Jeremy Hunt in plea to early retirees: ‘Britain needs you’

OldScientist

OldScientist said:

daveyjp said:

Spinybif said:

Time to phase out all unearned benefits.  Hard workers are fed up paying taxes to see the lazy & stupid  claim benefits without giving anything back.  Simple solution, you have to work for the community on the National Minimum Wage to earn your benefits. Even the disabled could read to children who are behind at school, fully able  could litter pick or  remove graphiti.  I'll bet 90%of those "unable" to get work would suddenly do so. If you have made sacrifices to earn your early retirement and don't need to rely on the state good luck to you. Why breach the LTA only to be penalised by 55% tax whilst working for the privilege 

Who manages all these extra 'public sector' employees?

So, as a whole, quite a lot of us are on 'unearned benefits' (including, for most people, their state pension since you would have needed to have set £250k aside (out of NI?) to have enough to buy an annuity with an inflation adjusted income of £10k).

On a personal note, during my working life I contributed about £80k in NI. Assuming the state pension was funded from contributions, I would have needed to have invested that at about 8% nominal in order to have a pot sufficient to purchase £10k per year. In other words, once I collect my state pension I will have just about paid for it (of course, NI isn't really set aside for pensions).

Addressing the OP, I'm currently very happy to be retired so the only way I would go back to work is if I was forced to financially. Since we are largely reliant on a DB pension to take us to state retirement age, that would have to involve some very heavy 'sticks' (e.g., retrospectively disallowing the taking of a DB pension before 67 or imposing an 'early retirement tax' of 40% - not that I want to give Mr Hunt any ideas!).

zagfles

OldScientist said:

daveyjp said:

Spinybif said:

Time to phase out all unearned benefits.  Hard workers are fed up paying taxes to see the lazy & stupid  claim benefits without giving anything back.  Simple solution, you have to work for the community on the National Minimum Wage to earn your benefits. Even the disabled could read to children who are behind at school, fully able  could litter pick or  remove graphiti.  I'll bet 90%of those "unable" to get work would suddenly do so. If you have made sacrifices to earn your early retirement and don't need to rely on the state good luck to you. Why breach the LTA only to be penalised by 55% tax whilst working for the privilege 

Who manages all these extra 'public sector' employees?

According to the ONS ( https://www.ons.gov.uk/peoplepopulationandcommunity/personalandhouseholdfinances/incomeandwealth/bulletins/theeffectsoftaxesandbenefitsonhouseholdincome/financialyearending2021 ), in 2022 just over half of UK individuals receive more in benefits than they pay in taxes. So, as a whole, quite a lot of us are on 'unearned benefits' (including, for most people, their state pension since you would have needed to have set £250k aside (out of NI?) to have enough to buy an annuity with an inflation adjusted income of £10k).

In 2016 (couldn't find any more recent figures, see https://www.ons.gov.uk/economy/governmentpublicsectorandtaxes/publicsectorfinance/articles/howisthewelfarebudgetspent/2016-03-16 ), of the benefit budget, 42% went on pensions, 16% on incapacity and disability, 1% on unemployment benefits, 10% on housing, 18% on family, income support, and tax credits.

In other words, the plan targets, at best, about 17% (well, 27% if you include housing) of the welfare budget.

Why would you not include family income support and tax credits - they're mostly means tested (or sometimes income tested) at a fairly low level. Apart for child ben which is income tested at a high level. Housing definitely need including. Not that they'd be totally eliminated, but partially in a lot of cases.

But the underlying point is the treatment of particularly people with disabilities, as charity cases who should be shoved onto the scrapheap of life long benefits dependancy, rather as people differently abled who can contribute to society in some way.

It's really an attitude change that's needed. Rather than "oh you're disabled, poor you, my compassion oozes from every pore, here have all this money and get out of my sight", it's "oh you're disabled, well what can you do and what can't you do, we'll find you something you can do and are happy to do". Obviously there'll be some who can't contribute in any way, but the majority almost certainly could.

zagfles

OldScientist said:

OldScientist said:

daveyjp said:

Spinybif said:

Time to phase out all unearned benefits.  Hard workers are fed up paying taxes to see the lazy & stupid  claim benefits without giving anything back.  Simple solution, you have to work for the community on the National Minimum Wage to earn your benefits. Even the disabled could read to children who are behind at school, fully able  could litter pick or  remove graphiti.  I'll bet 90%of those "unable" to get work would suddenly do so. If you have made sacrifices to earn your early retirement and don't need to rely on the state good luck to you. Why breach the LTA only to be penalised by 55% tax whilst working for the privilege 

Who manages all these extra 'public sector' employees?

So, as a whole, quite a lot of us are on 'unearned benefits' (including, for most people, their state pension since you would have needed to have set £250k aside (out of NI?) to have enough to buy an annuity with an inflation adjusted income of £10k).

On a personal note, during my working life I contributed about £80k in NI. Assuming the state pension was funded from contributions, I would have needed to have invested that at about 8% nominal in order to have a pot sufficient to purchase £10k per year.

Does that inlude employer contributions?

 (of course, NI isn't really set aside for pensions).

Your personal ones aren't of course but state pensions are paid out of the NI fund

https://www.gov.uk/government/publications/national-insurance-fund-accounts/great-britain-national-insurance-fund-account-for-the-year-ended-31-march-2022#receipts-and-payments-account

Grumpy_chap

OldScientist said:

On a personal note, during my working life I contributed about £80k in NI. Assuming the state pension was funded from contributions, I would have needed to have invested that at about 8% nominal in order to have a pot sufficient to purchase £10k per year. In other words, once I collect my state pension I will have just about paid for it (of course, NI isn't really set aside for pensions).

AIUI, NI also funds (allegedly) the NHS and benefits.  On that basis, how much of the £80k contribution is available to be invested to generate the £10k per year retirement fund?

bluenose1

I am currently working but won’t be working a day longer than I intend to because of Jeremy Hunt saying I should.
The press have done great divisive tactics of getting us focused on benefit fraud etc, not surprising really when most of our Papers are owned by multi millionaires living abroad. Yet tax avoidance and evasion costs UK far more than benefit fraud etc. 

Zahawi and presumably his financial advisors thought  he could get away with it in his high profile ministerial role and  Rishi Sunak’s wife is said to have avoided £20 million in tax by claiming to be non-dom. Read somewhere that Zahawi’s tax affairs have been questioned for years by some reporters with threats of libel etc to try to close any investigation. By the sounds of it this often succeeds so how many others are/ have done it.
So if those in the public eye think they can get away with it, what are those below the radar, the big corporations etc doing to avoid/ evade tax? 

Unfortunately and not surprisingly there is no political will to tackle this.

michaels

zagfles said:

OldScientist said:

OldScientist said:

daveyjp said:

Spinybif said:

Time to phase out all unearned benefits.  Hard workers are fed up paying taxes to see the lazy & stupid  claim benefits without giving anything back.  Simple solution, you have to work for the community on the National Minimum Wage to earn your benefits. Even the disabled could read to children who are behind at school, fully able  could litter pick or  remove graphiti.  I'll bet 90%of those "unable" to get work would suddenly do so. If you have made sacrifices to earn your early retirement and don't need to rely on the state good luck to you. Why breach the LTA only to be penalised by 55% tax whilst working for the privilege 

Who manages all these extra 'public sector' employees?

So, as a whole, quite a lot of us are on 'unearned benefits' (including, for most people, their state pension since you would have needed to have set £250k aside (out of NI?) to have enough to buy an annuity with an inflation adjusted income of £10k).

On a personal note, during my working life I contributed about £80k in NI. Assuming the state pension was funded from contributions, I would have needed to have invested that at about 8% nominal in order to have a pot sufficient to purchase £10k per year.

Does that inlude employer contributions?

 (of course, NI isn't really set aside for pensions).

Your personal ones aren't of course but state pensions are paid out of the NI fund

https://www.gov.uk/government/publications/national-insurance-fund-accounts/great-britain-national-insurance-fund-account-for-the-year-ended-31-march-2022#receipts-and-payments-account

But this is on a pay as you go basis so current contributions need to pay for current pensions - unless we are in steady state then the 'liabilities being accrued' may be greater than the level of contributions.

Against this is that everyone pays NI including those who don't even reach state retirement age so their is poling of longevity risk and in theory the govt does not need to hedge inflation so for them to provide an annuity (in the form of the state pension) would be cheaper than the purchase cost.

Final point on this whole 'comparing what you pay in to what you pay out' - people's productivity varies greatly (back to those footballers who's output is 'worth' a fortune).  Depending on the  distribution of productivity either the govt needs to do some redistribution or we have very uneven distribution of income - like we see in the third world where the haves need window bars, gated communities and private security guards.

Teapot55

Late entrant to a profession. Financially able to quit after twenty years. Intolerable working conditions. Ten happy years in admin. Low-paid but job satisfaction. Redundancy at 60. No way I was going near a job centre. 

stuart746

Less than 10% of retirees ever return to paid employment... anecdotally looking at the comments on this forum can give some indication as to why that is.

Also, the numbers of early retirees (over 55) have not increased as much as the long-term sick. This is not just a UK issue but one witnessed across Europe and the US.

Gov employment measures to support the long term sick back to work might be a better plan.

OldScientist

zagfles said:

OldScientist said:

daveyjp said:

Spinybif said:

Time to phase out all unearned benefits.  Hard workers are fed up paying taxes to see the lazy & stupid  claim benefits without giving anything back.  Simple solution, you have to work for the community on the National Minimum Wage to earn your benefits. Even the disabled could read to children who are behind at school, fully able  could litter pick or  remove graphiti.  I'll bet 90%of those "unable" to get work would suddenly do so. If you have made sacrifices to earn your early retirement and don't need to rely on the state good luck to you. Why breach the LTA only to be penalised by 55% tax whilst working for the privilege 

Who manages all these extra 'public sector' employees?

According to the ONS ( https://www.ons.gov.uk/peoplepopulationandcommunity/personalandhouseholdfinances/incomeandwealth/bulletins/theeffectsoftaxesandbenefitsonhouseholdincome/financialyearending2021 ), in 2022 just over half of UK individuals receive more in benefits than they pay in taxes. So, as a whole, quite a lot of us are on 'unearned benefits' (including, for most people, their state pension since you would have needed to have set £250k aside (out of NI?) to have enough to buy an annuity with an inflation adjusted income of £10k).

In 2016 (couldn't find any more recent figures, see https://www.ons.gov.uk/economy/governmentpublicsectorandtaxes/publicsectorfinance/articles/howisthewelfarebudgetspent/2016-03-16 ), of the benefit budget, 42% went on pensions, 16% on incapacity and disability, 1% on unemployment benefits, 10% on housing, 18% on family, income support, and tax credits.

In other words, the plan targets, at best, about 17% (well, 27% if you include housing) of the welfare budget.

Why would you not include family income support and tax credits - they're mostly means tested (or sometimes income tested) at a fairly low level. Apart for child ben which is income tested at a high level. Housing definitely need including. Not that they'd be totally eliminated, but partially in a lot of cases.

But the underlying point is the treatment of particularly people with disabilities, as charity cases who should be shoved onto the scrapheap of life long benefits dependancy, rather as people differently abled who can contribute to society in some way.

It's really an attitude change that's needed. Rather than "oh you're disabled, poor you, my compassion oozes from every pore, here have all this money and get out of my sight", it's "oh you're disabled, well what can you do and what can't you do, we'll find you something you can do and are happy to do". Obviously there'll be some who can't contribute in any way, but the majority almost certainly could.

Tax credits are for those in work (surely those already in work don''t need to be forced in to additional work in order to obtain their benefits)?

For those with disabilities (which covers an enormous range of conditions from long term illness, physical, and mental), there is a big difference between ensuring that they have fair access to the jobs market (i.e. they are not discriminated against) and being allocated work or having benefits withheld.

OldScientist

Grumpy_chap said:

OldScientist said:

On a personal note, during my working life I contributed about £80k in NI. Assuming the state pension was funded from contributions, I would have needed to have invested that at about 8% nominal in order to have a pot sufficient to purchase £10k per year. In other words, once I collect my state pension I will have just about paid for it (of course, NI isn't really set aside for pensions).

AIUI, NI also funds (allegedly) the NHS and benefits.  On that basis, how much of the £80k contribution is available to be invested to generate the £10k per year retirement fund?

Quite... so, I had a salary that, in the latter part of my career was in the top 10% in the UK and, accounted for properly, I won't have paid for my state pension. Very few people actually have...