To be angry with people who describe the old age pension as a "benefit"?

[FlubandSlub]

When I started my working life, aged 16, I entered into an agreement with the government for them to save my pension money for me. It was stated that it would be until I turned 60 which would be when I could starting drawing my old age pension. Even though I made my FULL pension payment contributions by the time I turned 51 the government has decided it will not abide by the original agreement and that it is going to keep MY money until I am 67. Probably hoping I will die before then.

Consider this, not only did I contribute to my pension, my employer did too. It totalled 15% of my income before taxes. If you averaged only £15 000 p a. over your working life, that's close to £220,500. Read that again. Did you see anywhere that the Government paid in one single penny?

We are talking about the money that I and my employer put in a Government bank to ensure that I would have a retirement pension. It was not money that the Government had any right to spend on other things! Upon reaching the age to take it back they've started to call the money we paid in a "benefit" !

If you calculate the future invested value of £2500 per year (yours & your employer's contribution) at a simple 5% interest (that's less than what the govtpays on the money that it borrows from overseas), after 49 years of working you'd have
£892,919.98.

This money was supposed to be in a securely locked box, not to be used as part of the Government's general funds.
Successive governments borrowed the money to spend on other things but that doesn't make my pension some kind of charity or handout!! If a private pension company did this we would sue them. Unfortunately the Government can legally rob us blind and get away with it

IT'S MY MONEY! IT IS NOT A BENEFIT!!

Ah, the old "If you want to go there, you wouldn't start here" comment. True and not really helpful.

Indeed those moaning that it moved to 65 and then going to 67 clearly forget that everyone younger will be having it rise again and again by the time they get to claim it so will of paid in even more for longer while they moan to and at those who will be funding it.

Tiny violins 🎻

Government will screw who they can when they can it’s nothing personal. You’re just getting less and the people after you get even less.

Does anyone know there is an agency that can advise on pensions? I’m not sure but maybe the CAB do this?

I’ve been a bit worried that I won’t qualify for a state pension as a full time mum I don’t pay NI and struggle with chronic illness so not sure if/ how I will manage to re enter taxable employment. I assume disabled people still qualify for state pension though? I kind of assumed I might get something but reading this is maybe wishful thinking 😞. Sorry to derail the thread and thanks in advance for any replies x

@FlubandSlub

I entered into an agreement with the government for them to save my pension money for me.

There was no such agreement. You didn't "sign" any contract. You basically paid the tax/nic as required by statute throughout your working life.

Governments can and do change tax and benefits rules all the time - there's no "agreement"/contract that they won't change things.

You may have "assumed" you'd get the state pension at a certain age, but that's on you for making assumptions.

The OPs post is just a copy and paste of one of those stupid right winger Facebook posts doing the rounds. Ive seen it a couple of times on various groups Im on (nothing to do with politics but plenty of very unhappy pensioners who honestly seem to believe their fund has been stolen from them). Also had the same discussion with my own DM just last week when she was moaning about it all. She seemed to have no idea that NIC were not 'saved' for her and complete lack of awareness that everyone younger than her was going to be much worse off!

It has never been supposed to be saved for you.

that’s not how it works

they’ve always been called benefits.

I think NI should be scrapped too and replaced with equivalent other taxes, but that will never happen - can you imagine any current or prospective government trying to explain the change, even if it resulted in people paying the same overall? They'd be up in arms about a basic tax rate of 30%+!

Whilst as others have pointed out your overall assessment of the situation re NI contributions is incorrect, there is a an area which is true. SERPS was an area you could opt out of paying and reduce the NI paid or have those funds diverted into a private pension. People made decisions based on the facts given and anyone who opted to keep money in SERPS has been screwed over.

Those who reduced their NI paid less and may now have to continue contributing for more than 35 years for a full new state pension, those who diverted it to a private pension have the benefit of those additional funds in their private pension but may need to contribute NI for more than 35 years. The people who remained in SERPS have had that money stollen - reducing the number of years needed for a full new state pension benefits very few people as most work and pay in for longer than the 35 years now required. It was an earnings related scheme which has been exchanged for a higher new state pension for everyone, regardless of how much an individual contributed to SERPS.

For those on the old state pension some people are getting hundreds of pounds a week in SERPS payments. Those of an age who fall under the new state pension will never have the benefit of those SERPS funds, just a very small amount more in the new vs old state pension. It’s a 2 tier cliff edge system which may well be repeated by means testing state pension in the not too distant future.

The pensions that aren't a benefit are the one you earn with a company pension or a SIPP. State pension is an old age benefit. Our tax and NI pays for today's pensioners. The system works if we have new workers to replace those retiring.

but it is a benefit? OK you have to make a certain amount of NI contributions to receive it in full but it is still a benefit. The money hasn’t been put away with your name on it. It’s been put into the tax pot and used to pay the pensions of the pensioners of the day (amongst other things). When you’re 67 it won’t be your money you’re getting back but the taxation raised by the workers of that time.

How charming. I receive the state pension. I’m also a taxpayer and no, I’m not robbing people blind. I’m eligible for a state pension therefore I receive one. It isn’t pensioners fault that younger people are too lazy to get off their arses to get to their local polling station. Rather than being bitter about state pension recipients why don’t you lobby those non-voters?

And while I’m here, I am child free so haven’t received maternity care nor child benefit nor childcare funding courtesy of the taxpayer. Neither have I any children who have benefitted from free education and healthcare, again courtesy of the taxpayer. And before you ask, I pay for my own healthcare and my parents paid for my private education. All in all I have cost the state very little while contributing a not inconsiderable amount over my forty-eight years of full-time employment.

I would say it is a benefit - just not a means tested benefit in the strict sense of the phrase.

Why do they offer people the chance to top up their NI credits online if this is not going towards a pension? Surely that's misleading? What are the top up's paying towards if not a future state pension?

This is one reason why it is vital to ensure you are claiming what you are entitled to. I can only speak about ESA and Carers Allowance, but they are engineered so that when you are claiming them, your NI is paid.

Even if you don't "need" to claim ESA or UC (because you wouldn't get anything) it's still worth it to ensure that NI is recorded correctly.

Just to add onto the Chritsmas bonus £120 million a PP mentioned, it's worth all posters that can read to note that last year £22 billion went unclaimed in benefits.

£22 billion. In one year.

Now go away and think what you have done 😀

Nail on the head. Huge numbers of people have paid little, if any, NIC, yet entitled to a full state pension. Such as those who've had "credits" due to unemployment, disability, caring responsibilities etc., and "part timers" who've earned at a level over the lower NIC threshold to gain "credits" but under the level at which NICs are paid. Not to mention part timers etc who've paid literally just a few pounds in NIC but still entitled to full state pension. There is no longer any link between NICs paid and state pension - nowadays it's all about earning "credits". Of course, lots of people have "played the system" to get full state pension without paying any NIC. NIce if you can do it! For such people, it's definitely a BENEFIT!

NI contributions do not only go towards the paying for the state pension! They are used to pay for all sorts of benefits including statutory maternity pay, statutory paternity pay, statutory sick pay etc.

I'd love for the OP to share the contract/legal agreement/any sort of written confirmation they signed up to when they were 16 about this special locked box where the government was going to save their money.

It's probably kept next to the special contracts signed by the "Freeman of the Land" loons setting up their fictional legal identities.

Weirdly I always smelled a rat about "contracting out of SERPS". Based on the nasty sales people that were selling it.

Not far off before I see if I made a mistake or not.

There should be a cross party group to review the whole pension model. It should have happened years ago but successive governments have failed to address the issue.

Of course some pensioners want benefits means tested for others ....

You sound like my FIL who frequently tells us he should be entitled to free everything because he has full stamp.

It’s been explained several times in simple enough terms.

What does it say on the website where you can top up NI credits ?

Sadly, there is only one solution I can think of, what about you?

You know the government doesn’t pay a penny towards universal credit or disability benefits either? Because the government doesn’t have any money, it just collects and redistributes taxpayer money. So you can’t say the government didn’t contribute to your pension so it can’t be a benefit, as in that case nothing is a benefit.

I agree. Yes technically the NIC pays for current contributions but access to a payment based on qualifying years with some us making top-up payments to ensure we get the full entitlement.

So comparing it to other benefits is flawed.