ePetition against Frozen Pension Policy
Jul 24th 2012, 4:16 am
#61
snɐןɔ ʎʇıuɐs
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Re: Calling British Expats
It has been forecast that in the UK at least, people born after 1975 will constitute the majority of the electorate after about 2020. This is because many of the older boomers (1945 - 1960) are already starting to die off. This is because only a certain percentage of people live to 70/80/90 etc.
Anyway, if you are liable to retire after 2020, in my estimation you have to assume you will never retire. The problem is the baby boomer bulge is going to change from being net contributors, to claimants. Therefore the pension funds need to pay out; taking their investments out of the stock market, etc. That means values will fall, meaning more needs to be removed to fund guaranteed returns. At the same time, since middle class incomes have been stagnant for decades, and are likely to continue to fall in real terms, people won't be able to afford to pay in - so the pension schemes become a ponzi scheme.
All it then takes is a GFC, which we must expect regularly, for the whole edifice to come crumbling down - domino style.
As I say, in reality you have to expect never to retire. Which makes the whole issue of who gets what from the government funds moot - everyone will be on less than subsistence.
Jul 24th 2012, 4:26 am
#62
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Posts: 3,300
Re: Calling British Expats
Well, electorate != voters, and part of the issue is how many will live to 70, 80, 90, etc.
Anyway, if you are liable to retire after 2020, in my estimation you have to assume you will never retire. The problem is the baby boomer bulge is going to change from being net contributors, to claimants. Therefore the pension funds need to pay out; taking their investments out of the stock market, etc. That means values will fall, meaning more needs to be removed to fund guaranteed returns. At the same time, since middle class incomes have been stagnant for decades, and are likely to continue to fall in real terms, people won't be able to afford to pay in - so the pension schemes become a ponzi scheme.
All it then takes is a GFC, which we must expect regularly, for the whole edifice to come crumbling down - domino style.
As I say, in reality you have to expect never to retire. Which makes the whole issue of who gets what from the government funds moot - everyone will be on less than subsistence.
Anyway, if you are liable to retire after 2020, in my estimation you have to assume you will never retire. The problem is the baby boomer bulge is going to change from being net contributors, to claimants. Therefore the pension funds need to pay out; taking their investments out of the stock market, etc. That means values will fall, meaning more needs to be removed to fund guaranteed returns. At the same time, since middle class incomes have been stagnant for decades, and are likely to continue to fall in real terms, people won't be able to afford to pay in - so the pension schemes become a ponzi scheme.
All it then takes is a GFC, which we must expect regularly, for the whole edifice to come crumbling down - domino style.
As I say, in reality you have to expect never to retire. Which makes the whole issue of who gets what from the government funds moot - everyone will be on less than subsistence.
My basic view here is that pressure to move funds from workers to the pensioners will continue until they become a weaker voting demographic, and then they're going to be pushed out the door to fend for themselves. This might never happen if the gen under boomers retires early and we get a massive block of pensioners with one interest stretching from those born 1945 - 1975, etc. Someone born in 1975 who retires at 55 in 2030 is going to vote for policy that will also benefit someone born in 1945 who is now 85 - they will both be pensioners.
This won't happen in my opinion because they will simply ban retirement, and people will work until they drop just like centuries past. The reason is that once upon a time retirement was a short period of time before you died, basically, but with lifespans stretching to 90+ this messes up the maths in a big way. Also, the problem was compounded by boomers taking the mickey and retiring at 55 and having 40 year retirements, etc. Simply cannot be funded by the state.
Last edited by Zen10; Jul 24th 2012 at 4:28 am.
Jul 24th 2012, 4:43 am
#63
snɐןɔ ʎʇıuɐs
Joined: Nov 2006
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Re: Calling British Expats
To see a forecho of that world, look to greece today : http://www.rt.com/news/greece-pensio...de-crisis-619/
Jul 24th 2012, 4:48 am
#64
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Posts: 3,300
Re: Calling British Expats
The voting block is there as a backstop issue - but I think the collapse of the pension schemes, and much of the existing financial industry, will get there before it really hits home. The baby boomer block will be livid, and will try to vote themselves a safety net - but the issue is too big and will be too much of a fait accompli.
To see a forecho of that world, look to greece today : http://www.rt.com/news/greece-pensio...de-crisis-619/
To see a forecho of that world, look to greece today : http://www.rt.com/news/greece-pensio...de-crisis-619/
Jul 24th 2012, 10:57 am
#65
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Re: ePetition against Frozen Pension Policy
Even if a baby boomer retires at 55 they do not get a state pension until they are 65 (male) or 60 (female born before 1950). So as the oldest boomers are 67 now I think you shouldn't expect them to die off by 2020, given their life expectancy is well over 80. Many female baby boomers are not entitled to a full pension in their own right as they didn't work enough years (39 required for those born before 1950) or paid only the married woman's NI contribution when it was available (when husbands had to file the tax returns for wives).
Jul 24th 2012, 11:48 am
#66
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Re: ePetition against Frozen Pension Policy
Even if a baby boomer retires at 55 they do not get a state pension until they are 65 (male) or 60 (female born before 1950). So as the oldest boomers are 67 now I think you shouldn't expect them to die off by 2020, given their life expectancy is well over 80. Many female baby boomers are not entitled to a full pension in their own right as they didn't work enough years (39 required for those born before 1950) or paid only the married woman's NI contribution when it was available (when husbands had to file the tax returns for wives).
Jul 24th 2012, 3:20 pm
#67
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Location: New Brunswick
Posts: 227
Re: Calling British Expats
The day the British elite start retiring to Australia is the day this gets changed. If you don't want your pension frozen, move somewhere where the rich retire - like USA or Caribbean. All the places were the British Expat masses are growing older, primarily Australia and Canada and NZ, they freeze. No petition will change this.
It can be changed if the will is there and people that think like you are the problem. Taking a defeatist attitude was not the way that the war was won and you should be taking a positive step towards what is an immoral and unjust policy by the British government. All frozen pensioners paid in under the same terms and conditions as those that do get the annual uprating.
The freezing is nothing to do with agreements with any country but purely the will of MP's in parliament who are supposed to be there to represent the people and as British citizens they should be representing you.
You may like to know that the National Insurance fund from which the pensions are paid is in a big surplus condition to the tune of about 40 billion GBPounds and increasing annually by about 2 billion. Now the government borrow from this fund through the Debt Management Office and as it is ringfenced , they have to pay it back with interest. Last year the interest was 1.3 billion GBPounds and the cost to uprate ALL pensioners is about 650 million GBPounds , so you can see that it would only take half of the repaid interest to pay everyone. It's true to say that the government would then not have that money to reborrow but that should not enter into the argument because all pensions should be paid from the fund BEFORE any further borrowing takes place. In addition, if the government stopped denying the pensioner their full entitlement and encouraged them to emigrate it has been quoted that the savings due to not having to pay for the many allowances and benefits that are given would save the country about 7,000 GBPounds per year for each person that migrates and appafrently there are a few thousand that have said that the freezing is stopping them. I cannot verify those figures but the general opinion is that maintaing the freezing is doing more damage financially than removing it.
Last edited by moneypenny20; Jul 25th 2012 at 3:18 am. Reason: fixing quote
Jul 24th 2012, 9:47 pm
#68
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Posts: 3,300
Re: Calling British Expats
Yes, that is the type of attitude that gets nothing changed.
It can be changed if the will is there and people that think like you are the problem. Taking a defeatist attitude was not the way that the war was won and you should be taking a positive step towards what is an immoral and unjust policy by the British government. All frozen pensioners paid in under the same terms and conditions as those that do get the annual uprating.
The freezing is nothing to do with agreements with any country but purely the will of MP's in parliament who are supposed to be there to represent the people and as British citizens they should be representing you.
You may like to know that the National Insurance fund from which the pensions are paid is in a big surplus condition to the tune of about 40 billion GBPounds and increasing annually by about 2 billion. Now the government borrow from this fund through the Debt Management Office and as it is ringfenced , they have to pay it back with interest. Last year the interest was 1.3 billion GBPounds and the cost to uprate ALL pensioners is about 650 million GBPounds , so you can see that it would only take half of the repaid interest to pay everyone. It's true to say that the government would then not have that money to reborrow but that should not enter into the argument because all pensions should be paid from the fund BEFORE any further borrowing takes place. In addition, if the government stopped denying the pensioner their full entitlement and encouraged them to emigrate it has been quoted that the savings due to not having to pay for the many allowances and benefits that are given would save the country about 7,000 GBPounds per year for each person that migrates and appafrently there are a few thousand that have said that the freezing is stopping them. I cannot verify those figures but the general opinion is that maintaing the freezing is doing more damage financially than removing it.
It can be changed if the will is there and people that think like you are the problem. Taking a defeatist attitude was not the way that the war was won and you should be taking a positive step towards what is an immoral and unjust policy by the British government. All frozen pensioners paid in under the same terms and conditions as those that do get the annual uprating.
The freezing is nothing to do with agreements with any country but purely the will of MP's in parliament who are supposed to be there to represent the people and as British citizens they should be representing you.
You may like to know that the National Insurance fund from which the pensions are paid is in a big surplus condition to the tune of about 40 billion GBPounds and increasing annually by about 2 billion. Now the government borrow from this fund through the Debt Management Office and as it is ringfenced , they have to pay it back with interest. Last year the interest was 1.3 billion GBPounds and the cost to uprate ALL pensioners is about 650 million GBPounds , so you can see that it would only take half of the repaid interest to pay everyone. It's true to say that the government would then not have that money to reborrow but that should not enter into the argument because all pensions should be paid from the fund BEFORE any further borrowing takes place. In addition, if the government stopped denying the pensioner their full entitlement and encouraged them to emigrate it has been quoted that the savings due to not having to pay for the many allowances and benefits that are given would save the country about 7,000 GBPounds per year for each person that migrates and appafrently there are a few thousand that have said that the freezing is stopping them. I cannot verify those figures but the general opinion is that maintaing the freezing is doing more damage financially than removing it.
The NI fund you refer to is of course required for many more things than simply pensions and I think it is highly unlikely any government will unfreeze pensions using the money from this fund.
Don't get me wrong on this subject. I think frozen pensions are an absolute scandalous disgrace, but I make the observation that most of the countries with unfrozen pensions are where the British elite have traditionally held close ties like the US and certain Caribbean countries. Australia has nearly half of the frozen pensions and we're talking regular working-class people - can't see an incentive for government to change this. I note the Australian Government pays its pensioners retired in the UK in line with inflation.
Last edited by moneypenny20; Jul 25th 2012 at 3:19 am. Reason: Fixed quotes.
Jul 25th 2012, 3:41 am
#69
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Location: New Brunswick
Posts: 227
Re: Calling British Expats
If you are a young person, I respect your opinion. If not, I must take issue with your naivety. Taking a realistic view of a subject does not constitute being part of the problem. I would argue that people living in cloud cuckoo land are part of the problem. No petition is going make a state like Britain change the law on frozen pensions for its citizens living in Australia and Canada. there are too many of them and the UK is essentially bankrupt as it is. The last thing it needs is having to finance billions more (over time) in an unexpected pensions increase.
The NI fund you refer to is of course required for many more things than simply pensions and I think it is highly unlikely any government will unfreeze pensions using the money from this fund.
Don't get me wrong on this subject. I think frozen pensions are an absolute scandalous disgrace, but I make the observation that most of the countries with unfrozen pensions are where the British elite have traditionally held close ties like the US and certain Caribbean countries. Australia has nearly half of the frozen pensions and we're talking regular working-class people - can't see an incentive for government to change this. I note the Australian Government pays its pensioners retired in the UK in line with inflation.
The NI fund you refer to is of course required for many more things than simply pensions and I think it is highly unlikely any government will unfreeze pensions using the money from this fund.
Don't get me wrong on this subject. I think frozen pensions are an absolute scandalous disgrace, but I make the observation that most of the countries with unfrozen pensions are where the British elite have traditionally held close ties like the US and certain Caribbean countries. Australia has nearly half of the frozen pensions and we're talking regular working-class people - can't see an incentive for government to change this. I note the Australian Government pays its pensioners retired in the UK in line with inflation.
Parliament can only use the ring fenced NI fund to meet legitimate claims falling within the remit of the NI Act.
Is the government not in breach of its own rules by syphoning off "a surplus" for other uses and not meeting a 'competing claim' under the Act, which is both covered and protected by the ring fencing?
The competing claim being that of the frozen pensioner.
The more people that write to an MP or the DWP the better.
Jul 25th 2012, 7:05 am
#70
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Posts: 3,300
Re: Calling British Expats
Thank you for agreing that the freezing is unfair and let's get the situation corrected then. If all the British citizens in Australia were to sign that e-petition it would show that they want the government to play the game. I agree that the NI fund is used for more than just the pensions alone but that does not change the situation. Why should the Australian taxpayers and the Canadian taxpayers have to put their hand in thir pocket for the British government by having to support the pensioner who is in a poverty situation ? The Canadian pensioner like the Australian can retire anywhere in the world and recieve the uprating. Whether the pensioner knew about the freezing before emigrating or not, there is no excuse for doing it in the first place. Think about this then :
Parliament can only use the ring fenced NI fund to meet legitimate claims falling within the remit of the NI Act.
Is the government not in breach of its own rules by syphoning off "a surplus" for other uses and not meeting a 'competing claim' under the Act, which is both covered and protected by the ring fencing?
The competing claim being that of the frozen pensioner.
The more people that write to an MP or the DWP the better.
Parliament can only use the ring fenced NI fund to meet legitimate claims falling within the remit of the NI Act.
Is the government not in breach of its own rules by syphoning off "a surplus" for other uses and not meeting a 'competing claim' under the Act, which is both covered and protected by the ring fencing?
The competing claim being that of the frozen pensioner.
The more people that write to an MP or the DWP the better.
Jul 25th 2012, 7:23 am
#71
snɐןɔ ʎʇıuɐs
Joined: Nov 2006
Posts: 6,558
Re: Calling British Expats
There is zero chance of anything changing unless the UK government want it to change, and they are not going to want that unless there is political benefit in it for them to outweigh the not inconsiderable cost (particularly when you consider that camaroon has said austerity will continue till at least 2020).
Forget your petition, which at the best of times would just get ignored anyway. Instead organise a voting group that promises to vote for any party that will deliver the required change. With potentially half a million such voters, it's possible to use that electoral muscle, if difficult.
Jul 25th 2012, 10:19 am
#72
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Re: ePetition against Frozen Pension Policy
But their life expectancy isn't "well over 80". Only a certain percentage will go past 70, and then again past 75, and then past 80, etc. It's this ever diminishing effect that will finally push their numbers down so they are no longer the biggest demographic. Our 67 year-olds will be 80 in 13 years which is 2025, and only a third of people live over 80.
Table 2. Life expectancy at age 65: by sex and country, 2004-06 to 2008-10
Years
Country 2004-06 2005-07 2006-08 2007-09 2008-10
Males
United Kingdom 17.0 17.3 17.5 17.8 18.0
England and Wales 17.2 17.4 17.7 17.9 18.2
England 17.2 17.5 17.7 18.0 18.2
Wales 16.8 17.0 17.2 17.4 17.7
Scotland 15.9 16.1 16.3 16.5 16.8
Northern Ireland 16.7 16.9 17.0 17.2 17.4 p
Females
United Kingdom 19.8 20.0 20.2 20.4 20.6
England and Wales 19.9 20.1 20.3 20.5 20.8
England 19.9 20.2 20.4 20.6 20.8
Wales 19.5 19.8 20.0 20.1 20.3
Scotland 18.6 18.8 18.9 19.1 19.3
Northern Ireland 19.6 19.8 19.8 20.0 20.2 p
1 Three year rolling averages, based on deaths registered in calendar years and mid-year population estimates.
2 Figures for England and Wales include deaths of non-residents. Figures for England and Wales separately exclude deaths of non-residents.
p = provisional
http://www.ons.gov.uk
Sorry all the spacing got messed up but I think you can see males now aged 65 can expect to live to about 83, females to 85
Jul 25th 2012, 10:32 am
#73
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Posts: 27,219
Re: ePetition against Frozen Pension Policy
But their life expectancy isn't "well over 80". Only a certain percentage will go past 70, and then again past 75, and then past 80, etc. It's this ever diminishing effect that will finally push their numbers down so they are no longer the biggest demographic. Our 67 year-olds will be 80 in 13 years which is 2025, and only a third of people live over 80.
Jul 25th 2012, 12:23 pm
#74
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Posts: 3,300
Re: ePetition against Frozen Pension Policy
Thanks for these lesleys - really interesting. I'm a real geek for stats. If our oldest boomers are 67 and they're going to hit 83 on average (I am sure only a certain percentage of them will get over 80 though??) that's 16 years, so 2028 is the year.
Jul 25th 2012, 1:27 pm
#75
pink 'n' bouncy
Joined: Jul 2006
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Re: ePetition against Frozen Pension Policy
I signed FWIW