Who’s going to pay our pensions in 20-30years if the UK keeps its birth rate low and also restricts immigration?

[AlertEagle]

posted from another forum
Serious question. The UK’s birth rate is well below replacement level, meaning fewer young people entering the workforce. At the same time, the political mood seems pretty anti-immigration, even though immigration is one of the only things that’s kept the tax base stable.

State pensions are paid by current workers’ National Insurance contributions, not some magic fund. So… what happens when there’s a huge retired population and not enough working-age people to support them?

Will the government raise taxes, increase the retirement age, cut pensions, or eventually U-turn on immigration just to prop things up?

Feels like a ticking time bomb no one’s really addressing. Curious what others think, is anyone actually planning for this?

Or are we as a nation willing to give up state pensions if it means less immigration?

https://migrationobservatory.ox.ac.uk/resources/briefings/the-fiscal-impact-of-immigration-in-the-uk/

There is a big difference between high and medium waged migrants and low/no waged migrants.

Obviously it makes sense to keep the former two and limit the numbers in the bottom category. Criminality is also much higher among low/no waged migrants.

Why do some commentators insist on conflating the different groups?

If I receive any inheritance from my dad it will be going straight to my kids. We ( dh and I ) don't need it.

I’m making sure to pay as much as I can in to my NHS pension

The future does look pretty bleak. Sometimes when I am out and about, I see little children playing so freely and happily and I just think to myself, you have no idea of the difficulties and burdens which lie ahead for you. 😔

The 65 pension age for men was set in the 1940's and has only recently started to creep up to 68 in the last few years. Life expectancy has increased by considerably more than 3 years since the 1940's. If we are being realistic, the pension age should have gone up a long time ago and, if we're being really fair, the pension age for women should be slightly higher than for men as we can expect to live 3 or 4 years longer.

We have one if the lowest state pensions in Europe. We are one of the richest countries in the world. The problem is lack of political will. The richest 50 billionaire families in this country have the same wealth approximately as all the poorest 50%. If we taxed the richest e.g. 2% of their wealth they wouldn't even notice. Nor would they immediately leave. They like their lifestyle here. Compare China where e.g. despite having a much lower per capita income most women retire at 55. Only managers retire at 60.

It's a conundrum, as a consumer economy will eventually collapse if dwindling numbers have any spare money. A Universal basic income on a country by country basis according to the cost of living essentials created as a form of "Monopoly Money" that would operate alongside the "real" economy?

Raising the state pension age to an unreasonable age will make no difference to people’s age related illnesses. There will simply be more people on other welfare benefits.

Exactly!

Auto opt in for pensions was a good start, but we need to make it compulsory. No one should be able to opt out. People simply can't expect to pay nothing outside of taxation and be retired for 20+ years.

@HoskinsChoice healthy life expectancy matters!!!

No one should be able to opt out.

I see young teachers opting out of the amazing TPS because after rent/saving for a house deposit they don't have enough left. We need to address housing costs.

People simply can't expect to pay nothing outside of taxation and be retired for 20+ years.

And yet this is the current system

Including the self employed although how that can be forced I have no idea

We have one if the lowest state pensions in Europe. We are one of the richest countries in the world.

Our state pension is low but when you add in private pensions pensioners are in line with Europe. We have low gdp per capita due to inequality.

There are a growing number of young people who don't think a pension is necessary so they don't pay into one.
People from Pakistan and Bangladesh backgrounds are not paying into pensions. Only one in four from Muslim backgrounds in the UK is contributing to a pension.
I think they are relying on the state providing top ups via pension credits so there is no need for them to invest in a pension.
https://www.bbc.co.uk/news/articles/c05631v11ndo

I spent forty years building up my pension. A friend who hasn't worked since having her kids benefits from pension credits. It is a bit of a slap in the face for all of us who believe we have to provide for our old age when many think the state will do it. At the moment, it will.

Keeping immigration to net tax paying households would reduce immigration and boost tax coffers. Make education tax free again and encourage parents to explore independent education to reduce state education costs massively (especially around SEN). Introduce a national health system similar to Germanys and save an absolute FORTUNE on the NHS. Move the the income tax bands inline with where they would be if not frozen ( e.g. 80k for 40% ) and remove the loss of tax free allowance at 100k to encourage British people to have more children.

But surely your 40 years of pension contributions will give you more money than she’ll get? I’d rather be in your financial position.

We couldn’t really incentivise it anymore without literally paying people to save. You pay no tax at all on money saved into a pension and it adjusts your income for things like tax free childcare and free hours. It’s massively beneficial.

How would inequality cause low GDP per capita? It’s not weighted in any way, it’s literally per capita.

and remove the loss of tax free allowance at 100k to encourage British people to have more children.'

Even with financial incentives I don't believe any country has increased birth rates.

@ThatBoldBear apologies that should say productivity not inequality.

low productivity

They should have left it out of inheritance tax, it’s made me rethink my planning a bit.

Ah yes, completely agree.