Raise the pension age to 75.

[ellal]

You need to be practical about who will fund the cost. Its easy to look at the top 0.01% or 0.1% of earners (£650K+) and argue they don't play fair and I'm sure plenty don't, but the top 1% (£160K+) pay nearly 30% of all taxes. Contrast that with the fact that 40% of Adults pay less than £2000 per year in income tax.

Then you have to look at where the money will actually come from. Imagine the current over 65s living 1 more year each. Thats £70bn, the people paying the tax will be those working. If you want to retire young, its up to you to save for it.

The problem is, those with vast wealth (or even relative wealth) have often got there by putting their money beyond the taxman or by using beneficial tax rules written with them in mind!

Add to that the money that corporates have also used beneficial tax laws to avoid paying, then you start to get an idea where the money to fund a decent pension system etc could be found!

In the early '80's the UK had some of the best state pension provision in Western Europe.

It now has the worst!

 

[ellal]

Then you have to look at where the money will actually come from. Imagine the current over 65s living 1 more year each. Thats £70bn, the people paying the tax will be those working. If you want to retire young, its up to you to save for it.

Further on this...

Where do you think that most people can find that money to save for their old age?

Low salaries, ludicrously high rents, and added debts such as student loans make putting money away impossible for most people.
(the latter the government know is more expensive than providing free university education, but control by debt is more important!)

Those who can afford to save have usually benefited at some point from inherited wealth, whether directly or indirectly!

 

[JP_]

Is it right that the majority of the population should expect to get back significantly more than they put in?

isn't this the point on pension investments - they grow over the 40-50 years you work to then provide more in retirement?
That is how private pensions work, so why not state pensions too? If the pot is not getting bigger, you have to ask, where is my money going?

 

[ellal]

That is how private pensions work, so why not state pensions too? If the pot is not getting bigger, you have to ask, where is my money going?

With the state pension you are not paying for your pension per se, you are funding the older generations.

And thus when you retire, the younger generations are paying yours.

The problem is it is too easy to 'siphon off' money from such a scheme for whatever reason, thus giving us the pension 'black hole' we have now!

 

[bernardgreen]

That is how private pensions work, so why not state pensions too?

That is believed to be the way State Pensions would be financed when they were introduced. But the State Pension Fund was "robbed" by governments to fund " make the people happy " projects to win votes at the next election.

 

[Vinty]

I believe that higher earners pay National insurance contributions at 2% of their earnings above £50,000 per year compared to a rate of 12% for those earning under £50,000.
Maybe higher earners should pay N.I. at a higher rate.
As life expectancy is a lot less for lower earners than for higher earners why should lower earners have to pay a higher rate of N.I. to fund the pensions of those who statistically are going to be around for a lot longer than they are.

 

[SirGalahad]

You need to be practical about who will fund the cost. Its easy to look at the top 0.01% or 0.1% of earners (£650K+) and argue they don't play fair and I'm sure plenty don't, but the top 1% (£160K+) pay nearly 30% of all taxes. Contrast that with the fact that 40% of Adults pay less than £2000 per year in income tax.

Then you have to look at where the money will actually come from. Imagine the current over 65s living 1 more year each. Thats £70bn, the people paying the tax will be those working. If you want to retire young, its up to you to save for it.

Your missing out indirect taxes like VAT which are more regressive. Also cut the loopholes on corporation tax.

The people who get squeezed the most on taxes as a percentage of income are the middle and upper middle classes which this Government hasn't done much to help at all. Better of being a contractor and having a LTD company.

 

[motorbiking]

isn't this the point on pension investments - they grow over the 40-50 years you work to then provide more in retirement?
That is how private pensions work, so why not state pensions too? If the pot is not getting bigger, you have to ask, where is my money going?

Yep and there still wouldn't be enough money for 11M pensioners to have an additional 5 years of pension, let alone 10 years or more people getting to 65 to start with..

 

[motorbiking]

Yep and there still wouldn't be enough money for 11M pensioners to have an additional 5 years of pension, let alone 10 years or more people getting to 65 to start with..

I believe that higher earners pay National insurance contributions at 2% of their earnings above £50,000 per year compared to a rate of 12% for those earning under £50,000.
Maybe higher earners should pay N.I. at a higher rate.
As life expectancy is a lot less for lower earners than for higher earners why should lower earners have to pay a higher rate of N.I. to fund the pensions of those who statistically are going to be around for a lot longer than they are.

It actually isn't: 8.4 years for richest over poorest. Slice the healthier bottom 25%ile of poorer people vs the top 75%ile or better off and is bugger all (around 2 years). The very poorest are often skewed by poor heath (drugs and alcohol).

 

[JohnD]

Contrast that with the fact that 40% of Adults pay less than £2000 per year in income tax.

I'm sure nobody is surprised that people with not much income don't pay much income tax. It is shameful that so many of our citizens are on such low incomes.

However some might be more surprised to know that the likes of Amazon, Microsoft, Sky, Starbucks, foreign-owned Cadburys, and the Daily Mail operate in the UK, sell to UK customers, make huge profits in the UK, yet pay derisory amounts of tax. The EU is making the first steps to charging companies tax in the countries where they make their money. By astonishing coincidence, the tax-dodging owners of mass-media companies have campaigned long and hard to get UK away from the EU and its movement towards fairer tax.

 

[JohnD]

"Cadbury owner Mondelez UK paid no corporation tax in Britain last year, despite reporting profit of more than £185m.

The company, which is a subsidiary of US giant Mondelez International, recorded a 740 per cent jump in profit for the year to 31 December, with turnover rising to £1.66bn from £1.65bn.

However, in documents filed at Companies House, Mondelez reported that it paid no tax last year, and in fact recorded a tax credit of £320,000.

Meanwhile, a dividend of £247m was paid to its immediate owner, Kraft Foods Schweiz Holdings, which is incorporated in Switzerland."

https://www.independent.co.uk/news/...-corporation-tax-paid-uk-profit-a8578951.html

So that's a wedge of money off public spending, or fewer tax cuts for UK citizens, depending on your political sympathies.

 

[JohnD]

Then you have to look at where the money will actually come from.

I can't imagine, can you?

https://www.thisismoney.co.uk/money...est-firms-paid-year-5-got-handout-taxman.html

 

[JohnD]

where's the money to come from?

"But an index published today by the Tax Justice Network found that the UK has “single-handedly” done the most to break down the global corporate tax system which loses an estimated $500bn (£395bn) to avoidance.

The amount dodged globally each year is more than three times the NHS budget or roughly equivalent to the entire Gross Domestic Product (GDP) of Belgium. Tax haven territories linked to Britain are responsible for around a third of the world’s corporate tax avoidance risk – more than four times the next greatest contributor, the Netherlands."

https://www.independent.co.uk/news/...-havens-justice-network-dodging-a8933661.html

 

[JP_]

Yep. There's only one party that is for the people, we all know who that is, but most fear them because of silly stories in the right wing press.

 

[JohnD]

"Online retail giant Amazon's UK paid £1.7m in taxes despite profits almost trebling to £72.3m."

https://www.bbc.co.uk/news/business-45053528