The state pension is HOW MUCH???

[BeatieBourke]

Call me stupid (fair) but I've just realised how much the state pension is. £800 odd a month (£185.15pw).

As a non-means tested benefit. For EVERYONE.

I'm generally of the opinion that benefits are too low and too punitive. I usually advocate for universalism. I understand that people have worked their whole lives and paid in, and deserve a retirement. And that having pensioners in poverty does no favours to the economy or other welfare services.

But £800 a month / £9k a year for EVERYONE?? So a widower in rented accommodation with no other income or savings, £800pm. A wealthy 68 year old who's earned a 6 figure salary, has a huge property portfolio and investments coming out of their ears that pay a fortune out in dividends, £800pm. Seriously?

I understand that no party, least of all the Tories (because tory voters as a population are older) will ever go after pensions because it would be unpopular (and older people vote more generally). But in a time when the country is supposedly facing a financial "black hole" and everything else has already been cut to the bone for the last 12 years, why the hell are we paying out state benefits to millionaires?

Maybe if pensions were means tested (with a fairly high and tapering threshold) there'd be enough to pay pensions for women at 65, and more for people who haven't built up huge assets, can't afford to live, heat their homes or eat a hot meal every day in their later years. I can see the (cynical) political sense in it, but no economic sense whatsoever.

AIBU?

How much do you receive per week to care for you and your child? That's what I'm referring to.

If it was "fair" then those who pay in 10 times more NI during their 35 (min) (poss up to 50ish) years of contributions should maybe get a higher pension than those who scraped in a bare minimum? But no because those who contributed most will probably have a backup of other pensions and investments too. Having a flat rate makes it heavily weighted in favour of the poorest. If we scrapped NI and everyone put the same contributions into defined-contribution pensions, the wealthiest would get way more than the flat rate pension and the poorest would get a pittance and br plunged into further poverty.

Are you forgetting that we don't all pay the same level of NI? So although the SP is a flat payout for all, some pay in loads more than others.

Why shouldn't millionaires get a full pension? They've paid loads into the system. Lower earners will be entitled to other benefits. As for earners with private pensions, they paid into schemes so took home reduced income. Why should they then have their state pension reduced?

YABU

My mum worked from 15 until in her 60s, other than a few years when me and my sister were small, paid the “big stamp” NI, private pension contributions etc, had an OKish office job she worked her way up in. Her cousin never worked and claimed benefits her whole life. My mum has ended up with £40 a week more than her cousin as the cousin gets pension credit and other stuff as well as the basic pension. Hardly seems worth it does it.

The idea of removing the state pension is batshit. And trying to introduce a means tested system would be so complicated it would cost more to adminster. Plus you would destroy the social contract behind NI.

This report published by the House of Commons library earlier this year shows how little of our GDP we spend on state pension provision.

researchbriefings.files.parliament.uk/documents/SN00290/SN00290.pdf

The UK is way down the list. The report summary says “A comparison of state pension alone shows the UK providing a lower level of pension than most other advanced economies relative to average earnings, however, the relative position of pensioners converges if income from all sources is considered.
The UK devotes a smaller percentage of its GDP to state pensions and pensioner benefits than most other advanced economies. Income from occupational and personal pensions is a relatively important source of pensioner income in the UK, in contrast to many other countries where state provision (financed either through social insurance contributions or general taxation) is dominant.”

Because millionaires don't need it?

That's the new pension, most current pensioners get slightly less but retired earlier to be fair.
It's based on the National Insurance system where you have to have enough qualifying years.
If it was means tested there wouldn't be any point in middle income workers paying into private pension schemes.
It's not a lot to live on if you get nothing else and you do pa tax on it if you have enough income to meet the tax threshold.

it Isn’t a benefit though, it’s a separate pot of money that people pay into while they work and get back when they retire.

You do realise that everyone who gets the full pension has to work for it and had paid tax?

Regardless if how well off they are they are due it.

I agree. I am happy for the country to take tax from millionaires so agree they deserve this back at the end.

And the government is desparate to encourage private pensions, to avoid paying pension credits/benefits, so it would be mad to deter people from saving in addition to paying their NI.

It's insane that people with private pensions ALSO get a government pension.

Useful data, thank you. I'll have a good look.

Not how it operates in most countries. If you have a private pension above a threshold, you don't get paid the government pension.

Then why do you think anyone would bother to take out a private pension?

Why?

Well, no it isn't a separate pot that you get back - it is a universal benefit.

Why? Why wouldn’t they get back from the pot they contributed to because they could and chose to also make private provision for themselves?

You do. And high earners are massively disincentivised/restricted from paying into a private pension due to the limits on pension contributions.

You don't get a state pension if you don't pay in. Currently its 35 years contributions for a full state pension. If you pay in less than 10 years you get nothing. What do you suggest happens to pensioners? We have to pay NI, there's no choice. By the time I get my pension I'll have paid in 50 years NI. What's so unfair about that?

Why shouldn't millionaires get a full pension?

What the actual fuck is wrong with you?

The resin for this is that statistically women live longer, but in failing health. Women are much more likely to have illness sooner, and for longer than men.

Only theoretically. In practice, peoples pensions are being paid for by those of us who are currently working.

There isnt a 'pot' sitting there being topped up by our NI payments.

Are you advocating means tested pensions? I wouldn't necessarily be against them,but you have to take into account the number of staff required to administrate that.

I'm a pensioner with a "final salary" occupational pension (few of us around theses days). So, I'm doing just fine, and I get £ 600 s month from the government, not £800 pm.

id favour means testing testing oap, if I didn't also know how much it may cost. I'd opt for paying more tax, that gets pensioners like me, but leaves others, on basic state pensions, alone.

increasing ni does not hit pensioners who are doing ok,like me. We don't pay ni.