Chancellor Rishi Sunak hints at ruling out 8% pension rise

Eldi_Dos

dunstonh said:

Eldi_Dos said:

dunstonh said:

aardvaak said:

Pensioners have suffered a decrease in income during the pandemic and deserve the increase they can not work and have no other means of support

That is highly unlikely as 
1) state pension has continued to rise each year
2) occupational pensions have continued to rise each year
3) annuities have continued to pay the agreed terms
4) investment back drawdown has seen values rise over the period allowing continued income.

What income have you had that has fallen?

Savings income.

Most people do not use savings as a means to provide income (although it is often used to eat capital for short term periods)  and the low interest rates are not to do with the pandemic and have been low for over a decade.

Hi meant to reply yesterday evening but it all tuned a bit HYS Friday night on here so decided to wait till this morning. What you say may be so for most people but does not alter that pensioners income from savings have dropped. When we get to pension age  and get our lump sums and other money we do not suddenly become savvy on investing and indeed many would consider it unwise at that stage of life. The policy of low interest rates helps people who are servicing debts for whatever reason but does not benefit pensioners savings, indeed we have what I consider to be a ludicrous situation of people putting tens of thousands into Premium Bonds in the hope of a win. In our local in the first week of the month bond wins is one of the most common topic's of conversation even taking precedence over cholesterol levels and scorecards.

Thrugelmir

zagfles said:

michaels said:

zagfles said:

Alexland said:

Albermarle said:

However the rise in earnings will be recalculated in some way just for this years calculation ,to take account of the special circumstances .

Yes I think most voters and pensioners would accept that the triple lock wasn't intended and wouldn't be appropriate for these circumstances and so by exception a longer measurement period should be used that covers the volatility in earnings caused by the pandemic ensuring that over several years the SP has grown by the greater of the three measures which is still a good result for those benefiting and shouldn't cause any reasonable retirement plans to fail.

Indeed, any reasonable person would agree. But it'll still be endlessly expolited by those who want to use it as a political weapon, although I think it will backfire...

That is what I thought but reading the BBC HYS comments on it the opinion being expressed is very much that pensioners would be being screwed and should never vote Tory again

Presumably a kite is being flown and the final outcome will depend on the feedback - £3bn per year is a lot to buy the votes of people who will definitely grumble but probably vote Tory anyway.

I wouldn't take much notice of BBC HYS, it's getting as bad as tw*tter!

Seems pointless HYS. No sensible debate. Just gets flooded with dirge. Everybody wants free money these days it seems. 

mark55man

OldScientist 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.

Rather sadly I recently calculated my 'NI pot' - had it been invested at 6% nominal growth since I started work in the 80s, it would now provide an income (assuming a 4% rule of thumb) of about £7.5k. Of course, NI payments were originally intended to support the NHS as well as pensions and other benefits so only a fraction of this 'income' would actually be available to pay a pension based on what I contributed.

There was a thread where I said something like the NI pot was worth 300K or so, and was better value than almost anything and like I couldn't see how it was covered by contributions.  I got slightly taken to task in an educational sort of way, in that the NI doesn't just do pensions it covers a lot of other spending (although no-one will ever set firm boundaries), but that the reason why it could afford all this is that it is like the annuity only more so, in that some people die before ever seeing a penny back, and others before they see a return of contributions.  But that's OK because it might be you who lives to 100+

xylophone

State pension is not a benefit,it’s an earned and paid for return on 50 years of investment. 

https://petition.parliament.uk/archived/petitions/121267

Some people have a negative association with the word ‘benefit’ as synonymous with the means test; however this legal description provides consistency with other contributory benefits.

It is, of course, also consistent with private pensions where traditional pension schemes which are earnings linked such as final salary schemes, known as ‘Defined Benefit’ schemes. The pension paid out by these schemes is defined as a ‘benefit’.State Pension entitlement is based on having paid into the National Insurance scheme for a required number of years. However, use of the word “benefit” for retirement pension (latterly known as State Pension) has always been classified in law from the time of the1946 National Insurance Act, which applied from the inception of the National Insurance scheme. No offence is intended by the use of this term.Furthermore, the term “contributory benefit”, forms the legislative framework of the Social Security Contributions and Benefits Act 1992. Section 20 of that Act is entitled “Descriptions of contributory benefits”. Contributory benefits under Part II of that Act are listed, and the sixth is retirement pensions.In addition, the introduction of the new State Pension from 6 April 2016 is also classified as a “benefit” under Section 1(1) of the Pensions Act 2014.This word is also used to describe the advantages (benefits) provided through private pension arrangements.Department for Work and Pensions

 

mark55man

@xylophone whilst I agree with you and your definitions are straight out of fact/law/statute - I think the emotion in the word is that the "benefit" word is also associated with other more negative words - ie benefit cuts, benefit scroungers, means-tested benefits, benefit fraud in a way that earned/contribution based entitlement doesn't.  It thus makes it easier for politicians to play politics and weakens what is a reasonably united front from older voters

Ganga

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 .

mark55man

I don't think the government has a record of doing that.  Some government pension schemes do, some don't - 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)  

JJC1956

SomeMadeUpName said:

mark55man said:

Dazed_and_C0nfused said:

Winter Fuel Payment

Christmas Bonus
Bus pass
Eye test
Prescriptions

Yes, but apart from all that (and no NI) what has the pension ever provided that those in other countries have to pay for

What have the Romans ever done for us?

I’m Spartacus

mark55man

NO, I'm Spartacus

Thrugelmir

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