The inevitable pre-budget speculation on pensions

Linton

BlackKnightMonty said:

Albermarle said:

BlackKnightMonty said:

Eldi_Dos said:

BlackKnightMonty said:

Eldi_Dos said:

BlackKnightMonty said:

RogerPensionGuy said:

Cobbler_tone said:

Today I have read about a 2p increase on IC and 2p reduction on NI. Reducing or scrapping NI relief on salary sacrifice. Reducing the TFLS to £100k. Extending the freeze on tax bands.
They may not do any of them but at the same time could do all of them. If they did I think some posters on here would go into meltdown. Being close to retirement could mean a case of damage limitation but I’m sure they’ll be an impact somewhere but hopefully not enough to change my plans.

With the current blackhole, economic outlook/GDP/age demographics etc and having in place a sensible headroom for the following few budgets, pulling a fair few levers looks very likely to me.

Only one item comes to mind that they won't pull on, state pension tripple lock. 

We will see on the 26th.

Shame, it’s breaking the economy, and quite frankly society.

Suppose if you repeat a mantra often enough some people will start to believe it.

Talk to anyone under 40 about what they think of the triple lock…

I do talk to people under forty on a regular basis and none I have came across are particularly fixated or against the triple lock, they all seem more interested in issues that are more relevant to them, like student debt, career progression or if they are in rental accommodation securiity of tenure.

For what its worth the only thing I can see wrong with the triple lock is that a sunset clause was not included to kick in when a threshold was met, but cannot imagine that would be to difficult to change.

Perhaps they are being polite?

Perhaps you should ask them direct questions about the triple lock? (Is it fair, should it be kept)

I suspect if you did that, then the most common reaction would be a blank look.

I think you will find their awareness of the intergenerational injustice is wider than you give credit.

In 20 years time they will understand how reasonable it all is.  Of course that assumes that they have the sense to put appropriate amounts into their pensions.

Actually the triple lock does not make a very great difference.  Since it was introduced in 2011 by 2026 SP will have increased by 89%.  If we just had a double lock the rise would have been 83%.

Albermarle

BlackKnightMonty said:

Albermarle said:

BlackKnightMonty said:

Eldi_Dos said:

BlackKnightMonty said:

Eldi_Dos said:

BlackKnightMonty said:

RogerPensionGuy said:

Cobbler_tone said:

Today I have read about a 2p increase on IC and 2p reduction on NI. Reducing or scrapping NI relief on salary sacrifice. Reducing the TFLS to £100k. Extending the freeze on tax bands.
They may not do any of them but at the same time could do all of them. If they did I think some posters on here would go into meltdown. Being close to retirement could mean a case of damage limitation but I’m sure they’ll be an impact somewhere but hopefully not enough to change my plans.

With the current blackhole, economic outlook/GDP/age demographics etc and having in place a sensible headroom for the following few budgets, pulling a fair few levers looks very likely to me.

Only one item comes to mind that they won't pull on, state pension tripple lock. 

We will see on the 26th.

Shame, it’s breaking the economy, and quite frankly society.

Suppose if you repeat a mantra often enough some people will start to believe it.

Talk to anyone under 40 about what they think of the triple lock…

I do talk to people under forty on a regular basis and none I have came across are particularly fixated or against the triple lock, they all seem more interested in issues that are more relevant to them, like student debt, career progression or if they are in rental accommodation securiity of tenure.

For what its worth the only thing I can see wrong with the triple lock is that a sunset clause was not included to kick in when a threshold was met, but cannot imagine that would be to difficult to change.

Perhaps they are being polite?

Perhaps you should ask them direct questions about the triple lock? (Is it fair, should it be kept)

I suspect if you did that, then the most common reaction would be a blank look.

I think you will find their awareness of the intergenerational injustice is wider than you give credit.

I was not really thinking about younger people in particular, more that the general awareness of personal finance matters amongst the public is pretty poor.
I would imagine a significant % of pensioners would struggle to explain the details of the Triple Lock if you asked them  and a smaller but significant % will only be dimly aware of it, if at all.

BlackKnightMonty

Linton said:

BlackKnightMonty said:

Albermarle said:

BlackKnightMonty said:

Eldi_Dos said:

BlackKnightMonty said:

Eldi_Dos said:

BlackKnightMonty said:

RogerPensionGuy said:

Cobbler_tone said:

Today I have read about a 2p increase on IC and 2p reduction on NI. Reducing or scrapping NI relief on salary sacrifice. Reducing the TFLS to £100k. Extending the freeze on tax bands.
They may not do any of them but at the same time could do all of them. If they did I think some posters on here would go into meltdown. Being close to retirement could mean a case of damage limitation but I’m sure they’ll be an impact somewhere but hopefully not enough to change my plans.

With the current blackhole, economic outlook/GDP/age demographics etc and having in place a sensible headroom for the following few budgets, pulling a fair few levers looks very likely to me.

Only one item comes to mind that they won't pull on, state pension tripple lock. 

We will see on the 26th.

Shame, it’s breaking the economy, and quite frankly society.

Suppose if you repeat a mantra often enough some people will start to believe it.

Talk to anyone under 40 about what they think of the triple lock…

I do talk to people under forty on a regular basis and none I have came across are particularly fixated or against the triple lock, they all seem more interested in issues that are more relevant to them, like student debt, career progression or if they are in rental accommodation securiity of tenure.

For what its worth the only thing I can see wrong with the triple lock is that a sunset clause was not included to kick in when a threshold was met, but cannot imagine that would be to difficult to change.

Perhaps they are being polite?

Perhaps you should ask them direct questions about the triple lock? (Is it fair, should it be kept)

I suspect if you did that, then the most common reaction would be a blank look.

I think you will find their awareness of the intergenerational injustice is wider than you give credit.

In 20 years time they will understand how reasonable it all is.  Of course that assumes that they have the sense to put appropriate amounts into their pensions.

Actually the triple lock does not make a very great difference.  Since it was introduced in 2011 by 2026 SP will have increased by 89%.  If we just had a double lock the rise would have been 83%.

The SP won’t even exist in 20 years. If you are lucky and destitute you may get a small amount of pensioner UC.

Eldi_Dos

@ukdw

When an agreed threshold is reached I would think linking to earnings would be as good a way as any to mantain parity.

Cobbler_tone

This lot must know by now they are only getting one shot. They may as well scrap the triple lock, increase the pension age to 70, up the basic rate of tax to 30%, reduce the tax relief on pensions, put their mansion tax on and at least they can say they’ve reduced the national debt…maybe.
What happened to the time where people were only looking out for the rise in petrol, booze and fags?! Budgets are supposed to be boring.

Albermarle

Cobbler_tone said:

This lot must know by now they are only getting one shot. They may as well scrap the triple lock, increase the pension age to 70, up the basic rate of tax to 30%, reduce the tax relief on pensions, put their mansion tax on and at least they can say they’ve reduced the national debt…maybe.
What happened to the time where people were only looking out for the rise in petrol, booze and fags?! Budgets are supposed to be boring.

I am sure the Labour Party will not have given up on the next election, so will not be willing to take the flak for doing all those unpopular things.
As was once said a week is a long time in politics. In 3.5 years literally anything could happen.

Nebulous2

Albermarle said:

Cobbler_tone said:

This lot must know by now they are only getting one shot. They may as well scrap the triple lock, increase the pension age to 70, up the basic rate of tax to 30%, reduce the tax relief on pensions, put their mansion tax on and at least they can say they’ve reduced the national debt…maybe.
What happened to the time where people were only looking out for the rise in petrol, booze and fags?! Budgets are supposed to be boring.

I am sure the Labour Party will not have given up on the next election, so will not be willing to take the flak for doing all those unpopular things.
As was once said a week is a long time in politics. In 3.5 years literally anything could happen.

Yes - this. People forget how big a majority they have, albeit on a modest percentage of the vote. It's unlikely they wont be able to run for 5 years. Get the unpopular stuff out of the way now, and it will be forgotten about later. 

I'm still backing my view that bonds will benefit from the budget with real money... 

Cobbler_tone

Albermarle said:

Cobbler_tone said:

This lot must know by now they are only getting one shot. They may as well scrap the triple lock, increase the pension age to 70, up the basic rate of tax to 30%, reduce the tax relief on pensions, put their mansion tax on and at least they can say they’ve reduced the national debt…maybe.
What happened to the time where people were only looking out for the rise in petrol, booze and fags?! Budgets are supposed to be boring.

I am sure the Labour Party will not have given up on the next election, so will not be willing to take the flak for doing all those unpopular things.
As was once said a week is a long time in politics. In 3.5 years literally anything could happen.

You’re right. People tend to go with things if services are vastly improved but most importantly if they feel better off in their pockets. If they achieve that they have a good shot. Without the dreaded ‘I’ word, which seems pretty emotive.
Anyway, it’s not been a great start but plenty of time.

af1963

I'm old enough to remember how unpopular Margaret Thatcher was 18 months into government, even among Conservatives. 

Just checked the  details again: the Tories were 24 points behind Labour in Dec 1980 in what was still largely a 2-party system.  By Dec 1981 they were running third, 16 points behind the Lib SDP Alliance. But at the election in June 1983, they finished 16 points ahead of Labour and 18 ahead of the Alliance.

Anyone basing their personal financial decisions on the expectation that the next election is a cert for the current leading party is being hugely naive.

RogerPensionGuy

Cobbler_tone said:

This lot must know by now they are only getting one shot. They may as well scrap the triple lock, increase the pension age to 70, up the basic rate of tax to 30%, reduce the tax relief on pensions, put their mansion tax on and at least they can say they’ve reduced the national debt…maybe.
What happened to the time where people were only looking out for the rise in petrol, booze and fags?! Budgets are supposed to be boring.

Very strange optics and political situations are very fluid. 

I had guessed they would possibly get two sittings if they kept promises and acted in a reasonable fashion, unfortunately the first 16 or 17 months has been way off a sensible track.

So now they will need to show good management and be lucky and be very careful to be as nice looking as possible on the 26th to have a real possibility of getting a 2nd sitting.

They now find themselves between a rock and a rock and their next steps will need to be very careful and maybe no income tax rises until after the next election.