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!!

Errr ok.

No it wasn’t. The 1908 Old Age Pensions Act described the state pension as a benefit, which was means tested according to income and funded from general taxation. Then came the 1925 Widows, Orphans and Old Age Contributory Pensions Act, which introduced contributory pensions for the first time, described as a contributory benefit funded by contributions from employers, employees, and the state.

The 1946 National Insurance Act superseded both of these acts and still legally defines the UK state pension as a contributory benefit so as to fit within the defined framework of National Insurance.

I think it would be more likely they stop the pension but keep pension credit. That way the government is means testing who they help in retirement. I do find it crazy that millionaires still get a state pension.

What is it?

”As long as you have paid the qualifying years…”

you can see why people don’t see this as a benefit in the same vein as jobseekers or housing benefit.

I am coming up to state pension age and I consider the state pension to be a benefit .
My reasoning is that it is something I am entitled to under the current rules, in a set of prescribed circumstances , the same as if I was unemployed or in receipt of a disability benefit.

I have not entered into any binding agreement and I have not been saving into my own " pot " .
The fact we do not save into individual pots is broadly beneficial to most people , who will take out more than they ever contribute .

There are entire industries that rely on that.

This is where there will be big problems.

Right now as it stands you would qualify for pension credit if you didn’t qualify for a full state pension. You would get similar money but also get free prescriptions and other benefits. Which can actually make you better off than people who are only on state pension.

So. In the future. If they scrap the state pension for those who have worked and paid tax but still give a “pension” for those who did not work, how is that fair? People keep saying pensioners will just have to “work until they drop”. But you’ll just get loads of 70+ year olds going on the “disability” pension. Despite everyone on here apparently knowing marathon running mountain climbing 80 years olds the fact is most people once they hit 70 are going to have health issues. So are they going to say that if you have been disabled all your life or from a young age you still get money over 70 but those who became ill/disabled at 71 will not?

My job is slowly crippling me. I have a compressed spine and sciatica. I still have 25+ years of working left. I could go and look for another job once I’m too crippled to stay in this career. But who is going to employ me at 65 when I can hardly walk? So should I not be allowed a pension but you can have one because you’ve been unlucky enough to be disabled young?

Ps not blaming you here. The “you” I’m talking about is just similar cases to yours. You should definitely be entitled to a “pension” of sorts in my opinion. But once I can no longer work, whether that’s due to age or health, I should also get a pension.

Go join (or start) a political party and get campaigning then!

thanks @anytipswelcome that sounds a reasonable explanation of how the Government Pension scheme works. I haven't ever really thought much about it until recently and have wondered why I still pay NI after getting to my full 'stamp' as they used to call it. Every day is a school day!

Of course the state pension is a benefit. My mum has drawn more government state pension than the actual money she ever earned in her life.

She has more pension (with late father's pension) than she can actually spend. It's mounting up in her current account. And she has the cheek to spit feathers over the winter fuel allowance being cancelled, like she ever earned it.

It needs to be means tested, like other benefits and possibly made smaller.

And the OP has merely copied and pasted some guff that's been doing the rounds on Facebook (Boomer platform du jour) for a couple of years.

You are incorrect.

The money you paid in paid for the pensions of the pensioners who came before you.

Other state benefits are subject to taxation and work on exactly the same principle as the state pension in that they are paid from the national insurance fund, which is ring fenced for the payment of state benefits and some NHS funding. Eligibility for some benefits depends on the last two years NI contributions but some disability benefits such as PIP and also means tested benefits such as UC are not conditional on NI contributions because they are based on need rather than contributions.

If your proposal to increase contributory periods to fifteen years for such benefits was enforced it would defeat their purpose and there would be a lot of people homeless and starving on the streets of the UK because you’re essentially removing the basic safety net which is part of the rights and responsibilities social contract. And some state benefits are taxable - contribution based benefits such as new style employment and support allowance, carers allowance, and child benefit, subject to income thresholds are among taxable benefits - these benefits are generally below the tax threshold and only become taxable where there is other income. Taxing UC and unemployment benefits for the sake of it would be pointless and expensive as there is no mechanism to collect tax directly.

So. In the future. If they scrap the state pension for those who have worked and paid tax but still give a “pension” for those who did not work, how is that fair?

How about someone who has been unable to work since age 17 ? Why should they get a penny ?

From the GOV.UK website;

Gaps can mean you will not have enough years of National Insurance contributions to either:

• get a State Pension (you usually need at least 10 ‘qualifying years’)
• qualify for certain benefits

You may be able to pay voluntary contributions to fill any gaps and top up your State Pension.

and;

What National Insurance is for
National Insurance contributions count towards the benefits and pensions in the table.

Basic State Pension
Class 1: employees Yes
Class 2: self-employed Yes
Class 3 : voluntary contributions Yes

The government call it a benefit, not just "people". Its been called that for a long time. Check your correspondence from them.

If state pension is a benefit it should be a benefit for all workers (rich or poor). If you haven't worked you shouldn't benefit from.the pension benefit. Simple!!

So what was your question ? Seems straightforward enough.

(Again)

The ballot box is that way --->

So are they going to say that if you have been disabled all your life or from a young age you still get money over 70 but those who became ill/disabled at 71 will not?

Not all benefits are conditional on paying national insurance, so if you are ill or disabled and cannot work, you will be entitled to means tested benefit - the sickness element of UC for example. And you will automatically be credited with NI contributions to protect your eligibility for state pension etc, for as long as you are claiming that benefit.

And you don’t need to be on pension credit for free prescriptions. Everyone gets free prescriptions if they are under 16, aged 16-18 and in full time education or aged 60 or over.

Why not ? The current system of benefits in the UK means that certain mainstream benefits attract national insurance contributions to protect eligibility for state pension. People may not have worked for a variety of reasons - illness and disability being just two. Why would you punish people like that for something beyond their control ? And if state pension is a benefit like any other why would you set it aside from universal eligibility?

There are contributory and non-contributory benefits. The pension isn’t the only contributory benefit

@FlubandSlub- was this a deliberate “wind up the middle aged people against the pensioners” thread ?

Interesting question. The government website states you are ‘able to pay voluntary Class 3 contributions to fill gaps in your NI record
to qualify for the State Pension’. This has only been available since the new state pension was introduced in 2016. However, this money you are volunteering is not connected to your income and indeed may have already had both income tax and NI paid on it (from savings maybe, or gifted). I’m unsure what the wording of the legislation for state pension is, but presumably it mentions somewhere it is connected to income and/or credits (for child care etc). So I wonder if younger people, who might have paid for missing years, who may be told that they will either be not entitled, or means tested or whatever other change happens to the SP in future, may have a case to say the Government had entered in to a contract with them by reason of taking their money that was neither connected to their income or NI credits? I’m sure someone will try that at some point in the future if changes are made.
(Disclaimer obviously is that the government also clearly state that pension forecast is in way guaranteed.)