Pensions to rise with inflation - but what about working people???

[doris9034]

BBC Website: "Liz Truss and Chancellor Jeremy Hunt jointly agreed to guarantee that the state pension rises with inflation next year - thereby maintaining the "triple lock" - ahead of PMQs this morning, Downing Street says.
In a huddle with reporters after PMQs, the prime minister's official spokesman said the decision reflected the "unique position" of pensioners who are "unable to increase their earnings through work"

But I - and millions of others - are also unable to "increase our earnings through work" because we are in the middle income bracket, our employers do not have the capacity to raise our earnings in line with inflation and we don't qualify for any state related benefits.

So, whilst I 100% don't begrudge the helping of pensioners (many of whom are probably among the better off anyway), I can't help but feeling a bit annoyed that it always seems to be the ordinary working person / family that never gets any respite from the ever increasing cost of living.

There was no paid for child care in those days

Are you talking about the 15 free hours that starts at 3?

I never get any help at all. I’d love to offset the rising cost of living by paying a bit less tax, but not at the expense of:

• people having enough food
• people living in homes which are warm enough to avoid making them sick
• a functioning health system
• a functioning national defence
• children being educated
• criminals being caught and (if necessary) locked up

I’m furious at the government making the oncoming storm even worse than it was going to be. I’m upset that my standard of living will likely fall. But those of us fortunate enough to not be having to choose between heating and eating need to get a grip.

What I find frustrating is a lack of acknowledgement of the chaos that the current working population face as a result of an ageing population, declining working population and our governments failure to adjust public policy accordingly.

Pensions are a ticking time-bomb. Today there are, on average, 3.4 working-age people to support the retirement of every person 65 and older. By 2050, the year when many of todays workforce might be expecting to retire, that number is projected to dwindle to just to just 2.0. Essentially, pension funding will simply not be available to sustain retirement of the next generation.

Longer life spans will require that younger people save significantly more and postpone retirement by a number of years. The reality is that this is not possible for the vast majority in light of stagnant wages, extortionate house prices, rising taxes and other costs.

So whilst yes, not every pensioner is well off and yes, people who are retired now deserve that retirement, let's be realistic about the future and the fact that retirement as a concept won't be an option for many.

I'm apoplectic however that the government is avoiding committing to increasing benefits given the horrific rise in the cost of living, shame on them!!

Successive governments have sleepwalked into this. The last boomers were born in 1964. There’s been over half a century to prepare for this and what’s been done? Nada. Put the blame where it belongs.

What I find frustrating is a lack of acknowledgement of the chaos that the current working population face as a result of an ageing population, declining working population and our governments failure to adjust public policy accordingly.*

Yes & any discussion is jealousy, ageism or the fault of the boat people.

Yep, and the NI scheme that you can use against childcare. No tax credits either

No, it’s not comparable. Many pensioners still have to pay rent and heating etc. However have you done the maths on paying rent and gas/electricity bill with all of £150 a week? I don’t see how many can survive. Of course there are pensioners who are rich, but the vast majority aren’t.

Much of the younger generation doesn't expect a state pension anymore, I don't. I very much think my generation will be work till you drop. Unless you're from a wealthy family, inheritance, or we're on a high enough wage, like a GP salary to be able to save into private pension. The alternative for my generation will likely be a trip to Switzerland when it all gets too much. The problems has been so neglected for so long, even left wing government can't fix it. I hope I'm wrong on all fronts. But unfortunately I wasn't wrong about Brexit vote winning, even if the bookies thought otherwise!

And they called other benefits 'income supplement', 'widowed mothers' pension', 'support', 'tax credit', 'allowance', 'payment', 'credit' and 'guarantee'. It doesn't change the fact that they are all benefits paid for at the time of claiming by other people and can and will be taken away if the government in power at the time decides not to pay them or changes the terms and amounts.

But choosing the name insurance was clearly a good move all those years ago when it was first used to describe the system where working people would receive a proportion of costs for medical treatment, sickness benefit for 6 months and unemployment benefit for 15 weeks, as people still believe they are different to every other benefit paid and not funded by those currently earning an income through their deductions from earnings. Old Age Pensions were non contributory.

Like endowment mortgages, if you got in at the right time and cashed in/needed to claim, you did well, but if you didn't, due to a decrease in the working population and prevalent economic conditions/political expediency, you don't.

I fully expect the state pension age to be 75 within the next five years. If it still exists. After all, plenty of other benefits claimable as a result of NI contribution records don't or have had the terms hugely reduced.

Beneath this argument about relative government expenditure on pensions vs in work benefits lurks the most important, and least well understood, fact about how the British state is structured, who it is designed to serve, whose labour is extracted to fund it and who benefits from that extraction. The rich all know it; most of the non-rich are ignorant of it; the media and most channels of public discourse collude with the rich in obfuscating it.

That is that the degree to which you benefit from the economy and government policy has nothing to do with income, and everything to do with asset ownership.

Compare the net worth of an average 25 year old worker and an average 70 year old pensioner, and you can immediately see why their situations are in no way comparable.

@ArseInTheCoOpWindow what point are you trying to argue this time? That childcare is cheaper these days?

@FacebookPhotos I completely agree. What frustrates me the most is that I can’t see that any of the parties have recognised we have a fundamental shift in demographics and there needs to be a complete shift in policy.

Not the odd windfall tax, or fiddling with triple locks, or targeting ex pats, or Google/Amazon, taxing private schools, raising tax thresholds a bit, expecting public sector workers to go for years without a proper pay rise on the promise of their pension, asking our NHS/schools to deliver first rate care with third world resources. These are sticking plasters that don’t address the fundamental issues. The whole system needs ripping up and starting again. But none of them seem bright enough to do it.

@scaredoff Quite. Interesting how resistant some of the retirement benefits claimants on this thread are to the idea. It's really not a savings account, it's a state benefit with eligibility conditions. There is no logic in giving it greater protection. Its claimants are no more deserving than others and, frankly, have less claim on public sympathy and funds than children growing up in poverty whose whole life chances hang in the balance.

I think Cameron's gov were looking at some planning for the demographic changes but Brexit took over.

They should increase pension credit but not the basic state pension.

People didn't 'pay in', they payed tax that payed for their parents and grandparents pensions. It's all gone. Now they want younger people who didn't have the cradle to grave welfare state to support them to prop up a generation who made tax free ££££ on house price increases that are crippling the young.

I had a pensioner argue with me when I told her pensions were the largest proportion of benefits by some way, I got all the ‘ It’s not a benefit, I paid in all my working life, it’s what I’m due, it’s a pittance anyway blah blah’.

Just wasn’t interested in the facts that whatever she paid in wasn’t nearly enough to support someone living 30 or more years of retirement, there is no pension pot, changing demographics, pensioners are better off than working people etc.

There will be no state pension for all young people, there’s no way this situation can go on for another few decades. The U.K. is a gerontocracy and it’s about time it changed.

have less claim on public sympathy and funds than children growing up in poverty whose whole life chances hang in the balance

Current pensioners have paid for two, if not three, previous generations’ pensions. If that doesn’t give them a valid claim to their own pensions, I don’t know what does. Wealthy pensioners are tax payers and the wealthiest return their state pension to the treasury via income tax. In fact, many would be better off by not claiming it in the first place.

@LibrariesGiveUsPower I agree, that’s not sustainable. I had, perhaps, naively thought pensioners on state pension alone had some help with their rent. Where that isn’t the case, they absolutely need help. But I think my argument would be that it could be targeted to those who need it. Unlike my mum, who I mentioned unthread, really won’t miss her state pension lacking an uplift. Especially given her £250k savings, where God knows she’s complained enough about low interest rates impacting the returns on her substantial pot. And can now get returns of over 2.5% on it. That’s c.£6k extra a year she’ll get from higher interest rates.

There will be no state pension for all young people, there’s no way this situation can go on for another few decades.

Why not?

What's to stop the government from just continuing to screw the young, run threadbare public services that just about keep most people from premature death but no more, in order to keep pushing the money to the retired side of the balance sheet?

It's no different from any other kind of structural inequality, like those built into land ownership or education systems for example, and God knows they've been around for long enough without looking like going anywhere soon.

But where do you draw the line? I paid off my mortgage at 47 ....I'm now 57 ....retired and returned nhs so working 2 days a week and picking uparound the same as when I worked 5 days a week....I have 6 figure savings which include my nhs lump sum ...I will quit working before 60 but when I'm 67 I think I'm entitled to a full state pension and everything that comes with it ....I've paid my NI .....why shouldn't I get my state pension?

I agree, that’s not sustainable. I had, perhaps, naively thought pensioners on state pension alone had some help with their rent.

They're eligible for housing benefit, means tested the same as anyone else, aren't they?

The average life expectancy is dropping....not many people will live beyond 97 ( thats 30 years post 67 ...the age I will get my pension)

Yes they are...if they have no other pension or minimal savings

@kitcat15 apologies, but I think if you have 6 figure savings, regardless of how long you’ve worked. Asking working families to subsidise a 10% increase in your pension, at the expense of working families who can’t afford to feed their kids is a bit much.