Chancellor Rishi Sunak hints at ruling out 8% pension rise

zagfles

Thrugelmir said:

zagfles said:

steampowered said:

michaels said:

So lets see, the working age population who pay the pensioners incomes through their tax all put their lives on hold for over a year many suffering considerable financial hardships pretty much to save the lives of the pensioners (look up the deaths data 90% plus are over pension age) should now pay an extra £2bn in tax not just this year but every year so those same pensioners can all se a big jump in their standard of living whilst those same tax payers have almost all seen a fall in theirs.

I thought it was the young who were supposed to be the Me Me Me greedy generation....

I agree with you. The triple lock is and always was a stupid policy. All part of presenting the Conservative party as on the side of the older generations (without actually doing anything immediate). 

But, the triple lock was a key headline policy of the government which was elected. The whole point of British democracy is that the government is supposed to implement its manifesto. 

So what, Labour broke their headline promise not to raise tax rates after the financial crisis. If a crisis happens (or sometimes even if not) manifesto promises go out of the window.

Brown promised not to increase income tax. Instead progressively raised National Insurance rates. To avoid media headlines. The increases were never immediate but hidden in the red book for the following tax year after the budget. Smoke and mirrors...... At the end of the day there's no free lunches. 

That didn't technically break the promise, but the rise in the top rate of tax after the financial crisis did.

Not to say they only break promises in a crisis, they promised not to implement uni top up fees in 2001 then did it in 2004. Then had the hypocrisy to critice the Lib Dems for breaking their uni fees promise in 2010, when at least they had the excuse of being in a coalition.

Notepad_Phil

Ganga said:

Notepad_Phil said:

beduth said:

steampowered said:

daveyjp said:

The world of the 60s, 70s when current pensioners were starting out in life, was very much different to today, even more so for women.

Sorry, why couldn't people who started work in the 60s and 70s save for their retirements during the course of their working lives?

If you haven't put aside anything from your retirement, why should it be the government's job to top that up through the benefit system (and the state pension is a benefit). It shouldn't. No more than it should be the government's job to give you a lavish lifestyle if you are on working age benefits. 

People who worked in the 70s did save. They also paid national insurance contributions for 50 years.
State pension is not a benefit,it’s an earned and paid for return on 50 years of investment. 

I think you may need to revise your opinions if you believe that the state pension comes from investing your national insurance. My first job was in the 70's and even at that young age I knew that my national insurance had nothing to do with being invested for my future state pension and that any bearing on state pensions was solely to pay the state pensions of those who were currently retired.

Was not the extra that we paid in the 60s /70s ie Graduated Contributions not for our use in the future ,that is to enhance our pensions .

Yes they were indeed to enhance your pension, just like Serps and S2P did later. But they weren't invested in a pot somewhere and when it comes to paying them out the government takes the money from wherever they need to.

GunJack

Thrugelmir said:

At the end of the day there's no free lunches. Spending commitments have to be paid for. The pandemic bill has yet to be dealt with in the years ahead. 

agreed.... I'd go for a 1-year increase in basic rate to 25% and bin HRT relief on pension conts., that should make enough of a dent in it for more moderate measures from year 2 onwards...

Albermarle

 Spending commitments have to be paid for. The pandemic bill has yet to be dealt with in the years ahead. 

Problem is that Boris will do anything to try and avoid doing anything that might be unpopular. 
Probably easier for him to let the debt rack up, and let someone else deal with the financial crisis down the line. 

bostonerimus

I rarely find myself agreeing with this Government, but I'd support breaking the triple lock if it dictated an 8% rise to the state pension as that's a one time anomaly. The criticism I have is for politicians coming up with veinal policies like the triple lock designed to buy votes. The bigger issue is the staggeringly low level of the UK state pension compared to other developed countries and the decades of austerity forced on great British institutions by recent governments. Funding cuts to NHS, police, broadcasting, and worst of all the introduction of  students being charged university fees. and the lack of regard for rules and standards exemplified in the Grenfell disaster and the recent  conviction of Southern Water for polluting have turned the UK into a second world country...third world status looms.

xylophone

but I'm pretty sure that state pension is not paid out of a wealth fund type arrangement but this years pensions are paid out of this year's funds (may be some sort of "balance" but not from decades ago)  

https://www.researchgate.net/publication/228426465_The_History_of_State_Pensions_in_the_UK_1948_to_2010

From the outset, the objective was not to provide a high replacement

income for most wage-earners but to provide a safety net against old-age

deprivation. Beveridge’s proposal was that individuals would be provided

with a flat-rate income in old age that would be just sufficient to lift them

above an absolute measure of poverty. This income was to be funded

through contributions paid during working life. These contributions were

to be calculated on an actuarially fair basis. In other words, the weekly

amount paid would be that which, over the course of a working life, would

finance the proposed retirement pension (and also finance the average

expected incidence of sickness and unemployment, which were also to be

insured through Beveridge’s new system).

The National Insurance Act 1946 introduced the BSP, with effect from

1948, but right from the start it differed from the proposals of the

Beveridge Report. Political considerations made it impossible to

implement the fully funded scheme that Beveridge had envisaged because

such a scheme made no provision for pensions for those already older

individuals who had suffered through the Great Depression and

contributed to the war effort. Faced with the significant immediate bill of

paying pensions to individuals who had not made contributions, the

government opted to introduce a ‘pay-as-you-go’ system rather than a

funded one. Individuals paid contributions (known as National Insurance

(NI) contributions), but instead of the level of these being related to an

individual’s own future pension benefits (as Beveridge had envisaged),

they were related to what was needed to fund the benefits of current

pensioners. Over time, the link between a person’s contribtributions and the

pension income that person receives has become even weaker, as NI rates

are now set simply according to the overall budgetary needs and

distributional objectives of the government and are not directly related to

either future pension benefits or current pension funding needs.

xylophone

Was not the extra that we paid in the 60s /70s ie Graduated Contributions not for our use in the future ,that is to enhance our pensions .

See link cited in my post above.

The first earnings-related state pension to be implemented, in 1961, was

the graduated retirement benefit (GRB). The idea was that wage-earners

would have to make mandatory contributions up to a certain level of

earnings; these contributions would allow workers to buy ‘units of

pension’ that would be convertible into a weekly income according to the

value of these ‘graduated pension units’. However, to reduce the cost, the

government did not increase the nominal value of pension units between

1961 and 1978, despite cumulative inflation over this period of nearly

300%. Thus this social insurance scheme died almost at birth because of

the government’s refusal to accept its inherent cost.

Thrugelmir

zagfles said:

Thrugelmir said:

zagfles said:

steampowered said:

michaels said:

So lets see, the working age population who pay the pensioners incomes through their tax all put their lives on hold for over a year many suffering considerable financial hardships pretty much to save the lives of the pensioners (look up the deaths data 90% plus are over pension age) should now pay an extra £2bn in tax not just this year but every year so those same pensioners can all se a big jump in their standard of living whilst those same tax payers have almost all seen a fall in theirs.

I thought it was the young who were supposed to be the Me Me Me greedy generation....

I agree with you. The triple lock is and always was a stupid policy. All part of presenting the Conservative party as on the side of the older generations (without actually doing anything immediate). 

But, the triple lock was a key headline policy of the government which was elected. The whole point of British democracy is that the government is supposed to implement its manifesto. 

So what, Labour broke their headline promise not to raise tax rates after the financial crisis. If a crisis happens (or sometimes even if not) manifesto promises go out of the window.

Brown promised not to increase income tax. Instead progressively raised National Insurance rates. To avoid media headlines. The increases were never immediate but hidden in the red book for the following tax year after the budget. Smoke and mirrors...... At the end of the day there's no free lunches. 

That didn't technically break the promise, but the rise in the top rate of tax after the financial crisis did.

Forget the promise. Brown had to fund his expansion of the welfare state and growth in public sector headcount. One way or the other tax revenues had to be raised. Giveth with one hand and take away with the other. Burying the detail in the red book was the deceitful aspect. 

Thrugelmir

bostonerimus said:

I rarely find myself agreeing with this Government, but I'd support breaking the triple lock if it dictated an 8% rise to the state pension as that's a one time anomaly. The criticism I have is for politicians coming up with veinal policies like the triple lock designed to buy votes. The bigger issue is the staggeringly low level of the UK state pension compared to other developed countries and the decades of austerity forced on great British institutions by recent governments. Funding cuts to NHS, police, broadcasting, and worst of all the introduction of  students being charged university fees. and the lack of regard for rules and standards exemplified in the Grenfell disaster and the recent  conviction of Southern Water for polluting have turned the UK into a second world country...third world status looms.

For a US resident of many decades. The expression "people who live in glass houses shouldn't throw stones springs to mind".  American exceptionalism is what's polluting culture on many levels globally.  

zagfles

bostonerimus said:

I rarely find myself agreeing with this Government, but I'd support breaking the triple lock if it dictated an 8% rise to the state pension as that's a one time anomaly. The criticism I have is for politicians coming up with veinal policies like the triple lock designed to buy votes. The bigger issue is the staggeringly low level of the UK state pension compared to other developed countries and the decades of austerity forced on great British institutions by recent governments. Funding cuts to NHS, police, broadcasting, and worst of all the introduction of  students being charged university fees. and the lack of regard for rules and standards exemplified in the Grenfell disaster and the recent  conviction of Southern Water for polluting have turned the UK into a second world country...third world status looms.

This from someone who, AIRI, lives in the US What are student fees there? What is publicly funded healthcare like there? If the US is first world I prefer second world. People risk their lives to get here, from France!

You need to check your "facts" as well. NHS spending is constantly increasing, even in real terms, even before the pandemic. Don't lecture us about Grenfell till Miami is explained, the 2018 inspection would appear to have highlighted design errors.

And you complain about the state pension being "staggeringly low" but don't support an 8% rise Anyone who understands the UK benefits system knows that contributory benefits are low, but means tested benefits are among the best in the world. Plus the UK has generally better employer pension provision than countries who rely on the state more.