Move the State Pension age back to 60 for both men & women

nigelbb

jamesd said:

nigelbb said:

jamesd said:

A crude look at the financial cost. It's roughly a 25% increase in pensioners and since the state pension is paid for out of the NI from working people that implies a 25% increase in NI. NI today is largely 12% employee and 13.8% employer for a combined 25.8% so the result would be an increase in NI of around 7%.

This ignores the reduced number of workers from earlier retiring, the different NI rates and the use of some NI for the NHS and working age benefits but it gives a reasonable if crude idea of how much the proposal would hurt workers. Young workers are likely to be particularly badly affected by the reduced take home pay or employers deciding that the higher NI makes some of them not worth employing.

Sounds good to me. If earning £100K per year you would only pay about £410 extra National Insurance per year. 

7% of the portion above the higher rate threshold is around £3,500. On top of the extra 7% on most of the part below that. Unless employers are made to pay some of it.

I don't know where you get your figures from but according to https://www.thesalarycalculator.co.uk on a salary of £100K the amount of NI paid per year is £ 5,878.84. I make 7% of that £406.

Silvertabby

nigelbb said:

jamesd said:

nigelbb said:

jamesd said:

A crude look at the financial cost. It's roughly a 25% increase in pensioners and since the state pension is paid for out of the NI from working people that implies a 25% increase in NI. NI today is largely 12% employee and 13.8% employer for a combined 25.8% so the result would be an increase in NI of around 7%.

This ignores the reduced number of workers from earlier retiring, the different NI rates and the use of some NI for the NHS and working age benefits but it gives a reasonable if crude idea of how much the proposal would hurt workers. Young workers are likely to be particularly badly affected by the reduced take home pay or employers deciding that the higher NI makes some of them not worth employing.

Sounds good to me. If earning £100K per year you would only pay about £410 extra National Insurance per year. 

7% of the portion above the higher rate threshold is around £3,500. On top of the extra 7% on most of the part below that. Unless employers are made to pay some of it.

I don't know where you get your figures from but according to https://www.thesalarycalculator.co.uk on a salary of £100K the amount of NI paid per year is £ 5,878.84. I make 7% of that £406.

But wouldn't it be an extra 7% from the salary, not just the existing NI?

QrizB

Silvertabby said:

nigelbb said:

jamesd said:

nigelbb said:

jamesd said:

A crude look at the financial cost. It's roughly a 25% increase in pensioners and since the state pension is paid for out of the NI from working people that implies a 25% increase in NI. NI today is largely 12% employee and 13.8% employer for a combined 25.8% so the result would be an increase in NI of around 7%.

This ignores the reduced number of workers from earlier retiring, the different NI rates and the use of some NI for the NHS and working age benefits but it gives a reasonable if crude idea of how much the proposal would hurt workers. Young workers are likely to be particularly badly affected by the reduced take home pay or employers deciding that the higher NI makes some of them not worth employing.

Sounds good to me. If earning £100K per year you would only pay about £410 extra National Insurance per year. 

7% of the portion above the higher rate threshold is around £3,500. On top of the extra 7% on most of the part below that. Unless employers are made to pay some of it.

I don't know where you get your figures from but according to https://www.thesalarycalculator.co.uk on a salary of £100K the amount of NI paid per year is £ 5,878.84. I make 7% of that £406.

But wouldn't it be an extra 7% from the salary, not just the existing NI?

Yes, exactly that. Jamesd is suggesting that if the number of pensioners increases by 25% then the total NI take would have to increase by 25% too. If shared equally amongst employers and employees in the current ratios, that would mean a £100k pa employee currently paying £5878.84 would pay an extra £1469.71 pa in NI.

nigelbb

Silvertabby said:

nigelbb said:

jamesd said:

nigelbb said:

jamesd said:

A crude look at the financial cost. It's roughly a 25% increase in pensioners and since the state pension is paid for out of the NI from working people that implies a 25% increase in NI. NI today is largely 12% employee and 13.8% employer for a combined 25.8% so the result would be an increase in NI of around 7%.

This ignores the reduced number of workers from earlier retiring, the different NI rates and the use of some NI for the NHS and working age benefits but it gives a reasonable if crude idea of how much the proposal would hurt workers. Young workers are likely to be particularly badly affected by the reduced take home pay or employers deciding that the higher NI makes some of them not worth employing.

Sounds good to me. If earning £100K per year you would only pay about £410 extra National Insurance per year. 

7% of the portion above the higher rate threshold is around £3,500. On top of the extra 7% on most of the part below that. Unless employers are made to pay some of it.

I don't know where you get your figures from but according to https://www.thesalarycalculator.co.uk on a salary of £100K the amount of NI paid per year is £ 5,878.84. I make 7% of that £406.

But wouldn't it be an extra 7% from the salary, not just the existing NI?

I was responding to the the claim that this proposal would require an increase in NI of around 7%. In fact I see now it's not a 7% increase but 25% that is required.

I still think that for someone earning £100K per year to pay an extra £1,500 per year to be able to draw their state pension at 60 is a great deal.

zagfles

nigelbb said:

Silvertabby said:

nigelbb said:

jamesd said:

nigelbb said:

jamesd said:

A crude look at the financial cost. It's roughly a 25% increase in pensioners and since the state pension is paid for out of the NI from working people that implies a 25% increase in NI. NI today is largely 12% employee and 13.8% employer for a combined 25.8% so the result would be an increase in NI of around 7%.

This ignores the reduced number of workers from earlier retiring, the different NI rates and the use of some NI for the NHS and working age benefits but it gives a reasonable if crude idea of how much the proposal would hurt workers. Young workers are likely to be particularly badly affected by the reduced take home pay or employers deciding that the higher NI makes some of them not worth employing.

Sounds good to me. If earning £100K per year you would only pay about £410 extra National Insurance per year. 

7% of the portion above the higher rate threshold is around £3,500. On top of the extra 7% on most of the part below that. Unless employers are made to pay some of it.

I don't know where you get your figures from but according to https://www.thesalarycalculator.co.uk on a salary of £100K the amount of NI paid per year is £ 5,878.84. I make 7% of that £406.

But wouldn't it be an extra 7% from the salary, not just the existing NI?

I was responding to the the claim that this proposal would require an increase in NI of around 7%. In fact I see now it's not a 7% increase but 25% that is required.

I still think that for someone earning £100K per year to pay an extra £1,500 per year to be able to draw their state pension at 60 is a great deal.

It's obvious that he was referring to NI rates, not take, being increased by 7%, eg employee rates going from 12%/2% to 19%/9%. That would be a £6330 increase for someone on £100k.

zagfles

Dale72 said:

qwert10 said:

https://petition.parliament.uk/petitions/581736

50k signatures so far

I think this place is a little too reactionary for ideas like that. I'm surprised no ones suggested the young people get jobs picking fruit and veg to replace the EU migrants,

How reactionary - us British harvesting our own crops! Surely that's what foreigners are there for, toiling on the plantation while we put our feet up at 60. Next the reactionaries will be suggesting we sack our filipino maid and do our own cleaning

nigelbb

zagfles said:

nigelbb said:

Silvertabby said:

nigelbb said:

jamesd said:

nigelbb said:

jamesd said:

A crude look at the financial cost. It's roughly a 25% increase in pensioners and since the state pension is paid for out of the NI from working people that implies a 25% increase in NI. NI today is largely 12% employee and 13.8% employer for a combined 25.8% so the result would be an increase in NI of around 7%.

This ignores the reduced number of workers from earlier retiring, the different NI rates and the use of some NI for the NHS and working age benefits but it gives a reasonable if crude idea of how much the proposal would hurt workers. Young workers are likely to be particularly badly affected by the reduced take home pay or employers deciding that the higher NI makes some of them not worth employing.

Sounds good to me. If earning £100K per year you would only pay about £410 extra National Insurance per year. 

7% of the portion above the higher rate threshold is around £3,500. On top of the extra 7% on most of the part below that. Unless employers are made to pay some of it.

I don't know where you get your figures from but according to https://www.thesalarycalculator.co.uk on a salary of £100K the amount of NI paid per year is £ 5,878.84. I make 7% of that £406.

But wouldn't it be an extra 7% from the salary, not just the existing NI?

I was responding to the the claim that this proposal would require an increase in NI of around 7%. In fact I see now it's not a 7% increase but 25% that is required.

I still think that for someone earning £100K per year to pay an extra £1,500 per year to be able to draw their state pension at 60 is a great deal.

It's blatently obvious that he was referring to NI rates, not take, being increased by 7%, eg employee rates going from 12%/2% to 19%/9%. That would be a £6330 increase for someone on £100k.

No. Increasing a rate by 7% is increasing it by 7% not by 60% or 350% or whatever.

I'm not even sure where the 7% comes from as in rough figures increasing the number of years a pension would be paid (given average life expectancy) from 20 years to 25 years requires a 25% increase in funding not the well over 100% you claim.

zagfles

nigelbb said:

zagfles said:

nigelbb said:

Silvertabby said:

nigelbb said:

jamesd said:

nigelbb said:

jamesd said:

A crude look at the financial cost. It's roughly a 25% increase in pensioners and since the state pension is paid for out of the NI from working people that implies a 25% increase in NI. NI today is largely 12% employee and 13.8% employer for a combined 25.8% so the result would be an increase in NI of around 7%.

This ignores the reduced number of workers from earlier retiring, the different NI rates and the use of some NI for the NHS and working age benefits but it gives a reasonable if crude idea of how much the proposal would hurt workers. Young workers are likely to be particularly badly affected by the reduced take home pay or employers deciding that the higher NI makes some of them not worth employing.

Sounds good to me. If earning £100K per year you would only pay about £410 extra National Insurance per year. 

7% of the portion above the higher rate threshold is around £3,500. On top of the extra 7% on most of the part below that. Unless employers are made to pay some of it.

I don't know where you get your figures from but according to https://www.thesalarycalculator.co.uk on a salary of £100K the amount of NI paid per year is £ 5,878.84. I make 7% of that £406.

But wouldn't it be an extra 7% from the salary, not just the existing NI?

I was responding to the the claim that this proposal would require an increase in NI of around 7%. In fact I see now it's not a 7% increase but 25% that is required.

I still think that for someone earning £100K per year to pay an extra £1,500 per year to be able to draw their state pension at 60 is a great deal.

It's blatently obvious that he was referring to NI rates, not take, being increased by 7%, eg employee rates going from 12%/2% to 19%/9%. That would be a £6330 increase for someone on £100k.

No. Increasing a rate by 7% is increasing it by 7% not by 60% or 350% or whatever.

I'm not even sure where the 7% comes from as in rough figures increasing the number of years a pension would be paid (given average life expectancy) from 20 years to 25 years requires a 25% increase in funding not the well over 100% you claim.

Look up how NI works. If you increase the employee rates by 7% as suggested (that's the rates, not the amounts), then the increase in amount paid for higher earners would be far more than lower earners.

QrizB

nigelbb said:

zagfles said:

It's blatently obvious that he was referring to NI rates, not take, being increased by 7%, eg employee rates going from 12%/2% to 19%/9%. That would be a £6330 increase for someone on £100k.

No. Increasing a rate by 7% is increasing it by 7% not by 60% or 350% or whatever.

I'm not even sure where the 7% comes from as in rough figures increasing the number of years a pension would be paid (given average life expectancy) from 20 years to 25 years requires a 25% increase in funding not the well over 100% you claim.

This argument is crazy, it'a all there in jamesd's post.

• Increase in pensioners by 25% (average pension paid for 20 years from 65, so 25 years from 60)
• Current rate of NI is 12% employee, 13.8% employer > 25.8% total.
• 25% of 25.8% = 6.45%, rounded up to " increase by 7%"
• So employee NI could go from 12%/2% to 18.45%/8.45%, or employee to 15%/2.5% and employer to 17.25% or any permutation that works for whatever point you're trying to make.
  

jamesd

nigelbb said:

No. Increasing a rate by 7% is increasing it by 7% not by 60% or 350% or whatever.

I'm not even sure where the 7% comes from as in rough figures increasing the number of years a pension would be paid (given average life expectancy) from 20 years to 25 years requires a 25% increase in funding not the well over 100% you claim.

I wrote an increase by 25% which is about a rate increase by 7%. Here's the original paragraph since you seem to have missed the 25% part of it:

"It's roughly a 25% increase in pensioners and since the state pension is paid for out of the NI from working people that implies a 25% increase in NI. NI today is largely 12% employee and 13.8% employer for a combined 25.8% so the result would be an increase in NI of around 7%."

As should be clear a percentage increase of 25% on a base rate of 25.8% is 6 or 7% depending on how you want to approximate. However, for additional clarity I've now edited that paragraph to say:

"A crude look at the financial cost. It's roughly a 25% increase in pensioners and since the state pension is paid for out of the NI from working people that implies a 25% increase in NI. NI today is largely 12% employee and 13.8% employer for a combined 25.8% so the result would be an increase in NI to 32.25%. In the higher rate 2% plus 13.8% it'd rise to 19.75 but I think it'd be politically intolerable to have higher earners getting a lower increase so I think it might be done by ceasing to have the NI upper earnings limit align with higher rate tax and move it higher so some higher rate income tax money gets the combined 32.25% NI."

It's not just an increase in number of years paid. As the post said it's roughly a 25% increase in the number of people getting paid the pension, from 66 to death to 60 to death. If you want to refine that crude number you can check the population in those age ranges to get a more accurate figure.

The point is that if you increase the number of pensioners by around 25% then somehow the NI take is going to need increasing by about the same proportion and that's going to be painful for the working population.