Has Labour crashed the economy ?

[Dbank]

With recent news on GDP and job vacancies, do you think Labour's actions are about to trigger a recession?

Like many things our 4 year government terms don’t lead to the reform we need.
things like replacing the right to buy houses, no government did it as it wouldn’t benefit the here and now. Instead they just took the cash out.

Private only pensions sounds like some peoples idea of a wet dream. Big companies to invest in and finger pointing that you didn’t work hard enough to have the heating on

@Nordione1

"I think the whole system will need reform somehow as it is a future massive unaffordable burden for our children. No idea how though. Maybe raising the retirement age?"

I agree that the whole system needs reform and along with the NHS is one of the biggest Government costs. So if you need to cut spending then it is an obvious place to start to make significant savings. Rather than dicking about with the £12 billion on foreign aid or HS2 or aircraft carriers etc.

The most immediate way to make the savings is to say put up the retirement age by say 2 or 3 months every year rather than a cliff edge change at certain points in time.

Agree. That would be a fair way.

Bring on assisted dying

nuclear power everywhere although it will take time to come on board

make weight loss drugs available on nhs

Everyone goes on about state pension being paid for by the current workers - so are public sector pensions. If they suddenly decided there wasn’t enough tax coming in the pay out all the defined benefit public sector pensions people would be up in arms! The social contract is that by paying our NI we have earned state pension.

It is like an insurance, as it says on the label. We paid in.

@Nordione1

Also means testing the state pension is a sure fire way to discourage people to invest in a private pension.

It would be far better just to put up the retirement age and if you want to retire earlier then invest in a private pension.

You are the one that bought it up, why do that it its not even a plan/policy?

So pensions were not being used for their intended purpose but to avoid IH tax, well done Reeves!

One thing comes through on some of yours and others posts... the Wealthy can afford to retire early but the rest of us can carry on working longer.....

The vast majority do not earn enough to amass a large pension pot, you d need around 600k to get the equivalent of the SP and be able index link it.

Agree with you on this.

however would add that this is why public sector pensions need a review. Should private sector workers, with very small pension pots themselves be cross subsidising the very generous public sector pensions. As you say, I think rule of thumb is you need a pot of around £100k to get a pension of around £3k per annum (rough figures) from a private sector pot. How many private sector workers can build pots that large based on average wages?

Weight loss drugs are so expensive that if they were given to all of the UKs fatties, it would bankrupt the NHS, they d have no money to do anything else.

Also, when people stop taking these drugs, the weight piles back on...

How about people move more & eat less? take some responsibility? of course some are due to medical conditions or drugs but the vast majority are not.

The size of some of the people i saw in Derriford Hospital on a recent visit to take my FiL there was shocking, people in the 20s or 30s were the size of houses.

Weight loss drugs may well be expensive but Rachel would be wiser spending the train drivers salary raise on weight loss drugs backed up with education and help for those most in need
People do need to take more responsibility for sure
it’s all about where Labour spend their money
The 1.5 million homes target seems unachievable when you struggle to get planning for a small extension through
I do wonder whether the housing minister has been set up to fail on this one

Right... lets have some perspective.. the train drivers dispute cost £137m to settle, the strike cost the economy over 2 billion lost in production.... thats how the Tories frittered away money, it wasn't even that generous, 5% per year over 3 years.... one of those years inflation was at 11%.

£137m on a pay rise VS £100 billion required to fund weight loss drugs for people who took, generally speaking, a life style style choice.

Agree, people need help and support to make permanant changes to diet, which drugs dont do.

1.5m houses wont be built because we haven't enough construction workers, Labour do intent to shake up planning but we need to reduce demand, by not having so many coming to the UK... last figures were 900k people came here in 2023.

I did say Labour are "potentially " going for pension pots. She's got few options and they are now clearly fair game. Let's wait and see.

Far better to encourage people to be self funders though and create a system to encourage people to pay into their pension particularly if there will be problems in future paying the state pension for everyone.

The trouble is that you want people to put as much money into their own pot to be used for things like care costs but you don't know how long you will live. No one (apart from True Believers) wants to pay more tax such as IHT to be thrown down the Black Hole of Doom. So they will put less money in to support themselves in retirement and therefore it may not last for their life when they need most care. They would change from being self funders to reliant on the state.

Who cares unless you just hate "the rich" whether or not people retire early if they can afford to support themselves for life. They aren't a burden on the taxpayer. Same as private schools. They were't a burden on the taxpayer and now for idealogical reasons they will be.

You would only support making more people the responsibility of the state and increasing the burden on the taxpayer if you loved he thought of your children paying more and more tax to fund pensioners.

I agree with your last point.

Unfortunate the government can change the rules if the country can't afford it. We are earning less and less per capita and there are more and more people coming in who will need pensions eventually but who may not have contributed NI themselves over their working lives if they worked. People are living for years after retirement. It's unsustainable and a terrible burden for our children. I have a great fear when I retire the state pension won't exist..people in the private sector need a fair wind behind them tax wise re saving their own pensions to be self funders.

Brexit did that

Covid did that more.

Although TBF there are more people being laid off now than any time since Covid. Something else must have happened as this seems to have increased since the Budget. If we aren't allowed to include Rachel Reeves in the blame what else has happened to make the private sector start making such large redundancies? Something massive must have triggered it? 🧐

Brexit, you say?

https://www.thetimes.com/business-money/economics/article/imf-predicts-uk-economy-will-outpace-germany-france-and-italy-m0c57927t

It's behind a paywall but here's the jist:

IMF predicts UK economy will outpace Germany, France and Italy
US and UK are the only nations in the G7 to receive upgrades in latest report

UK economic growth will outpace Germany, France and Italy over the next two years, according to new data from the International Monetary Fund.
GDP is set to expand by 1.6 per cent this year and 1.5 per cent in 2026, well above the projected growth rates for Europe’s major economies, according to the Washington-based group’s analysis.
The US and UK are the only nations in the G7 to receive upgrades on their growth forecasts for this year since the IMF’s last report in October.

Rachel Reeves will ensure she does something to scupper that predicted growth sadly.

Annuity rates have improved a lot…if you want an RPI linked single life annuity and are 65 the best rate currently is 5.1%, so for £11,500 or whatever the new state pension is you ‘only’ need £225k or so :)

https://www.retirementline.co.uk/annuities/annuity-rates/

No… you’ve been paying for all the current pensions with your NI contributions.

When you retire, your state pension will be funded by those who are working.

It looked workable until we ended up with shit loads of old people and not enough young people coming up behind them.
Same as all developed economies though, not unique to U.K.

I work in benefits and see how many are claiming them and the amounts. It is going to become completely unaffordable if something isn't done soon. Then there is social care too. It's a ticking timebomb. Goodness knows what would happen if this country faced a sudden catastrophe/ major conflict/ economic crash and it all had to be cut suddenly.
Someone needs to start reforming now.

@sometimesmovingforwards

"It looked workable until we ended up with shit loads of old people and not enough young people coming up behind them. "

It looked workable until the life expectancy went up for men from 65 in 1948 to 79 today and from 70 to 83 for women.

Rather than means test the state pension it would be simpler, reduce costs quicker and less controversial to simply increase the retirement age by 2 or 3 months every year.

Oh I fully agree.
Just keep pushing the retirement age up.

Having people working for 40 years and then expecting the state to fund them for 20 years of retirement is a pisstake to the younger generation working to fund it.