h2g2 The Hitchhiker's Guide to the Galaxy: Earth Edition

Though not of course for Prime-minister's non-contributaory pension of 50% of salary available immediately upon leaving No 10.

And the rest!!

I have an NHS pension (UK) which is frozen at the point I left the NHS. I am now contributing to a scheme that has remained final salary following a review. I still anticipate having to work until I am at least 65 if not longer. 10 years ago I had made pretty firm plans to retire at 55 (without loss from the NHS scheme as one of the 'special classes'). This was based on pension and other investments like endowments.

All I can now say is.

Nobody can be said to be to blame for the pension situation. As a closet Marxist I could say that the root of the problem is the Capitalist system but I also believe that a good proportion of the wage earning population live for the now and don't think about providing for their futures. One could even blame medical science for making it possible for us to live for longer in retirement than we spend gainfully employed.

A good example of this is the NHS scheme that allows certain classes of employee to retire after 30 years of service. If one of these employees started at age 18 they could retire on a full pension aged 48. if they live to be 90 they will have worked for 30 years and had a pension from the scheme for 42 years. This is unsustainable in an ageing population.

turvy

I frequently worry about the pension situation in the UK. As all the baby boomers start to retire over the next ten years my NI that I am paying now will be going to support those retiring *now* because there isn't enough in the pot already to pay for them.

At the same time I am trying to save up for when I retire in 30 years or so. When I finally get to retire I seriously doubt there will be any state pension for me at all. I'm being sensible and saving now as well as paying my stamp so I expect that those that are not saving now will qualify for state pensions and I won't because it will be entirely means tested by then if it exists at all. I kind of feel that I am paying out a lot for state pensions that I will never be entitled to because I'm being prudent and ensuring that I can look after myself in my old age.

I can't see any solution to the whole problem *except* requiring people to retire later if they are healthy enough to continue to work and have not made sufficient provision for themselves to retire at 65.

As I've said elsewhere, my non-contributory, index linked pension is me being prudent and looking after myself. Thats why I'm still in a job with a (relatively) low income, p*ss-poor working conditions and no perks whatever - Get a company car? We don't. Get a christmas party paid for by the firm? We don't. Get a Christmas Bonus? We don't. Get to be treated as political football? We do.

There are ways to solve the pension crisis. Having SENSIBLE debate immigration and the need for it when the ratio of those in work to those retired has fallen from 10-1 to 4-1 in the last two decades would be a start.

Get a company car? Nope .
Get a christmas party paid for by the firm? Nope (don't know many people that do these days) .
Get a Christmas Bonus? Nope .
Get to be treated as political football? Nope, .

"There are ways to solve the pension crisis. Having SENSIBLE debate immigration and the need for it when the ratio of those in work to those retired has fallen from 10-1 to 4-1 in the last two decades would be a start."
I agree with you here Blues, the working age population will need to increase to support the retired. Is it feasible to do this entirely through immigration though? I don't really see how healthy people can expect to retire and be provided for by the state for almost as long as their workng lives lasted (this isn't aimed at public sector workers, but everyone).

I agree, and I take your point. Actually, the public sector problem is solved by changing the contracts for new entrants, which will change the landscape quite dramatically in that regard.

I don't *think* this government (or any other, for that matter) has the political will to force a confrontation with the entire civil service. Even Thatcher used to go (relatively) soft with us.

And you're right, immigration alone *won't* solve the problem. We need to tighten up regulations to avoid the sort of legal 'plundering' that happened to Courts and Rover, and Pension Funds need to dis-abused of their slavery to the market, which has led to enormous problems.

One of the problems with the Son of the Manse's redistributive policies is that it penalises savers in two ways. Firstly he hit the pension funds to the tune of £5bn. That is £5bn that will go to the poor, whoever they are, and not to people who have tried to save for their retirement.

Secondly by means testing benefits, including care for the elderley, there is no point in saving for your old age. If you do you will be penalised when it comes to claiming your share of public expenditure that you have contributed to all your working life via income tax and NI. You are better off as a Frank Gallagher and let the State carry the burden.

>the poor, whoever they are<

Well, that'll be the approximately 2 million kids who still live below the poverty line then. Those sort of 'poor'.

I haven't got any stats but I wonder how many Pensioners live below the poverty line ?

That depends on your definition of the word 'poverty'.

Your point?

My point is that there may well be more poor pensioners than poor children. But Prudence has chosen to redistribute towards children not pensioners. However some of those pensioners may well have worked all their lives and paid tax and NI and now find themselves poor because of New Labour policy.

Hmm, well, he was, I think trying to solve one problem without excacerbating the other. 5bn is a drop in the ocean of the pensions hole and has probably done some real good at the other end of the scale.

I do take your point though, put in those terms. To be honest, Brown's simplest solution would be to slap a penny on NI like he did for the NHS. I think people would probably go for that, and it likely only need to be a one off measure to correct the balance.

They also need to look at how they deal with the Council Tax and pensioners - it was the one bit of Letwins economic policy that made sense and is easily paid for by stiffing the mega-rich with a higher tax band.

Yes but there's the rub. Labour would put a penny on NI and up the income tax rates at the top end but New Labour can't becuase it's right wing. I've just heard on Labour MP on Radio 4 saying he thinks this government is more interesed in privatisation than improving the public sector.

Well, he put a penny on NI for Health. It may be the only way out of the problem.

I think ANY government is going to have to increase income tax - or reduce spending - at the moment the figures just don't add up.

If people are encourage to work longer to fund their retirement, might that not create a rise in unemployment?