Tories and Labour mooting possible means testing of State Pension

[Turmerictolly]

www.theguardian.com/politics/2025/jan/17/kemi-badenoch-pensions-triple-lock-means-test-alarm-tories

I would be so gutted if this happened but there's noise from both parties about this recently. I think it might be inevitable. What will happen to those of us nearing 60 who have made plans that include the full state pension we've paid contributions for?

As a society we have this fixed mindset that £50 = a high salary and £100k = megabucks. It may have been true decades ago but those psychological thresholds haven't budged.

With increases in the NMW, it won't be long until a couple each working full time on the NMW will have a gross household income of over £50k. Nothing wrong with that but we can't then say that a single earner household on just above that salary should be paying higher rate tax!

And in April, two people earning minimum wage will be just above the 50 k @ 50.8 k! It’s crzy

The second biggest welfare cost after pensions is housing benefit. Building more council housing and having rebut controls would be part of the solution to reducing welfare costs. As a bonus, it would be more worthwhile to work if housing costs are reduced.

They seemed to be talking about doing it 20 years in the future. To give people time to prepare. It won’t affect anyone near or at pension age now. 🙂

I hope you're right @Boomer55 but look what happened with the waspi women and with the fairly sudden withdrawal of the winter fuel payment. I'm hoping we can trust Labour to be more measured about any changes (maybe this is misguided) but I wouldn't trust the Tories on this.

I hadn't realized it was as soon as this year! And yet you see on MN all the time people begrudging couples with a £100k household income their child benefit, tax-free childcare etc 🙄

The police and fire service don't pay badly at all, and have a retirement age early enough to allow them to pursue an additional pre-retirement career, so I'm not sure they're a good example of low-paid service workers.

I dont think 20 years is that long to prepare. That would be around the time I would expect to retire, so it would mean I need to make up an extra 300k in my pension pot in 20 years to be in the same position I expected to be. That seems a huge sum when the last 20 years havent reached that amount.

I know it depends on the means testing method but I am also suspicious it would be middle people who will lose out somehow..

Any means testing would likely affect those with Public sector pensions so that would be a hurdle to overcome, I doubt they would agree quietly

I also don't think twenty years is adequate - thirty at a push, perhaps.

We are undergoing a pension consultation at work at the moment - and it's surprising (or not) how little knowledge people had about pensions, what they had and the different options out there.

There's lots that I don't know - but the lack of knowledge about what type of pension they had, how it works and other options was a bit depressing - as they do have to make some pension decisions soon.

I agree, I think financial planning and pensions should be taught in schools.

Problem tho is teachers have a DB pension - fine, comes with the job - but also means they don’t really need to know about investing. Also I think eventually someone would try to sue their local authority over advising them poorly and how long before some parents were complaining about not telling the kids to invest every penny into crypto or whatever the next get rich quick scheme is.

So I’m not sure it’s practical. But we really need to drill into people to start paying into a pension as early as possible.

Also the biggest cost to individuals/ families is mortgage/ rent. Build more houses = increased supply = lower house prices = lower rents/ mortgages.

With reduced costs from rent / mortgages individuals can then afford to pay more into either their pensions, invest it or just spend and boost the economy.

I’m not sure this is true. New houses will still be sold at very high prices because that’s the market rate. Also who is going to build houses if they’re not going to make profit selling them?

Rent you might have a point about but again only to a limited extent. Private landlords are being forced out of the market by various government rule changes so the future looks like build to rent with professional landlords but again they’re only going to build properties if there’s a profit in it for them.

And I think pension planning being seen as something you can focus on is a recipe for disaster. It should be a priority as early as possible because the sooner you start the easier it it to acquire pension wealth due to compounding.

I say this as someone who didn’t focus on pensions till far later than I should have who now regrets that.

With increases in the NMW, it won't be long until a couple each working full time on the NMW will have a gross household income of over £50k. Nothing wrong with that but we can't then say that a single earner household on just above that salary should be paying higher rate tax!

the tax bands need to move & inflation has devalued money. 70k today is probably 50k 4/5 yrs ago.

@Miley1967 Yes there are some pensioners that are really struggling - they are disabled but are not able to rely on the unpaid caring of family members (which saves the state a fortune). Instead they have a small uprise in benefits which in no way enables them to buy the care a family member claiming CA would provide. The shopping, housework, lifts to hospital etc. even just the companionship and someone to take them out for a coffee. Some of them even have to face the uncertainty of renting whilst old, disabled and alone.

But you chose to post that they are raking it in as if they are living the life of Riley when I suspect they are barely surviving.

Why don't you focus on wealthy pensioners with asset wealth and personal pensions who own their home mortgage free, have gifted deposits to their DC, can afford to buy a new car every couple of years, take multiple foreign holidays each year and can afford to lunch out multiple times a week BUT are also receiving SP and AA because it is not means tested?

Means testing would not negatively impact on their lifestyle. But they may be pissed off to not get free money they don't need.

BULLSHIT There are plenty of pensioners who were low paid workers who are on Pension Credit. The ones who served you in the supermarket or who cared for your grandparents or even great grandparents in the care home. YOU are deliberately trying to stigmatize them. No wonder Gen Z are saying no to some of these jobs They have seen previous generations get no thanks for it and treated like they have never worked.

People live in social housing because they arent in a position to buy
The cognitive dissonance is off the charts here,

True - but you can be in social housing and eventually be in a position to buy but you don't have to buy.

However - owning a house does give you more options, especially with passing wealth down the generations.

It does raise some interesting questions though.

Certainly looks that way

https://www.mumsnet.com/talk/_chat/5232785-universal-credit-mixed-age-couples

https://www.mumsnet.com/talk/_chat/5239387-universal-credit-pensioner?page=1

Badenoch's proposal is to means test the triple lock - surely that's different to being means tested for the actual state pension isn't it?

What does ‘means test the triple lock’ mean? The triple lock is the way the rise in pensions for everyone is calculated. How can you means test that? I mean, Badenoch may have said it but she’s a liar who understands little outside her immediate sphere and doesn’t think before she speaks….

I don't think that's her proposal

www.telegraph.co.uk/politics/2025/01/17/means-test-pension-triple-lock-badenoch-report-fake-news/ www.telegraph.co.uk/politics/2025/01/17/means-test-pension-triple-lock-badenoch-report-fake-news/]]]]

1.The State.....................dont drink dont smoke keep your weight down work full time excersise protect the NHS.
.2 Also The State ...............run yourself ragged caring for elderly relatives. --and we will force you to do so by sneakily sending your relative home in an ambulance at 3am whether anyone is home or not , whether you have to work or not while also still expecting everything of you written in no 1

If sending a link, please could you also send a share token?