Martin's suggestion for winter fuel allowance

BarelySentientAI

Exodi said:

matt_drummer said:

A quote from another unrelated discussion

Re. the quote above, my WFP of £500 has already been spent, on a holiday to Egypt where I enjoyed scuba diving and snorkelling. I am so comfortable wearing as many clothes as needed for a given temperature, there's no way I could gain from spending the WFP or any other £500 on heating. If I heated just one room, for example, I know it's far less convenient. I'd freeze - it could even be dangerous - whenever I leave the heated room, as I found when I tried it 15 or 20 years ago.

I have nothing against the person who posted this or their lifestyle.

They are not alone, just handing out money whether it is needed or not has to be looked at when governments need to save money.

The money isn't coming from thin air, it's coming from the pockets of working families. Do pensioners just not care?

From this thread, and the many others like it, several representatives clearly do not.

No other group is so well looked after and yet so full of complaints about being targeted and persecuted, whilst simultaneously wishing targeting against others.

Qyburn

Vitruvius1 said:
... one of the worst pension provisions in the developed world. 

Any factual basis for that assertion?

The_Green_Hornet

Qyburn said:

Vitruvius1 said:
... one of the worst pension provisions in the developed world. 

Any factual basis for that assertion?

As each country has different pension systems it is extremely difficult to compare as this article explains.

How Does the UK State Pension Compare with Other Countries? | Pension Times

Scot_39

Brian3357 said:

It really isnt true that we haven't paid enough tax! We have never in history paid more tax! 

If we had paid enough tax - we wouldn't have a national debt of over £2.7 tn.

It doesn't matter if we are paying record amounts when the services we collectively share cost record amounts - and even more than we - and businesses pay.

In a nation of over 66million, less than half pay any income taxes - those beyond retirement age don't pay any NI even thosecremaing in workfore as many now do (by choice or need)- a tax that isn't ringfenced as some imagine it completely is.

And two of the biggest growth areas - health (NHS, care)  and benefits (including as officially it does state pensions) are in part driven by an increasingly elderly population.  Over 2 million more over 65s in uk between 2011 and 2021 census data sets . Only in part balanced by net migration of younger workers from abroad - in part due to low wages many earned..

And the insidious creep of stealth taxes - insurance premium tax etc - to replace more traditional sources like wage deuctions - or shift from central govt grant to council tax etc - deliberately just muddies the waters.

C50 years ago basic rate tax was 33% - it was cut to 23% under Cons (Thatcher, Major), to 20% under New Labour and Lib / Cons cut arguably more progressively by doubling the IT PA to £12570 - worth over £1200 net.
On current median c£35.5k - paying 20% tax now on c23k - £4.6k now that pa rise equiv to another 5% rate cut.  Even more at min wage, less at 40% threshold now 50k.
And in last 2 years - NI threshold rise (again progressive) and 2 2% rate cuts (again like prec2010 IT rate cuts - not progressive) this year. Again lower deductions of over £1000 -  net at benefit at median wage.  Pensioners didn't save a penny - they don't pay NI (but 6m around half would have paid the scrapped nhs levy).

So after decades of cuts to IT and NI at ave median gross wage deductions are now only 18% of gross at £35.5k median in Eng.  If take iirc ave wage of hmrc paye - sub 30k last figure saw - 16%.

The equiv figure for medians is around 30% plus in France - arguably better services (and younger state pensions - contraversial raised from 62 to 64 planned - still yearscearlier than UK) - and iirc 31-32% Germany (assuming state or employer pays share health charge) - better services and lower debt to GDP.

And again the share of the overall direct wages tax burden of those on lower incomes vs those on high income -  is much lower in UK than likes of France.

There have been times post war when govts have managed a run of surplus years but taxes sensibly stayed high to pay down war debts.
But arguably not for nearly all of this century.  Over 20 years of consecutive deficits - with no end in site - since New Labours 2nd term in 2001 - starting well before crash - despite omitting accumulted £80bn nhs pfi, and c£30bn student loan book in later years.

Despite a decade of austerity (or because as some Keynesian advocates argue) post crash under Cons - the deficit had only reduced back to pre crash levels in mid 00's by 2018/19 - before Covid et al hit.

High interest rates in last couple of years saw the interest alone on servicing accumulated debt - reach over £100bn recently - 10% of total govt spending.

Higher than almost every department except iirc health (nhs and central govt care liability - not local govt share) and benefits (if as govts do count state pensions)

As some would say - you cannot have European service levels on US taxation rates.

Given US deficits and debt - you cannot even have us level services on us tax rates.

Swipe

I suspect a thread padlock is imminent. 

Eldi_Dos

Swipe said:

I suspect a thread padlock is imminent. 

Would that be like one we put on bridges to remember good times, when we had WHA.

Black_Monk

Dear BarelySentiantAI

Many thanks for your reply. Let us unpack your post point-by-point:

"If they get away with this they might target other things" is not justification for an economic decision.

The key word here is 'may'. This government or future governments may or may not decide to means-test other benefits. If WFA is means-tested then a precedence will be set that would make further means-testing easier to implement.

Fortunately, governments do (on occasion) do what is correct and/or necessary rather than simply what is popular.

I do not consider this policy correct as it makes no sense financially. Labour wants to means-test the WFA to save £1.5Bn but started an awareness campaign to encourage take up of Pension Credit even though that will cost them £3.8Bn and those that do will still be able to claim WFA! That is probably why the PC application form has 243 questions, to make it so difficult most pensioners will be put off applying.

If 450,000 people signed the Age UK petition then several times that number (i.e. millions) have strong views on the subject. There is absolutely no way this policy can be considered popular. Labour would be most unwise to ignore the opinion of so many people.

I would be "morally outraged" if the government decided to keep just giving away cash to anyone and everyone simply for existing, rather than spending it where it is necessary and useful.  Except I wouldn't, because moral outrage is often a method of hiding an illogical but emotional judgement behind a justification that people are scared to argue with.

What I actually said was: “I would be morally outraged if the government would allow more vulnerable people to die of the cold this winter in order to save money while at the same time giving already well remunerated train drivers a double-digit pay rise.”

It is a sad fact that the UK is the second worst in Europe for cold related deaths, around 9,000 each year in England and Wales. Any right minded person would be morally outraged at this number of avoidable deaths. Means-testing WFA is not going to help.

Also, Black_Monk, it's disingenuous to suggest that it's a "planned" increase in the price cap.  It's an increase based on the actual cost of producing and supplying energy, calculated from historical information.

Well I certainly hope the increase in the energy cap is based on hard data and they just didn't pull figures from a hat! The point is energy bills are going to go up and pensioners are going to have less money to pay them. Would I have caused less offence if I had said 'scheduled' instead?

I suppose what annoys me about all this is that I don't consider my mother well-off. She is just a working-class woman who has worked hard all her life so she has built up a full NI contribution record and therefore receives the full state pension plus a small company pension. She also pays tax on her pensions so really she was funding her WFA. If she was Victoria Beckham then yes I would agree she could forgo the WFA!

It is all very well Starmer saying 'The broadest shoulders should bear the heavier burden' but perhaps those shoulders became broad by years of hard work and self sacrifice?

I think there there should be a special edition of the 'Martin Lewis Money Show' dedicated to grilling the Chancellor about this policy.

rp1974

Swipe said:

I suspect a thread padlock is imminent. 

Not as if there's a specific request not to venture into such areas,like a banner at the top of the page,some people won't take a polite request though so there's that to contend with,almost as if it's on purpose.
Appears to be the same across multiple threads,by a broadly similar cohort of posters interestingly enough.
.

wrf12345

I'd say that the chances are quite high that taxes for the rich will go up, so those that don't need WFA will be paying more tax so even though they are getting the allowance, overall they will get less money and the govn will not save very much in making it means tested, so that suggests keeping it. It will be the energy companies that suffer most as people will simply not use their heating in winter, a big difference between handing their own money and "free" money from the government to cartel type companies. In that sense the previous government handouts to all helped the energy companies out. But possibly being able to buy up fallen energy companies for next to nowt appeals to the current lot, another reason for them to get rid of standing charges.

BarelySentientAI

Black_Monk said:

"If they get away with this they might target other things" is not justification for an economic decision.

The key word here is 'may'. This government or future governments may or may not decide to means-test other benefits. If WFA is means-tested then a precedence will be set that would make further means-testing easier to implement.

There is already a well established precedent for means testing.   Means testing WFA would not change this.

Black_Monk said:

Fortunately, governments do (on occasion) do what is correct and/or necessary rather than simply what is popular.

I do not consider this policy correct as it makes no sense financially. Labour wants to means-test the WFA to save £1.5Bn but started an awareness campaign to encourage take up of Pension Credit even though that will cost them £3.8Bn and those that do will still be able to claim WFA! That is probably why the PC application form has 243 questions, to make it so difficult most pensioners will be put off applying.

You don't consider attempting to make sure benefits are paid to those eligible for them and not as a blanket handout to those not in need is correct?  An interesting standpoint, but I disagree. 

Black_Monk said:

If 450,000 people signed the Age UK petition then several times that number (i.e. millions) have strong views on the subject. There is absolutely no way this policy can be considered popular. Labour would be most unwise to ignore the opinion of so many people. 

Tens of thousands of people will sign almost any sort of petition.  Whether or not they actually have strong views.  Examples include ending women's suffrage and banning dihydrogen monoxide.

We agree that this appears to be an unpopular policy.  You derive from that that the policy is wrong.  I do not.

Black_Monk said:.

I would be "morally outraged" if the government decided to keep just giving away cash to anyone and everyone simply for existing, rather than spending it where it is necessary and useful.  Except I wouldn't, because moral outrage is often a method of hiding an illogical but emotional judgement behind a justification that people are scared to argue with.

What I actually said was: “I would be morally outraged if the government would allow more vulnerable people to die of the cold this winter in order to save money while at the same time giving already well remunerated train drivers a double-digit pay rise.”

It is a sad fact that the UK is the second worst in Europe for cold related deaths, around 9,000 each year in England and Wales. Any right minded person would be morally outraged at this number of avoidable deaths. Means-testing WFA is not going to help.

And blanket handouts of cash do not help either.  Address the needs of the vulnerable appropriately.  Energy prices are substantially lower than they were two winters ago - by much more than the value of the WFA - which just goes to show that the free money for all idea hasn't fixed anything.

Phrasing this as pensioners Vs train drivers is unnecessary and unhelpful.  Is that how all policy decisions should now be approached?  Group A got an improvement in circumstances, therefore any change that has a detrimental effect on anyone must be banned?

Black_Monk said:

Also, Black_Monk, it's disingenuous to suggest that it's a "planned" increase in the price cap.  It's an increase based on the actual cost of producing and supplying energy, calculated from historical information.

Well I certainly hope the increase in the energy cap is based on hard data and they just didn't pull figures from a hat! The point is energy bills are going to go up and pensioners are going to have less money to pay them. Would I have caused less offence if I had said 'scheduled' instead?

Expected?  Predicted?  Energy bills will probably go up, as do other bills, for all people.  Are you also suggesting that there should be free grocery vouchers for all pensioners?  Free petrol allowances for those who need to drive to work?  Why this particular expenditure and this particular group?

Black_Monk said:

I suppose what annoys me about all this is that I don't consider my mother well-off. She is just a working-class woman who has worked hard all her life so she has built up a full NI contribution record and therefore receives the full state pension plus a small company pension. She also pays tax on her pensions so really she was funding her WFA. If she was Victoria Beckham then yes I would agree she could forgo the WFA!

It is all very well Starmer saying 'The broadest shoulders should bear the heavier burden' but perhaps those shoulders became broad by years of hard work and self sacrifice?

I think there there should be a special edition of the 'Martin Lewis Money Show' dedicated to grilling the Chancellor about this policy.

And there we get the explanation.  I, or someone I care about, will be slightly worse off.  This means that it is a bad thing, and someone else who is not connected to me should have bad things instead so I can keep mine.

Vulnerable people should get the support they need through the most appropriate channel.  Is someone with a full state pension and a company pension vulnerable?  That's not for me to decide.

Free cash for all is not the most appropriate channel.

And your point about not having a problem if "rich" people were to forgo the payment contradicts the rest of your argument.