I’ve easily found £30bn of savings, so why can’t the government do this?

[OwnGravityField]

How about this state pension adjustment proposal?

Currently, the state pension system pays the same to everyone, even to households with very large private pensions and investment incomes. Much of this money ends up funding luxuries.

The proposal is simple:
*full SP for everyone who depends on it (60% of pensioners)
*households with more than £12,000 a year from private pensions, work, or investments have 50p of SP withdrawn for every £1 above that level, up to the value of the pension itself
*A quarter of pensioners would only have a modest reduction, and only the wealthiest 15% would no longer receive a publicly funded pension they do not need.

I used chatGPT to do the calculations.

Savings? THIRTY BILLION A YEAR

That’s 1% of GDP

List of things that could improve?

restored trust between generations so young taxpayers see their money spent on genuine need, not luxury.

national renewal: homes, NHS, lower childcare costs, investment in schools, training, the police force. It could be used to help families who are struggling with mortgage costs.

re-directing spending from low-value consumption (luxuries, imports) to investment (homes, healthcare, infrastructure) improves living standards

Positive effect on the bond markets, sterling value, credit-rating agencies, inflation trends, reduction in government debt - the UK really really needs this right now

I’d absolutely get up off my bum and vote for a party that proposed this. Would you?

And the government would just bring that in overnight would it? Presumably not, so you’d get literally hundreds or thousands of doctors / teachers take early retirement so that they still got the state pension….

No so I’ve paid in all my life and potentially get nothing.
No thanks. Let’s start with a benefits reform first then look at pensions.

So in summary: means test the state pension.

Do you seriously think that this hasn't been considered by the government and rejected for various reasons?

Working people and employers cannot currently opt out of paying tax and NI. If they can, that’s some major news I’ve missed!

See the original calcs. Teachers and doctors minimally affected.

What the advantage of paying for a private pension where when your only going to be marginally better off
peo wouldn’t bother

households with more than £12,000 a year from private pensions, work, or investments have 50p of SP withdrawn for every £1 above that level, up to the value of the pension itself

So if there's 2 of you claiming SP and one has a PP, you both get penalised?

That would be bang out of order and I would be furious. I am 50 and am currently foregoing luxuries to put as much as I can in to my company pension. I have already EARNT my state pension. Absolutely no to funding people who are making the decisions to not have a private pension.

Also we didn’t have the final salary pensions and the widespread employer pensions with auto-enrolment and matching contributions didn’t exist until Gen X were halfway or later through their working years. So this would push an entire generation into pensioner poverty.

Personally if you did that I’d stop saving into a private pension and invest in property or stocks instead.

See the calcs. For the majority, will still receive full pension, including those with a private pension/income of 12k on top of SP

60% keep full SP.

Those in genuine poverty would continue to get pension credits. This proposal does not affect the majority.

@OwnGravityField so you're proposing taking away the pension from people who currently receive it? And who have made their financial calculations based on receiving it? Or are you proposing a gradual implementation?

Personally, having paid additional years of NI to bring me up to full pensionable years, I'd sue a a government who then didn't pay my pension.

I do have a small work pension but I could not survive on it. I also have some savings but I expect they will be used to fund my care in older age.

OP seems to be ignoring points like this

Whenever people come up with these ideas, they completely forget to factor in that people will change their behaviour accordingly. You have based your sums on the assumption that if you did this, then everyone would continue as they are. But of course, they wouldn’t. Those whose private pensions are the same ish, would just not bother saving.

So my decades of paying into a state pension for the generation before me is wiped out when it's my turn? And by paying into a private pension for decades means I'm not entitled to any state pension? This would encourage everyone to not have a private pension or be careful.

And implementing your idea could easily cost a fortune and cause protesting and further reliance on the state.

Sorry but that is poverty. £12k/yr for households ( usually two people)?

and also the %s would change every year so you can’t promise this.

Yeah, no.

I would just be bloody pissed off that I have paid in for 35 years and you are proposing that I won't get a pay out because I also had the foresight to have a private pension. I could have put the private pension money into shares instead and got my state pension.

If you changed it so you either pay into a state system or a private one, maybe, but it couldn't be retrospective. You can't just take away a benefit people have paid into for 40 years.

Much of our post retirement income is rental from a flat I used to live in. How would you determine income from non pension sources (consultancy income, royalties) and would you include savings? Property? Gifts?

I’d cash mine out and give it to my kids no matter what the tax penalty was.

Thankfully ChatGPT isn’t being used to make public policy.

It’s never accurate on statistics, by the way.

Not a bad idea at all but step 1 would have to be to get rid of NI by increasing income tax. People won’t wear a means tested state pension while we maintain the fiction that your state pension is funded by your NIcs.

With the SP on top that’s 25k a year. The amount the government expects families to live off.

Why are we always so keen to keep taking off those who have already contributed? I’m not a high earner, definitely in the squeezed middle, but I’m so sick of seeing it. This government is so keen to be seen to “level up” that all they do is keep trying to make the richer people poorer, whilst leaving those not contributing being carried by society.

12k is nothing, I’ve paid tax for years to contribute to this and pensioners vote. Make it 50k or even 100k - but not sure how much you would save then