of the shares and entitlement to any other dividend beyond the profit share will belong to the govt. Voting rights will belong to the govt/unions.....if it looks like a duck and quacks like a duck....

Filo25

michaels wrote: »

NIce 235% increase for us. Can't see them increasing my minimum wage and tax credits by enough to compensate!

Edit that is 375 per month for me to find out of my take home pay of 875 per month. No council tax benefit for us as we ha e savings of over 16k

Lucky me, it would just double ours!

Mind you they already proposed a 5% increase in my marginal rate of tax in their last manifesto no doubt it will be bigger next time around, clearly I need punishing as one of the rich overlords who could finally afford to be a first time buyer in their mid 40s

Sapphire

michaels wrote: »

And of course once you have established the principal of confiscating private assets no doubt it won't be long till you take another 10% to 'save the NHS' etc etc

Then you'll confiscate all the high-rise 'luxury' new-build developments and distribute them for free to 'the masses', thus having your Stalinist-style housing (slums of the future) without even having to actually build it. NB Relatives of mine living under a communist system actually had the flat that they had owned for many years cut in half, with the state confiscating half.

Run for the hills.

Malthusian

In response to the question asked by the thread, which is "what should your pension planning response be", not "what do you think about the anti-Semites' latest mad wheeze", the answer is to ensure your portfolio is geographically diversified to ensure that even if UK equities experienced total collapse as a result, the majority of your portfolio would still be there (and would expect to benefit from business flooding out of the UK and into overseas companies).

In general you should only have enough of your portfolio invested in any one particular area to ensure that you wouldn't be kicking yourself if it experienced a golden age of economic development and did ten times better than every other geographic sector. Even there was a general election tomorrow and all polls pointed towards a Corbyn victory, I still wouldn't sell out of the UK completely due to this kicking-yourself risk.

michaels

Malthusian wrote: »

In response to the question asked by the thread, which is "what should your pension planning response be", not "what do you think about the anti-Semites' latest mad wheeze", the answer is to ensure your portfolio is geographically diversified to ensure that even if UK equities experienced total collapse as a result, the majority of your portfolio would still be there (and would expect to benefit from business flooding out of the UK and into overseas companies).

In general you should only have enough of your portfolio invested in any one particular area to ensure that you wouldn't be kicking yourself if it experienced a golden age of economic development and did ten times better than every other geographic sector. Even there was a general election tomorrow and all polls pointed towards a Corbyn victory, I still wouldn't sell out of the UK completely due to this kicking-yourself risk.

What do you do about exchange rate risk if you are 90% outside uk and suddenly brexit becomes 'Norway' and the Tories win the next election comfortably and GDP hits 1.75?

Malthusian

michaels wrote: »

What do you do about exchange rate risk if you are 90% outside uk and suddenly brexit becomes 'Norway' and the Tories win the next election comfortably and GDP hits 1.75?

Use the 90% of my portfolio outside the UK to buy the 90% of stuff made outside the UK.

Use the other 10% of my portfolio and the 100% of my income earned within the UK to live like a king.

I would certainly not go around kicking myself that I didn't invest more in the UK, as it wouldn't have made enough difference in my life to be worth the risk of being 20% poorer (or worse) if Corbyn and co really had smashed the UK economy to pieces.

bostonerimus

Given the company money grab from workers' pay packets by the destruction of company DB plans and the shifting of both risk and contributions to employees with the introduction of DC plans, I think it's about time the employee got something back. Whether Labour's plans are the right way to do it is debatable, but the problem of income inequity needs to be addressed.

If I was a UK investor I wouldn't worry as I'd be globally diversified so the UK would probably be less than 10% of my portfolio....and who knows a falling pound might see my foreign investments buying a lot more when converted to pounds.

Terron

Silvertabby wrote: »

One of their other plans is to bin Council tax and reintroduce the old rates system, charging 0.8% per year of the property value. That would cost us an extra £50 per month, which we could swallow - but for the elderly lady living nearby that extra £50 (probably more if she lost her single occupants discount) would be the difference between 'heat or eat'. And we live in a relatively cheap housing area - property rich/cash poor pensioners living nearer London would see their council tax/rates bill quadruple. Perhaps that could be called 'Granny rates tax'.

To be fair that is not Labour party policy just a proposal made by a group led by the Mayor of Salford.

Paul_Herring

bostonerimus wrote: »

Given the company money grab from workers' pay packets by the destruction of company DB plans and the shifting of both risk and contributions to employees with the introduction of DC plans

Really? I remember it differently

https://www.telegraph.co.uk/news/uknews/1547173/Browns-pension-grab-secret-is-revealed.html

Gordon Brown was warned explicitly that he would cause the death of the final salary pension scheme and cost companies and individuals billions of pounds when he took the knife to the pension system in his first Budget.

Political meddling was not insignificant in the demise of DB pensions.

, I think it's about time the employee got something back. Whether Labour's plans are the right way to do it is debatable, but the problem of income inequity needs to be addressed.

The solution to the results of political meddling, is not more political meddling; it's less.

Filo25

Terron wrote: »

To be fair that is not Labour party policy just a proposal made by a group led by the Mayor of Salford.

Makes sense, a handy way to get London and the South East to subsidise the rest of the country even more than they do now