The "rape" of the National Insurance Fund

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Mrs_pbradley936
Mrs_pbradley936 Posts: 14,567 Forumite
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edited 6 August 2018 at 2:35PM in Pensions, annuities & retirement planning
I came across this little gem which a a draft prepared for the National Pensioners Convention:

http://www.singernet.info/southwarktv/spag/spagNIFund.asp

an wondered if it is a) true & b) if it has any great impact on the way pensions are costed.
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  • kidmugsy
    kidmugsy Posts: 12,709 Forumite
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    Mrs_pbradley936 wrote: »
    wondered if it is a) true & b) if it has any great impact on the way pensions are costed.

    Looks like rubbish to me. But then I stopped at "The suggestion that the Fund exists only on paper and is not available for spending is unfounded. The money is invested in gilt-edged securities."

    Since gilt-edged securities are issued by HM Treasury you can see that the existence of this fund is just flim-flam. It was the socialist cabinet minister Nye Bevan who said that "The secret of the National Insurance Fund is that there ain't no fund". That man was right about very little but he was right about that. If you want to see what a genuine government-owned fund looks like read up on the Norwegian "Government Pension Fund Global".
    Free the dunston one next time too.
  • dunstonh
    dunstonh Posts: 116,385 Forumite
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    But then I stopped at "The suggestion that the Fund exists only on paper and is not available for spending is unfounded. The money is invested in gilt-edged securities."

    you did better than me. I stopped straight away when I saw the tiny text, poor reading font on a blue background.
    I am an Independent Financial Adviser (IFA). The comments I make are just my opinion and are for discussion purposes only. They are not financial advice and you should not treat them as such. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.
  • nrsql
    nrsql Posts: 1,919 Forumite
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    I was cautious after the subject
    >> What difference does this make?

    Then when I saw it was just a link I assumed malware or at best clickbait.
    Surprised others seem to have followed it.
  • Mrs_pbradley936
    Mrs_pbradley936 Posts: 14,567 Forumite
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    nrsql wrote: »
    I was cautious after the subject
    >> What difference does this make?

    Then when I saw it was just a link I assumed malware or at best clickbait.
    Surprised others seem to have followed it.

    Don't you look to see if a person putting up a link has a pedigree on here before jumping to conclusions?
  • Mrs_pbradley936
    Mrs_pbradley936 Posts: 14,567 Forumite
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    kidmugsy wrote: »
    Looks like rubbish to me. But then I stopped at "The suggestion that the Fund exists only on paper and is not available for spending is unfounded. The money is invested in gilt-edged securities."

    Since gilt-edged securities are issued by HM Treasury you can see that the existence of this fund is just flim-flam. It was the socialist cabinet minister Nye Bevan who said that "The secret of the National Insurance Fund is that there ain't no fund". That man was right about very little but he was right about that. If you want to see what a genuine government-owned fund looks like read up on the Norwegian "Government Pension Fund Global".

    Well I just did a Google and it seems we do indeed have a fund and it publishes accounts: https://www.gov.uk/government/publications/national-insurance-fund-accounts
  • kidmugsy
    kidmugsy Posts: 12,709 Forumite
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    Mrs_pbradley936 wrote: »
    Well I just did a Google and it seems we do indeed have a fund and it publishes accounts: https://www.gov.uk/government/publications/national-insurance-fund-accounts

    You miss the point. It's a fiction - how can you possibly believe that there's a fund there when it's "invested" in HMG's paper? It's not a thing, it's a vacuous accounting convention. I repeat - look up the Norwegian fund. It's real.
    Free the dunston one next time too.
  • Linton
    Linton Posts: 17,173 Forumite
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    Mrs_pbradley936 wrote: »
    Well I just did a Google and it seems we do indeed have a fund and it publishes accounts: https://www.gov.uk/government/publications/national-insurance-fund-accounts


    It is a notional fund - there are no actual assets of £21Bn held for example in bags of gold in some goverment vault. It is simply a way of accounting that highlights important aspects of the cash flow from contributors to recipients.
  • Aberdeenangarse
    Aberdeenangarse Posts: 1,258 Forumite
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    Mrs_pbradley936 wrote: »
    Well I just did a Google and it seems we do indeed have a fund and it publishes accounts: https://www.gov.uk/government/publications/national-insurance-fund-accounts

    Not a fund, more like a ‘current account’ what’s paid in is then paid out, with a vast majority of it going to fund State Pensions. It usually has to be ‘topped up’ by the Treasury.


    https://www.moneymarketing.co.uk/issues/29-june-2017/paul-lewis-scrap-national-insurance-contributions/
  • Aberdeenangarse
    Aberdeenangarse Posts: 1,258 Forumite
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    kidmugsy wrote: »
    You miss the point. It's a fiction - how can you possibly believe that there's a fund there when it's "invested" in HMG's paper? It's not a thing, it's a vacuous accounting convention. I repeat - look up the Norwegian fund. It's real.

    Indeed, a bit like my beer fund. A fictional amount set aside for me to spend in the Pub which is usually not enough. :beer:
  • Andy_L
    Andy_L Posts: 12,795 Forumite
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    Its about 15 years old and one of its points is that breaking the link between pensions and wages but only increasing them by inflation has increased the surplus.
    Since we've had the triple-lock, reversing that policy, for 8 years I suspect its assumptions & numbers are well out of date
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