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The Great Pension Scandal

Discussion in 'Speaker's Corner' started by Stretch, Apr 6, 2015.

  1. The_Abyss

    Sgarrista

    Joined: May 15, 2007

    Posts: 9,829

    Location: Ipswich

    No, we are unable to agree as I never stated that the State Pension is affordable. It isn't, and the Government's actuary agrees.

    If you feel better knowing that you're helping someone else (although not enough, as the above confirms) do you feel terrible that others are paying to help you with your defined benefit pension?
     
  2. Faustus

    Soldato

    Joined: Mar 20, 2007

    Posts: 5,134

    No more than I felt terrible when I was working and helping to pay the pensions of those who went before me. In fact I didn't feel terrible at all, I realised that was the system, accepted it and was glad to contribute.

    We have the worst State Pension in the developed world and yet you claim it's not affordable. Surely that's a pretty shameful indictment on our taxation system then. I wonder too why it's only become an issue for today's generation.
     
  3. The_Abyss

    Sgarrista

    Joined: May 15, 2007

    Posts: 9,829

    Location: Ipswich

    Except at your age, you weren't really helping to pay the pensions of those who went before you because nobody believed there was a deficit so you weren't asked to pay more. The harsh reality is that the previous two or three generations didn't pay anywhere near enough for their defined benefit pensions, and now the current working generation are being asked to prop up the lot (although some of the earlier pensioners will now be deceased).

    I do claim it is unaffordable because that's what it is: https://www.telegraph.co.uk/pension...rs-50-face-tax-hike-pay-state-pensions-katie/ . The State pension is the broad equivalent of a national defined benefit scheme, with all the same problems. They're Ponzi schemes, albeit with an attempt to be prudent and responsible.

    Is that an indictment on our taxation system, or on how we spend our taxes, or both? Successive governments of all colours and leanings have put us into this position. It is an issue for today's generation because - generally - the principle of pensions in the UK is that those in receipt are not affected by change (unlike places like Greece for example, who decided to cut the value of pensions in payment: https://www.reuters.com/article/us-...ensioners-over-bailout-cutbacks-idUSKCN1C8113 ). Therefore, in this system, only the future can pay for the past.

    That's probably why the future doesn't appreciate being lectured by the past. The latter have a blank cheque, being signed by the former.
     
  4. Faustus

    Soldato

    Joined: Mar 20, 2007

    Posts: 5,134

    So you want to live in a society that punishes those that follow the rules, pay what they are asked to pay and then pull the rug out from underneath them when they are no longer in a position to do anything about it?

    If I wasn't helping to support those who went before me (I'm talking state pension) then where has my 49 years of NI gone to?

    BTW NI has increased a number of times during my 49 years of contributing.
     
  5. Dolph

    Man of Honour

    Joined: Oct 17, 2002

    Posts: 45,277

    Location: Plymouth

    NI is and always has been a ponzi scheme. The fact that it is a government run one doesn't change it.
     
  6. Spook187

    Sgarrista

    Joined: Jan 16, 2010

    Posts: 7,783

    Location: Cumbria

    Just checked mine, 29 years of full contributions so six to go then i jack in :)

    Well hopefully by 67 my 3 houses i shall own by then will be sold off, then offski to the sun to retire :):)
     
  7. Faustus

    Soldato

    Joined: Mar 20, 2007

    Posts: 5,134

    We are not the only country to use this model though.
     
  8. The_Abyss

    Sgarrista

    Joined: May 15, 2007

    Posts: 9,829

    Location: Ipswich

    You're continuing to not answer the questions that have been raised, and examples that have been given from other countries. Did you read anything about Greece, elsewhere and as linked above?
     
  9. Faustus

    Soldato

    Joined: Mar 20, 2007

    Posts: 5,134

    So you are using Greece as an example of a prudent economy now? I've said before we have the system we have and it's not about to change. My generation paid for the previous generations pension and was happy to do so and that's how it's always been.

    It is only 'this present' generation that want to move the goal posts - why is that? Pensions ministers have said that with the raising of the state pension age along with other adjustments means pensions will now be affordable going forward yet that doesn't seem enough for some people. I think therefore rather than me answer these 'questions' it would be better if you directed them at the pensions minister as nothing I'm going to say will satisfy you.
     
  10. Mercenary Keyboard Warrior

    Soldato

    Joined: Aug 4, 2007

    Posts: 7,056

    Location: Wilds of suffolk

    I will bite.

    One of the biggest changes which no one predicted, so no one planned for it, was the massive change in life expectancy. From a few years to now maybe around 20 on average depending whos figures you use.
    '
    That along with the dependency ratio, which was particularly low post war, due to you know significant numbers killed in the war. I don't know the UK figures )if even published) but the German one was unbelievable, the ratio went from something like 1:18 (ie 18 in work vs 1 dependency) to 1:6 within a short period we will have had similar but not quite as dramatic.

    So not only increased life expectancy but also dependency rations affected by the war, its not really surprising to see how the comparison of what you were "happy to do", although I would hazard a guess to say were probably blissfully unaware of, compared to what people will have to face now and with increasing ratios of dependents to workers it will only get worse. All the time those taking in are more likely to live in their own home and maybe own one to let out, they young are trapped, not by house prices directly but the biggest hurdle for most is deposit, then quite quickly followed by job insecurity.

    Its not apples for apples and as such its an irrelevance to say its the same. Things change and things move on, you have to adapt. There are no guarantees on pensions (state) and I doubt there ever will be.
     
  11. Faustus

    Soldato

    Joined: Mar 20, 2007

    Posts: 5,134

    And you think things have stood still during the 49 years I have been paying N.I. and income tax, and will continue to pay income tax although now retired. Germany is in a worse position than the UK hence why Mrs Merkel welcomed all the refugee's. The U.K. has recognised the issue and has acted to mitigate the effects e.g. raising the state retirement age. Both the main political parties have openly stated that these measure will be enough to make pensions fair and affordable going forward. In fact the measures gained cross party support.

    I spoke to my daughters about this issue as it's their generation that will be paying. Both said they had no issue whatsoever with the concept of their generation providing the pensions for those that have gone before them.
     
  12. Mr Badger

    Soldato

    Joined: Dec 27, 2009

    Posts: 5,366

    Dad is going on about pensions again. Do you:

    1) Agree with him and get on with your day; or

    2) Attempt to explain some facts to him and get trapped in a never ending and unwinnable argument*

    *see this thread for examples
     
  13. do_ron_ron

    Soldato

    Joined: Oct 23, 2002

    Posts: 7,377

    It is not though. Private pensions are ring fenced but state pensions are not, coming out of general expenditure. Your daughters are only paying into the Govt pot from where all expenditure comes. You could equally say they are paying for MP's expenses.
     
  14. Mercenary Keyboard Warrior

    Soldato

    Joined: Aug 4, 2007

    Posts: 7,056

    Location: Wilds of suffolk

    Well what they have done is for the future upped the age and say they will again the state retirement age.
    Rather than set arbitrary points and leave the vastly unchanged (as they did for many many years post war) pretty much everyone agrees the previous level was unsustainable.
    The problem as pointed out many times over, but is basically ignored, is that whilst this sounds fine in practice in reality it fails quite dramatically.

    Most physical trades take a toll on the body, they don't change with life expectancy, they still screw the body, and some professions/trades just don't work with an ageing workforce. Its not really fixed the issue, its just kind of kicked the can into the long grass a fair way down the road. Imagine a 72 year old copper chasing some youths after some low level street crime. A 68 year old fireman, etc Most construction trades people are shot by the time they get close to current retirement age, bad bacs, dodgy knees, problems with hands etc

    The main problem boils down to not enough contributions. In the past this was worse than now but its still the same issue, people are not saving/paying enough, plus they have to cover the shortfall from those who came before.
    No one foresaw the dramatic life expectancy increase, but its political suicide to suggest people contribute enough, for reference just look at the reception May got and how quickly they back peddled from the suggestion you should pay for your care in old age if needed.
     
  15. Faustus

    Soldato

    Joined: Mar 20, 2007

    Posts: 5,134

    I agree about retirement ages for some of the heavier industries/services. I said right from the start I can't see a 60 plus fireman running out of a burning building with some fat geezer over his shoulder - just plain ridiculous. Has anything been sorted about what will happen regarding the heavier jobs and the raising of retirement age?

    Well given I've already retired and paid in a lot of unnecessary extra years N.I. plus I'll still be paying tax, then there's little I can do now whatever the rights and wrongs of pension funding.
     
  16. Rroff

    Man of Honour

    Joined: Oct 13, 2006

    Posts: 59,080

    Yeah no way on earth I'll be doing my job much past 60 - though I don't intend to stay in my current role long term any how. Saturday for instance I covered 14km with ~36kg of gear.
     
  17. Mercenary Keyboard Warrior

    Soldato

    Joined: Aug 4, 2007

    Posts: 7,056

    Location: Wilds of suffolk

    Its not just the obvious heavy industries services, its many of them, I would probably argue all of them, it just depends on how severe the average impact will be.
    Nursing requires physical activity, many suffer bad backs etc by their late 40s/50s.

    Other age related illnesses impact being able to do jobs, everyone thinks office work is easy. There is still lifting, there is long term periods of inactivity, mainly need keyboard skills, try doing that with arthritis.

    Some will be able to work well into their 60s/70s, plenty won't. Problem is its too late to retrain them, and it just makes it worse for youngsters starting out.

    You didnt pay unnecessary years NI, its not a ring fenced pension contribution, its to cover the current costs of social elements within our economy. Thats a very broad definition as basically it goes into general taxation like the vast majority of taxes. In fact its nigh on impossible to find a tax of any relevance that doesn't just get put into the pot.
     
  18. Darujhistan

    Mobster

    Joined: Oct 28, 2011

    Posts: 3,190

    Private pensions are ring fenced


    That's a myth, ask any of the workers whose pensions pots have been stolen by their employers and then disappeared at least in part when a company goes under. A pension is no different to gambling, expect it's a gamble people are forced into taking.
     
  19. Mercenary Keyboard Warrior

    Soldato

    Joined: Aug 4, 2007

    Posts: 7,056

    Location: Wilds of suffolk

    @Darujhistan

    Your very mistaken here.
    I am afraid typical of how mistruth is told and passed on from one person to another who also has no clue.

    Your probably relating back to the Robert Maxwell times, things have changed massively since then.
    That also was a DB scheme not a DC. DB they do need to retain access as they have to administer the scheme. But even that is vastly different now.

    In DC schemes once your money is in your pot its got absolutely no access by your employer. As most people now have Dc schemes then its most relevant, especially for new people signing up (or being forced to sign up)

    Please educate or stop posting when you dont understand, these sorts of misinformation posts help to perpetuate the myths that have either been changed or were just plain wrong in the first place.
     
  20. Spook187

    Sgarrista

    Joined: Jan 16, 2010

    Posts: 7,783

    Location: Cumbria

    I can't see myself doing my job in my 60's (Railway industry) 35 years of paying would be in, so probably just go on the sick in my later years and milk the system :):):)