to believe Rachel Reeves was crying because

[LargeDeviation]

1. she was upset when Lindsay Hoyle told her to keep her answers short

2. she had an argument with Keir Starmer (possibly about her keeping her job, or about how to handle the inevitable questions about the new £5.5bn per annum black hole) just before PMQs

3. Keir Starmer refused to say she would keep her job in front of the whole country. If he genuinely wanted her to stay, he would just say 'of course she's going to still be Chancellor' and that would be that.

4. she is under immense pressure because she knows she will have soon to breach her fiscal rules, she knows she is responsible for many of the decisions that will lead to that, and she knows the how serious the consequences of her failure will be. We have seen recently (even just today) how vicious the bond market can be.

In short, I believe she was crying because of professional pressures (understandable ones, though largely of her own making, and about which I have little sympathy) and not nebulous 'personal' reasons.

If her parent or partner or child or grandparent or pet is ill the natural thing is to just say 'sorry, a close relative is in hospital and my emotions got the better of me'. Everybody would understand. You don't need huge reams of evidence but you need to give the bare bones of an explanation. She is trying to style it out but we can all see through it.

I will apologise if I'm wrong but long experience shows that 'personal reasons' almost always means 'I'm skiving or jobhunting' when a colleague in the workplace uses it to excuse their time off.

I believe it means even less when uttered by a politican.

you either cut, borrow or raise taxes. Can’t borrow, said they wouldn’t raise taxes so they tried cutting but their childish MPs fought against it. It’s as though they want to implode the country’s finances.

That would be an awful loss making investment. If that is implemented, I strongly recommend you don't invest.

You and the Treasury would probably be better off investing in an S&P500 and gifting the Treasury some of the profits each year.

@ThisOldThang - at the moment, there are loads of Middle Eastern banks offering a good interest rate online for savings products, off the back of the UK Government guarantee for bank accounts. Now yes, I do pay tax on the profit, but it is the UK Government that should be having a scheme offering a guaranteed and tax free rate instead and could tap into much cheaper cost of borrowing. It would need to be a long term fixed product though, we cannot deal with the volatility of the gilt market. I would rather give them a guaranteed 3% five year loan than support a Middle Eastern bank and pay tax. I cannot be the only one.

It is the volatility in the gilt market and the way they did the quantitative easing as compared to other countries that seems to be the problem. But I am not an economist, however, do remember reading some quite meaty analysis from experts on ways to mitigate the effects. Sunak had warned of this and it is becoming an ever more urgent issue to sort out. There must be solutions. The trouble is they always go straight to the taxpayer as they see that as an easy fix but I think we are now in negative productivity territory and they are just going to have to come up with more sophisticated solutions.

Of the list in the pp’s helpful email, I would tackle public sector pension liabilities first. Trillions of unfunded liabilities that have been kept off the balance sheet, and which no gov has ever included in pay negotiations (resident doctors being a current example).

As things currently stand, DH will receive about £80k per year for life in about 10 years, ie 50% of current salary. He’s never even had so much as an ingrown toenail, so that could be a long time. This includes some entitlement under the “old” pension scheme, but it’s clear the reforms did not go far enough. I dread to think what kind of pot would be required to purchase an equivalent annuity, but it’s plainly unaffordable to everyone except perhaps the CEO of a FTSE 100 company. Very nice for our family, but obscene in the context of the UK apparently starting its long, cap-in-hand, trek to the IMF.

If he's retiring at 65 that would cost around £1.8 million.

But i think private pensions are only linked to RPI for a short period, rather than until death.

That sounds about right @ThisOldThang . So multiply that £1.8m-odd by around 55,000 NHS consultants. I focus on consultants because they tend to be the highest paid, but the same basic pension entitlement is also enjoyed by 1.6 million NHS/GP employees.

I am sure there are other examples of generous public sector schemes, but the NHS is the one I am most familiar with (largely because it will comfortably fund my retirement as well as DH’s!) My own private scheme has pretty pathetic returns, relatively speaking.

Think of all the tax he’ll pay on that £80k. It will all be taxed too as his personal allowance will all be taken up by the state pension. He’ll be losing 40% of a fair proportion of that.

Sir Keir Starmer has refused to rule out introducing a wealth tax.
Kemi Badenoch demanded a cast iron guarantee from the Prime Minister that he would not launch an autumn Budget raid on wealth, but he was unable to give one.

The Tory leader said Sir Keir was “flirting with Neil Kinnock’s demand for a wealth tax” after the Labour peer commented on the issue on Sunday.
The leader of the Conservative Party said during PMQs: “Let’s be honest about what that means. This is a tax on all of our constituents’ savings, on their houses, on their pensions, it would be a tax on aspiration.

“Will the Prime Minister rule this out?”

Sir Keir replied: “We will not be asking for their advice. What we did in the Budget was stabilise the economy through the measures taken by the Chancellor and what has that led to? Four interest rate cuts. For mortgage holders that is hugely important.”

Here we go….

Ridiculous answers. No wonder most think they’re doing a bad job. Painful to hear jeering and non responses every time.

My sincere hope is that something happens soon - be it outsized market volatility, or a political crisis, that pressures Starmer to react quickly, rather than the current death by a thousand cuts (no, not those cuts unfortunately).

There is no confidence in the UK, not in its government, not in its economy, increasingly not in its judiciary.

Let the entire edifice fall asap, so people can see that LABOUR DOES NOT WORK.

More to the point, how many people’s tax went only to fund all those millions of multi-million NHS pots, before a single child was educated or pothole fixed? How many of those people are working FT yet earning less than DH will receive after retirement? The amounts at stake are boggling, and as I wrote, the NHS is just one example. Too many snouts in the trough wanting to kick the can further down the road, I suspect.

Judges have an insanely good deal.

https://www.telegraph.co.uk/money/pensions/gold-plated-pensions-cost-taxpayers-400m-year/

Taxpayers are spending more than £400m a year on gold-plated pensions for just 10,600 judges, new analysis shows.

The average member of the Judicial Pension Scheme now receives £37,000 in pension contributions for each year of work, before being handed almost £40,000 a year in retirement.

They have built up £4.5bn in taxpayer-funded pension entitlements, but pay up to 7pc towards the cost of their retirements.

The figures come despite major reforms to public sector pensions in 2015 after rising costs pushed the Government to act.

The Taxpayers’ Alliance said judges should be moved into defined contribution schemes, while the Intergenerational Foundation said the “profligate pension promises” would be funded by young people.

There were 10,578 members of the Judicial Pension Scheme at the end of 2023-24, according to a Freedom of Information request made by The Telegraph.

Judicial salaries ranged from £106,563 to £312,510 during the year, according to the Ministry of Justice. As public sector workers, they are entitled to guaranteed, inflation-linked pensions for life.

The scheme’s 6,162 working judges paid in 4.1pc of their salary on average. As their employer, the Ministry of Justice then added another 51.1pc at a cost of £229m.

The required employer contribution increased to 62.6pc from April last year to keep pace with the rising costs of the scheme, but the amount paid in by employees has remained the same.

Before 2012, judges did not have to contribute to their personal pensions and only paid towards benefits for their dependants.

The scheme’s pension payouts are also more generous than other key public sector schemes, with retirees receiving £39,400 on average – costing taxpayers another £180m a year, taking the total bill to £409m.

By comparison, the average pension was around £16,600 for teachers and £12,300 for Armed Forces personnel, falling to £11,400 for NHS workers and £9,900 for retired civil servants.

Liz Emerson, of the Intergenerational Foundation, said: “Younger generations can only dream of similar pensions, but they will end up paying for these profligate promises via higher taxation, later retirements and lower pensions themselves.

“At the very least, the Government should levy National Insurance contributions on annual pensions that are higher than the average earnings of working-age adults.”

Public sector pensions already cost the UK £54.3bn a year, despite being moved away from final salary schemes in 2015 amid fears they had become unaffordable.

Payments are now based on a worker’s average earnings, but the final salary entitlement for existing members was extended to 2022 after a legal challenge from members of the judicial and firefighters’ pension schemes.

Under the new system, judges have 2.5pc of their salary added to their pension each year, which is more than teachers, civil servants, NHS workers and Armed Forces personnel.

John O’Connell, of the TaxPayers’ Alliance, said: “Public sector pensions are extraordinarily generous with employer contributions, often outstripping those in the private sector.

“But what makes them particularly generous is the fact that they are gold-plated schemes, not based on the value of a pension pot, but on the average earnings of the employee, meaning they get topped up above and beyond what has already been contributed.

“On top of this, they are unfunded, coming not from an investment scheme, but general taxation. At the very least, ministers should be moving all public sector workers onto fully-funded, defined contribution schemes which are based on monies actually paid in.”

A report published last year by the University College London Judicial Institute revealed that more than one in three judges planned to quit the profession within five years, citing poor working conditions and a continual loss of net earnings amid a backlog in the country’s courts.

The Senior Salaries Review body recommended a 4.75pc pay rise for members of the judiciary for 2025-26, but the Lord Chancellor reduced it to 4pc.

A Ministry of Justice spokesman said: “The Judicial Pension Scheme 2022 is designed to encourage top legal professionals to become judges who are vital to keeping the justice system running.”

I think they should rip up and rewrite the tax laws. Closing loopholes and making giant global companies pay the proper taxes.
The whole mess with ai is because they've put so much cash into ai companies that they must now force us all to think it's the holy grail as it takes jobs.
Everyone must work but in what?
There is also a whole lot of cash shoved into consultantcies, I would do that job for a 1/4 of the price and still earn more than I ever have.

There is a huge, unwieldy amount of tax law. Agree that it’s too complex but rewriting it from scratch would take a decade or more.

And global corporations are mobile. They can choose where to set up permanent establishments and will do so where tax conditions are favorable to maximise shareholder profits. If you think a company is not paying the required amount to HMRC under the current regime, then report it. The chances are it is already compliant, but the amount raised is low relative to their UK presence because they are (lawfully) minimising their exposure to our punitive tax rates.

The EU Single Market allows companies to pay money through the Netherlands as 'intellectual property royalties'. The Dutch have a zero percent tax in that area. Closing the loophole would require unanimous agreement in the EU and the Dutch won't agree because they have so many very well paid accountancy and legal jobs that are dependent upon it. Those workers pay a huge amount of tax.

Starbucks and other companies use that loophole to avoid paying tax. Starbucks UK pay shuge royalty payments to Starbucks Netherlands for the use of the Starbucks brand. That reduces their profits to zero and therefore their tax bill to zero.

We'd need a full no-deal Brexit to do anything about it.

Is there any way there could be a voluntary tax scheme where companies paying well below a fair amount are more publicised and there is more public pressure on them to pay in an amount that would be affordable. It doesn't sound like there's any real prospect of changing the rules to make them fair to the non rich. But public pressure can do great things. Sometimes. Companies have already changed their behaviour in some aspects for image purposes eg equality schemes and environmental programmes, even if it's greenwashing in many cases sometimes it's not and it may be better than nothing.

Anyone can pay as much voluntary tax as they like at any time! Just gift it to HMRC. 🤷🏻‍♀️

The obvious and complete response to “you don’t pay enough tax” is “we pay everything that is legally required”. You can’t judge what is “fair” unless you look at the whole group’s structure, location(s) and P&L’s (and probably not even then, unless you’re a tax accountant).

Directors are legally required (on pain of some fairly onerous consequences) to act in the best interests of the company, not the Exchequers of the multiple markets in which that company does business (which are often adverse to the interests of the shareholders).

Most decent corporates already make significant contributions to charitable and community initiatives.

But Starbucks pays no tax apparently. Obviously if these questions are put to them every now and again by a polite well mannered journalist they're not under any real pressure but if real pressure could be brought to bear maybe something could be achieved?

How many people’s lives were saved or improved by your husband’s work? Fuck potholes, lives are more important.

Well fucktonnes, obviously, but what’s that got to do with whether the UK can afford the largesse of a £2 million pension pot per NHS doctor? I’m not proposing indentured slavery, just a reasonable DC pension (such as those enjoyed by all the taxpayers funding it) for NHS staff.

Anyway, it’s a nice problem to have (selfishly) but obviously public sector pensions are wildly off-market compared to everybody else’s.

@Vinvertebrate
If you're seriously feeling terrible about the amount your husband and, by extension, you will receive as an occupational pension, why not consider asking him to give it up? Would that work out well? Do you both have enough income from investments to maintain a high quality of life after retirement? Is there no risk of regret, resentment, or bitterness from making poor decisions?

The occupational pension is a great benefit, and it's one of the main reasons people stay working in the NHS. Giving it up is complete madness unless other investments in life are just as good to make it worthwhile.

It's also worth noting that giving up the pension won't genuinely help the NHS. The NHS's issues won't be resolved by employees making a collective and irrational decision to sacrifice their pensions in an attempt to save it.

I’m not feeling terrible @ThisTicklishFatball - I’m actually feeling pretty chipper about it. (Post-retirement, DH will likely continue with his private practice in the UK while I spend 6 months a year abroad, maybe in the Gulf - we’ve had some lovely holidays in Oman). And even if I were feeling terrible, it’s not mine to give up.

FWIW my DC pension is bog-standard and whilst I am a high earner contributing 10% matched by my employer, the annuity value is a shade over a quarter of DH’s. Part of the problem is that many recipients of DB/final salary pensions don’t fully realise how much they cost, the implications of them being unfunded, what “gold-played” actually means or the value of the annuity they could purchase privately with similar salary sacrifice.

Yes we could manage without DH’s pension, having done as much as we lawfully could to avoid paying tax at AR on DH’s private income.

I appreciate that we are fortunate, but also recognize (because adult) that the UK cannot continue accruing ever more trillions in unfunded pension liabilities whilst keeping the IMF wolf from the door. It doesn’t matter how much NHS employees protest, unfortunately - we simply cannot afford all the nice things we would like. The optics of UK taxpayers - on their relatively poor salaries, who cannot even access NHS healthcare easily and enjoy some of the worst health outcomes of any developed country - being taxed to the hilt so that consultants already on 6-figure salaries can retire in the lap of luxury, is a bit too Orwellian for me. And I’m not exactly a card-carrying socialist.

Surely domestic law is what needs to change to fully end this practice? (If that’s even the right strategy)

No doubt but that will be true of plenty of less well paid roles too, including in medicine. Nurses, paramedics, radiographers, cleaners, porters, phlebotomists… all of them necessary to save and improve those lives. We can’t promise gold plated retirements to every individual who did good work though. Good public services should be available which would reduce reliance on individual purchasing power and the need for big pensions for some jobs. It’s unpopular but pensions could be a good place to start.