Sticky fingered government at it again?

sneekymum

Yes - my mother's one of the "I paid my stamp" brigade. She thinks the state pension's her entitlement - some of my tax goes towards her pension.

I like your "income support" idea - if state pensions were to continue though I think linking in an element of years of residency is still good.

Pal

I think they should scrap the second state pension/serps, and make the basic state pension a flat rate unemployment benefit that is payable, without means testing, to all people aged over 70 who have legally lived in this country for at least 10 years. Easy to understand, easy to administer, easy for people to plan for.

DavidLaGuardia

sneekymum wrote:

Yes - my mother's one of the "I paid my stamp" brigade. She thinks the state pension's her entitlement - some of my tax goes towards her pension.

I like your "income support" idea - if state pensions were to continue though I think linking in an element of years of residency is still good.

Some sympathy for you mum here. While it should be appreciated that there is no great savings scheme and it is always the tax payers of today that pay for today's pensioners, the welfare state has always given some universal benefits. These are the ones that mean all, irrespective of wealth can earna right to them or become entitled to them, meaning in part the wealthiest can feel their contribution is not just going to others. Examples include NHS, State pensions, Child benefit and Job seekers' allowance. It's a flawed but not entirely bad idea especially to a handfull of people who become wealthy in the end but may have, for many years, not been epecially well off but still put into the system and thus (in one point of view) deserve a return.

I personally don't like the income support rout as it would discourage savings on the margins.

Pal

DavidLaGuardia wrote:

I personally don't like the income support rout as it would discourage savings on the margins.

Why? It is only a name change. The amount of money has not changed.

Plasticman

sneekymum wrote:

Putting everyone on means-tested income support would certainly cut a lot of red tape.

but would also discourage people from saving for their old age. Isn't it time to 'bite the bullet' and make pensions compulsary? Then we can have means-testing for those who have not earned enough to provide themselves with a high enough pension.

sneekymum

But why make them compulsary? - I don't need a pension!

Though they're a good tax move at the moment - especially if you receive Tax Credits. Over half the IFAs I've spoken to don't know that you get 37p back for every pound you reduce your gross income by through pension contributions - in addition to the 22% tax back!

So yes I don't need a pension but I'd be nuts not to have one at the moment!

deemy2004

But you also need a pension pot of at least £40k in todays money to recieve more than a MIG.

Thus people putting away say £50 a month are literally throwing their money away which is much better suited in the likes of Cash ISA's