General Election June 8

[vtsnowedin]

I don't care what anybody thinks. I paid it in and I want it back as it's MY money.

I don't know how it works in the US but that isn't how it works here for the state pension (obviously private pensions are different). With the state pension it's more like "I paid it in and..." the government immediately spent it on all sorts of things including paying the previous generation's pensions! Our government has a habit of spending every penny it collects (and then some).

I have both the government Federal pension and a State pension as I worked for a state highway department. The federal money has mostly been squandered and the scheme will eventually fail (hopefully after I and my wife are gone) but the State pension fund has been invested in the markets and widely diversified and now amounts to several billions so should last well beyond us. We once got the book of all the stock and other assets the fund owned. Huge blocks of stock in almost every good company you could think of plus commercial real estate and timberland.

[clv101]

Private pension and state pensions are very different things - as you know.

The private pension is simply a tax efficient (to encourage people) way of saving with strings attached about its withdrawal. No more, no less.

The state pension is a publicly funded payment to older people with eligibility depending on years worth of NI contributions or meeting other eligibility criteria (like child benefit).

The word 'contribute' is a problem here - it implies people are contributing to their own state pension. They aren't. They are simply paying tax, tax the government then choses how to spend.

As you know the (full) state pension requires 30 qualifying years. Someone earning £8,000 a year for 30 years will (at current prices/rules) 'contribute' zero NI payments yet still be eligible for full state pension, someone earning £20,000 will 'contribute' some £1,400 a year (£42k in total) to be eligible, someone earning £40,000 year with 'contribute' some £3,800 a year (£114k in total) to be eligible for the same state pension.

The state pension isn't related to your 'contributions' it's related to your qualifying years, that makes it very different from a private pension.

We aren't forced to contribute to our state pension, we're forced to pay our taxes. The government of the day they choses how to spend the tax receipts. I would like the government of the day to means test the state pension by (say) not paying it (£8k of public money) to higher rate taxpayers (earning over £45k) just because they are 65+ and clocked up 30 qualifying years. There are simply better things we could be doing with today's tax receipts than giving big chunks to already wealthy people. Obviously the state pension income is taxed, so 'we' get 40% back... I'd just like to see us get 100% back.

[clv101]

I have both the government Federal pension and a State pension as I worked for a state highway department. The federal money has mostly been squandered and the scheme will eventually fail (hopefully after I and my wife are gone) but the State pension fund has been invested in the markets and widely diversified and now amounts to several billions so should last well beyond us. We once got the book of all the stock and other assets the fund owned. Huge blocks of stock in almost every good company you could think of plus commercial real estate and timberland.

Your 'Federal pension' sounds like our government state pension, and your 'State' pension sounds more like a private pension or employer administered scheme with an actual pile of assets behind it.

It's a shame that our government seem happy for people to confuse the two with many people thinking there is actually a big government fund, to which they contributed, and can withdraw from upon retirement. It just ain't so.

[emordnilap]

I don't care what anybody thinks. I paid it in and I want it back as it's MY money.

How the middle east wishes you - and all other American taxpayers - had kept it, vt.

[Little John]

I have both the government Federal pension and a State pension as I worked for a state highway department. The federal money has mostly been squandered and the scheme will eventually fail (hopefully after I and my wife are gone) but the State pension fund has been invested in the markets and widely diversified and now amounts to several billions so should last well beyond us. We once got the book of all the stock and other assets the fund owned. Huge blocks of stock in almost every good company you could think of plus commercial real estate and timberland.

Your 'Federal pension' sounds like our government state pension, and your 'State' pension sounds more like a private pension or employer administered scheme with an actual pile of assets behind it.

It's a shame that our government seem happy for people to confuse the two with many people thinking there is actually a big government fund, to which they contributed, and can withdraw from upon retirement. It just ain't so.

It also isn't so with regards to private pensions or, indeed, any "monetary" based "asset" for all of the obvious reasons relating to the nature of FRB and the limits to growth. But, of course, you wouldn't acknowledge that in the context of your "private" pension, now would you CLV.

Clearly, intelligence and a good education are no barriers to rank hypocrisy. Again - where have I seen that particular combination of qualities before?

[clv101]

I have both the government Federal pension and a State pension as I worked for a state highway department. The federal money has mostly been squandered and the scheme will eventually fail (hopefully after I and my wife are gone) but the State pension fund has been invested in the markets and widely diversified and now amounts to several billions so should last well beyond us. We once got the book of all the stock and other assets the fund owned. Huge blocks of stock in almost every good company you could think of plus commercial real estate and timberland.

Your 'Federal pension' sounds like our government state pension, and your 'State' pension sounds more like a private pension or employer administered scheme with an actual pile of assets behind it.

It's a shame that our government seem happy for people to confuse the two with many people thinking there is actually a big government fund, to which they contributed, and can withdraw from upon retirement. It just ain't so.

It also isn't so with regards to private pensions. But, of course, you wouldn't acknowledge that, now would you CLV.

Clearly intelligence and a good education are no barriers to rank hypocrisy

But it is so. Private and employer administered schemes DO have an actual pile of assets behind them in a way the state pension doesn't (of course the pile of assets can be 'lost' through bad decisions or fraud etc). SIPPs make this abundantly clear allowing you to administer it yourself, putting a pension wrapper around a huge range of assets.

I don't know what you're are accusing me of not acknowledging. There is a fundamental structural difference between the state pension and private pensions - surely you can acknowledge that?

[kenneal - lagger]

If a private individual or company had devised the State Pension they would be prosecuted for running a Ponzi scheme with payments out being funded from current contributions not assets. The state pension relies on continual growth to keep solvent but unfortunately, as we all know here, that continual growth is coming to an end and so the pension provisions are having to the rolled back. Even some "fully funded" private schemes are unravelling because Gordon Brown raided them during his time as Chancellor to bail out Labour's spending plans because they looked a little bloated after a time of spectacular growth and they are now unable to fund the promises made in those earlier more affluent times because of current lower growth.

[AutomaticEarth]

There you go people,

Der Blairenfuhrer ist bach lol:

http://www.standard.co.uk/news/politics ... 27641.html

[raspberry-blower]

Even some "fully funded" private schemes are unravelling because Gordon Brown raided them during his time as Chancellor to bail out Labour's spending plans because they looked a little bloated after a time of spectacular growth and they are now unable to fund the promises made in those earlier more affluent times because of current lower growth.

Having worked for a pension fund that would come under your classification as being "fully funded" this is not the full picture - not by a long way.
Firstly, it was known that well before Blair or Brown got to office that there would be a pensions crisis simply due to the fact that retirees were living longer and that there were less contributors paying in. Using the BAU economic model (yes, I know that is a nonsense) major problems ahead when the baby boomers retired was seen as inevitable.

Your point was that Brown raided the pension funds to fund his spending plans - actually that was one of the first things that he did. This was done on dividend payments - on a share dividend there is not only the rate of payment per share the dividend also has a notional tax credit. This was something that pension funds could claim back from HMRC until 1997 when Brown changed the rules. However, to blame all the woes of the pension "industry" on this is missing the point somewhat.

The financial crisis of 2008 and the subsequent QE, along with low interest rates, has been the real killer. Pension funds require interest payments from their assets to fulfil their obligations - with virtually zero% interest rates pension funds are investing in ever riskier ventures just to obtain a yield. The Treasury market simply isn't yielding anywhere near enough. It should also be noted that some larger pension funds own shopping malls and other commercial real estate that isn't performing particularly well at present - on current trends this is likely to get worse.

There has already been the closures of final salary pension schemes - I can see that this situation will only deteriorate further. As George Carlin noted the pensions will vanish the moment you come to make a withdrawal

Mods do you think this should become a separate topic?

[emordnilap]

Never believe anything until it's officially denied:

Lord Warner said: “The government has no plans to privatise the NHS.”

Source

Britons have a duty to vote Labour.

[clv101]

It seems the Tories, faced with the likelihood of a landslide victory, are burning some 'excess' political capital to push through some pretty unpopular stuff in their manifesto. The new funding scheme for social care, dropping the pension triple lock for a double lock and means testing the winter fuel payment.

Personally, I think dropping the triple lock and means testing winter fuel payment are very good moves. The changes to social care funding is more interesting though.

Effectively, it's a wealth tax, your capital rather than your income or expenditure is being taken to pay for public services (social care). So far, great! The problem is the random nature of it. If you are unlucky enough to need many years of social care, you 'lose' everything, down to your last £100k. If you never need any social care you don't pay a penny. I'd much prefer a system where everyone was exposed to a little bit of 'wealth tax' and everyone's social care was paid for, rather than this tax-by-chance system.

[AutomaticEarth]

The Tories have bombed in the latest polls; Labour are now only 9 points behind.

Has Theresa May become Theresa Corbyn?

Seems an odd stance given the upcoming Brexit negotiations. Saying that, she might be angling for Labour voters.

Also, why is the BBC banging on about Scotland when I live in the south east?

Obviously they have money to burn.....

[UndercoverElephant]

Arrogance. They believed they were so certain of a huge majority that they could get away with anything, including policies guaranteed to alienate much of their core vote. Now I suspect they may not get a majority at all. Very hard to fix this social care thing. They've broken their campaign slogan, and even today's U-turn doesn't fix it because they haven't specified the level of the cap. And even specifying it won't help, because the higher the figure the more of their own supporters they will alienate and the lower the figure the more they are in trouble over their figures not adding up.

Total c*ck-up. All they had to do to win this election was not make any major mistakes, and they have failed.

[clv101]

Total c*ck-up. All they had to do to win this election was not make any major mistakes, and they have failed.

Indeed, it's certainly an unforced error. I really doubt it's enough to lose the majority though, not unless the media really go after May in a way they haven't so far.

She doesn't seem to cope well under hostile pressure if today's questioning is anything to go by.

[UndercoverElephant]

Total c*ck-up. All they had to do to win this election was not make any major mistakes, and they have failed.

Indeed, it's certainly an unforced error. I really doubt it's enough to lose the majority though, not unless the media really go after May in a way they haven't so far.

I'm not sure the media has much control over this. The Tories' problem is that this directly affects a lot of people whose votes they need, especially swing voters. It is not May they don't like - it is the policy. But it is very hard to see how the policy can be fixed. There's been something of a news blackout since her speech in Wales - nobody knows what to say, because the first attempt to fix the problem actually made it worse. I think they are in deep trouble.