Another "hint" from Pensions Minister that State Pension Age eligibility will change

OldScientist

zagfles said:

Universidad said:

p00hsticks said:

There are a number of statistics on various living standards in Britiain here

Perhaps you would be prepared to indicate exactly which ones you beleive support your assertion, or alternative suggest another authoratitive source ? 

"Living Standards in Britain, 1870-2010"

You know I could be 45 years old, and been in higher education until I was 28, and been in the workforce for 17 years, and still only 3 to 4 years of my career would show on that data, any variance in which would look like a statistical blip, which we'd probably attribute to the financial crisis in 2007/8.

Don't you worry, ten years from now the data will show the experience I've been living. Your charts start right at the top of the rollercoaster.

I wouldn't consider 17 years to be a short period when compared to a life, but let me tell you, since the run on Northern Rock every part of my working life has been getting worse not just in the present but foreseeably for the future. It's not just that it's bad right now, it's that the things I have to look forward to are diminishing. And every major step forward I take is annhilated by circumstance. I got a huge promotion in 2016, but salaries fell behind inflation so my spending power went down, even though I was stressed as !!!!!! and working longer. 

There's no light at the end of this tunnel for my generation expect a retirement that's continually being diminishes and having the goalposts moved.

There were a wave of pension changes in 2011 that killed the final salary scheme I expected to get. Another  wave in 2016 that gutted the scheme that had replaced it. And in my case another wave in since that which have rendered it unaffordable to retire on. So I've moved somewhere else, and all I hear is how unaffordable the pension I'm now on will be in the future, and what will have to be done to gut it.

And then the retirement age keeps going up. And salaries don't match inflation. I got a taste, just a taste, of what it felt like to be middle class in a first world country, and ever since then we've been sliding backwards.

And I supposed to what, be happy about smartphones or something?

Here's some stats to fill most of that 12 year gap:

https://www.ons.gov.uk/employmentandlabourmarket/peopleinwork/earningsandworkinghours/bulletins/annualsurveyofhoursandearnings/2021

Fig 1 is interesting, shows about a 20% real terms increase in wages between 2011 and 2021.

What pension scheme are you in? By 2011 most DB schemes had closed, except for public sector ones. The current public sector CARE ones are still excellent (far better than the FS ones of the 80's and 90's for most people).

I think the note under Figure 1 in the 2021 version suggesting that the values have been adjusted for inflation is misleading. Figure 1 and 2 in the 2022 version (https://www.ons.gov.uk/employmentandlabourmarket/peopleinwork/earningsandworkinghours/bulletins/annualsurveyofhoursandearnings/2022) indicate that the values in Figure 1 (2021) are nominal and not real (e.g. using the 2022 version, full time wages from 2015 to 2016 went from 527 to 539, an increase of 2.3%, which is within 0.1 percentage point of the nominal increase given in Figure 2 and greater than the real increase of 1.5% given in that graph). I also note that there is no mention of inflation in the raw data.

The upshot is that from April 2011 to April 2021, the nominal median wage increased by 22% and real median wage increased by about 3%. Extend that a year either side (i.e. April 2010 year to April 2022), and the real median wage from dropped by 3% while nominal wages increased by 29%.

 

zagfles

Universidad said:

zagfles said:

On stuff like mental health etc I doubt there's been much of a change in sufferers just recognition and support, plus stuff like tolerance, discrimination, bigotry etc. I had a friend at school who, looking back, was undoubtedly autistic, but they didn't recognise it or make any adjustments or give him any support. Another friend who was slightly effeminate, he wasn't gay but everyone assumed he was, he got loads of homophobic abuse and was bullied relentlessly, including physical and sexual violence, something which wouldn't be tolerated today.

It's a strong flex to use improvements in social justice as an example of how life is better for millennials, as if this was something received rather than something given.

I don't know what the argument about mental health is - is it that life has always been miserable, for most people, but that we're the first generation to try to find a way to address that?Or do you think mental health issues are comparatively low, but more visible?

I don't think life is miserable for most people, certainly not in the western world, but clearly it is for some. But a lot of people are miserable not because of mental health issues or bigotry etc but because they have chip on their shoulder because they perceive other groups in society as being more privileged or having an unfair advantage over them. Where in fact that advantage, which may exist in some contexts, is trivial compared to the advantage they themselves have over most of the world's population geographically and historically.

zagfles

OldScientist said:

zagfles said:

Universidad said:

p00hsticks said:

There are a number of statistics on various living standards in Britiain here

Perhaps you would be prepared to indicate exactly which ones you beleive support your assertion, or alternative suggest another authoratitive source ? 

"Living Standards in Britain, 1870-2010"

You know I could be 45 years old, and been in higher education until I was 28, and been in the workforce for 17 years, and still only 3 to 4 years of my career would show on that data, any variance in which would look like a statistical blip, which we'd probably attribute to the financial crisis in 2007/8.

Don't you worry, ten years from now the data will show the experience I've been living. Your charts start right at the top of the rollercoaster.

I wouldn't consider 17 years to be a short period when compared to a life, but let me tell you, since the run on Northern Rock every part of my working life has been getting worse not just in the present but foreseeably for the future. It's not just that it's bad right now, it's that the things I have to look forward to are diminishing. And every major step forward I take is annhilated by circumstance. I got a huge promotion in 2016, but salaries fell behind inflation so my spending power went down, even though I was stressed as !!!!!! and working longer. 

There's no light at the end of this tunnel for my generation expect a retirement that's continually being diminishes and having the goalposts moved.

There were a wave of pension changes in 2011 that killed the final salary scheme I expected to get. Another  wave in 2016 that gutted the scheme that had replaced it. And in my case another wave in since that which have rendered it unaffordable to retire on. So I've moved somewhere else, and all I hear is how unaffordable the pension I'm now on will be in the future, and what will have to be done to gut it.

And then the retirement age keeps going up. And salaries don't match inflation. I got a taste, just a taste, of what it felt like to be middle class in a first world country, and ever since then we've been sliding backwards.

And I supposed to what, be happy about smartphones or something?

Here's some stats to fill most of that 12 year gap:

https://www.ons.gov.uk/employmentandlabourmarket/peopleinwork/earningsandworkinghours/bulletins/annualsurveyofhoursandearnings/2021

Fig 1 is interesting, shows about a 20% real terms increase in wages between 2011 and 2021.

What pension scheme are you in? By 2011 most DB schemes had closed, except for public sector ones. The current public sector CARE ones are still excellent (far better than the FS ones of the 80's and 90's for most people).

I think the note under Figure 1 in the 2021 version suggesting that the values have been adjusted for inflation is misleading. Figure 1 and 2 in the 2022 version (https://www.ons.gov.uk/employmentandlabourmarket/peopleinwork/earningsandworkinghours/bulletins/annualsurveyofhoursandearnings/2022) indicate that the values in Figure 1 (2021) are nominal and not real (e.g. using the 2022 version, full time wages from 2015 to 2016 went from 527 to 539, an increase of 2.3%, which is within 0.1 percentage point of the nominal increase given in Figure 2 and greater than the real increase of 1.5% given in that graph). I also note that there is no mention of inflation in the raw data.

The upshot is that from April 2011 to April 2021, the nominal median wage increased by 22% and real median wage increased by about 3%. Extend that a year either side (i.e. April 2010 year to April 2022), and the real median wage from dropped by 3% while nominal wages increased by 29%.

 

I did think the rise looked a bit much for real terms - but I didn't expect the ONS to be wrong!!

But even so - the above shows real wages pretty flat, 3% over 12 years either way is pretty trivial...so we're not really much better or worse off, which considering the GFC, COVID, Ukraine etc, maybe isn't a bad place to be. We're certainly not significantly worse off, on average.

Universidad

zagfles said:

a lot of people are miserable not because of mental health issues or bigotry etc but because they have chip on their shoulder because they perceive other groups in society as being more privileged or having an unfair advantage over them.

I'm aware of how dramatic the pensions cuts I've seen in my working life are, and I'm here to do what I can to salvage the situation.The point is, I'm literally the living embodiment of making the most of where I am.

I didn't come here to grumble, I came here to fix my retirement.

The reason you're seeing the sharp side of that, is because I am absolutely sick to my back teeth of being told how good I have it by the generation I am subsidising.

zagfles

Universidad said:

zagfles said:

a lot of people are miserable not because of mental health issues or bigotry etc but because they have chip on their shoulder because they perceive other groups in society as being more privileged or having an unfair advantage over them.

I'm aware of how dramatic the pensions cuts I've seen in my working life are, and I'm here to do what I can to salvage the situation.The point is, I'm literally the living embodiment of making the most of where I am.

I didn't come here to grumble, I came here to fix my retirement.

The reason you're seeing the sharp side of that, is because I am absolutely sick to my back teeth of being told how good I have it by the generation I am subsidising.

So, specifically, what pension are you currently accruing? DC - what employer contribution rate? DB - CARE/FS and what accrual rate?

There's a lot of rose tinted spectacles when discussing pensions of the past. There was a lot wrong with typical final salary pensions of a few decades ago, such as lack of inflation protection, lack of protection against employer going bust etc. Lots of people ended up losing their pension completely because their employer went bust, or having it decimated because they left their job with 2 decades to retirement and there were no inflation increases. Companies used to use pensions as "golden handcuffs" to stop employees leaving.

Successive govts introduced new rules to try to fix those problems such as mandating inflation protection, the PPF etc. This of course increased costs and that plus other factors such as lower investment returns, increasing longevity etc made DB pensions much more expensive so they're virtually non existant in the private sector these days.

Anyone lucky enough to have any sort of DB pension these days is better off than those accruing a DB pension a few decades ago, certainly a private sector one anyway.

The big divide in pension accrual these days isn't so much by generation, it's private vs public sector.

jimi_man

prowla said:

It's starting to feel like the pot of gold at the end of the rainbow.

But is it? At the end of the day it’s just £9500 less out of the retirement pot. Granted for some people that might be a tumultuous loss but for most people it’s just a blip. With 10 years notice it’s an extra £950 a year to make up for it. 

Universidad

jimi_man said:

But is it? At the end of the day it’s just £9500 less out of the retirement pot. Granted for some people that might be a tumultuous loss but for most people it’s just a blip. With 10 years notice it’s an extra £950 a year to make up for it. 

Most DB schemes have tied their NPA to state pension age, now. So it's actually potentially a lot, lot worse.

zagfles said:

So, specifically, what pension are you currently accruing? DC - what employer contribution rate? DB - CARE/FS and what accrual rate?

Before I came here to take good advice from knowledgeable people, I was in USS.

Accrual rate 1/85.

Inflation matching capped at 2.5%.

Salary cap at 40,000K, beyond which only DC pot available.

And a significant portion of the employer contribution doesn't go into your pot, it just goes into bouying up the scheme.

This does not compare, at all, to either the scheme I signed up for in the 2000s, or to the schemes my parents have been drawing from for years now.

Oh, and when they closed the final salary portion of the scheme, they decided that your salary at the time was your final salary, not the one you'd eventually finish up on, once again throwing a tasty dose of generational unfairness into the mix.

OldScientist

zagfles said:

OldScientist said:

zagfles said:

Universidad said:

p00hsticks said:

There are a number of statistics on various living standards in Britiain here

Perhaps you would be prepared to indicate exactly which ones you beleive support your assertion, or alternative suggest another authoratitive source ? 

"Living Standards in Britain, 1870-2010"

You know I could be 45 years old, and been in higher education until I was 28, and been in the workforce for 17 years, and still only 3 to 4 years of my career would show on that data, any variance in which would look like a statistical blip, which we'd probably attribute to the financial crisis in 2007/8.

Don't you worry, ten years from now the data will show the experience I've been living. Your charts start right at the top of the rollercoaster.

I wouldn't consider 17 years to be a short period when compared to a life, but let me tell you, since the run on Northern Rock every part of my working life has been getting worse not just in the present but foreseeably for the future. It's not just that it's bad right now, it's that the things I have to look forward to are diminishing. And every major step forward I take is annhilated by circumstance. I got a huge promotion in 2016, but salaries fell behind inflation so my spending power went down, even though I was stressed as !!!!!! and working longer. 

There's no light at the end of this tunnel for my generation expect a retirement that's continually being diminishes and having the goalposts moved.

There were a wave of pension changes in 2011 that killed the final salary scheme I expected to get. Another  wave in 2016 that gutted the scheme that had replaced it. And in my case another wave in since that which have rendered it unaffordable to retire on. So I've moved somewhere else, and all I hear is how unaffordable the pension I'm now on will be in the future, and what will have to be done to gut it.

And then the retirement age keeps going up. And salaries don't match inflation. I got a taste, just a taste, of what it felt like to be middle class in a first world country, and ever since then we've been sliding backwards.

And I supposed to what, be happy about smartphones or something?

Here's some stats to fill most of that 12 year gap:

https://www.ons.gov.uk/employmentandlabourmarket/peopleinwork/earningsandworkinghours/bulletins/annualsurveyofhoursandearnings/2021

Fig 1 is interesting, shows about a 20% real terms increase in wages between 2011 and 2021.

What pension scheme are you in? By 2011 most DB schemes had closed, except for public sector ones. The current public sector CARE ones are still excellent (far better than the FS ones of the 80's and 90's for most people).

I think the note under Figure 1 in the 2021 version suggesting that the values have been adjusted for inflation is misleading. Figure 1 and 2 in the 2022 version (https://www.ons.gov.uk/employmentandlabourmarket/peopleinwork/earningsandworkinghours/bulletins/annualsurveyofhoursandearnings/2022) indicate that the values in Figure 1 (2021) are nominal and not real (e.g. using the 2022 version, full time wages from 2015 to 2016 went from 527 to 539, an increase of 2.3%, which is within 0.1 percentage point of the nominal increase given in Figure 2 and greater than the real increase of 1.5% given in that graph). I also note that there is no mention of inflation in the raw data.

The upshot is that from April 2011 to April 2021, the nominal median wage increased by 22% and real median wage increased by about 3%. Extend that a year either side (i.e. April 2010 year to April 2022), and the real median wage from dropped by 3% while nominal wages increased by 29%.

 

I did think the rise looked a bit much for real terms - but I didn't expect the ONS to be wrong!!

But even so - the above shows real wages pretty flat, 3% over 12 years either way is pretty trivial...so we're not really much better or worse off, which considering the GFC, COVID, Ukraine etc, maybe isn't a bad place to be. We're certainly not significantly worse off, on average.

I think who ever wrote the report cut and pasted that note from the other graphs - unusual to find an error at the ONS though. 

I'd agree median gross wages look about the same in real terms across the last decade or so. I note that the minimum wage has increased by just over 50% in nominal terms since 2010 (see https://www.statista.com/statistics/280483/national-minimum-wage-in-the-uk/) so about 18% in real terms (although that was a smaller increase than in the previous decade). I suspect (from a very brief and not rigorous look at some of the underlying data), that increases have not happened that evenly across the income scale. It would also be interesting to see how wages after tax have behaved.

zagfles

Universidad said:

jimi_man said:

But is it? At the end of the day it’s just £9500 less out of the retirement pot. Granted for some people that might be a tumultuous loss but for most people it’s just a blip. With 10 years notice it’s an extra £950 a year to make up for it. 

Most DB schemes have tied their NPA to state pension age, now. So it's actually potentially a lot, lot worse.

zagfles said:

So, specifically, what pension are you currently accruing? DC - what employer contribution rate? DB - CARE/FS and what accrual rate?

Before I came here to take good advice from knowledgeable people, I was in USS.

Accrual rate 1/85.

Inflation matching capped at 2.5%.

Salary cap at 40,000K, beyond which only DC pot available.

And a significant portion of the employer contribution doesn't go into your pot, it just goes into bouying up the scheme.

Still a good pension, far better than typical private sector pensions.

This does not compare, at all, to either the scheme I signed up for in the 2000s, or to the schemes my parents have been drawing from for years now.

Oh, and when they closed the final salary portion of the scheme, they decided that your salary at the time was your final salary, not the one you'd eventually finish up on, once again throwing a tasty dose of generational unfairness into the mix.

Your parents were lucky. If they'd moved jobs frequently, or worked for an employer like Maxwell or many of the others who went bust or used the pension fund for petty cash, they might (as many pensioners today) have to live on just the state pension and nothing else. Any sort of DB pension these days is safer (if not better) than typical DB pensions of the past. Even with good employers, DB pensions only really worked well for those who stayed in the same job all their lives, they weren't so good for those who moved around a lot.

Plus of course many people were in jobs which didn't even have a pension, typical middle class intergeneration envy seems to forget about them.

Universidad

zagfles said:

Still a good pension, far better than typical private sector pensions.

Highly debateable if it is still a good pension. You get the advantage of employer contributions and salary sacrifice, which makes it valuable. 

But at the 40000 salary cap ~12000 per year is being contributed.

With that mony up front, I think most people would be able to do better.

Yes, there's less risk with a DB scheme, than a DC pot... but with a DB scheme that basically doesn't try to match inflation there's still... quite a lot of risk.

You can't have it both ways telling me that modern pensions are so much better than older pensions which didn't match inflation and then ignore that this scheme doesn't match inflation.

zagfles said:

Your parents were lucky. If they'd moved jobs frequently, or worked for an employer like Maxwell....

My parents were lucky, to be part of the generation that got those pensions. They're not lucky to be recieving them - that's what they are owed.

My grandparents who lost everything in their Maxwell pension and worked until they died in their late 80s weren't "unlucky".

They were victims of a crime.