Triple lock: Liz Truss ditches pledge to raise pensions with inflation

[srb7677]

Liz Truss's promise to honour the triple lock for pensioners is utterly worthless now that she has resigned. That pledge dies with her.

We'll have to wait to see if the next incumbent is willing to honour it or not.

[Javert]

That's not strictly true, there is a portion of cash that is is set aside for pensions. This is a fact as I've heard an MP stating when it was going to runout.

That will be for cash flow reasons - they need to assemble cash in accounts to transfer to the pensioners.  A couple of weeks is is not very relevant considering the amount of time you could live after state retirement age.

[Sheepy]

That's not strictly true, there is a portion of cash that is is set aside for pensions. This is a fact as I've heard an MP stating when it was going to runout.

About 14 days' worth I do believe. 

[Nick]

Yes it is correct to say there is no pot and it's never existed,as far as civil service pensions go they are always protected though. 

That's not strictly true, there is a portion of cash that is is set aside for pensions. This is a fact as I've heard an MP stating when it was going to runout. 

[cromwell]

There is a website you can go to where you can find all the years that you have made a contribution.

However all that tells you is that you paid sufficient NI contributions in a particular year (or were awarded them free for one or other reason), in the same way that your tax returns tell how much tax you paid in past years. 

There is no actual pot of money with a specific value set aside in your name that you could somehow decide to "withdraw" if you wanted to.  Not to mention, NI contributions are not only for pensions - they are ostensibly also for the NHS and theoreticlaly social care.  However even that is only in name only - the reality is that all the money we pay in NI is basically just treated as tax income like income tax.

With a defined contribution SIPP pension, there is an actual pot of money in your name that has a value of £X - you can see it on a website and its value will go up and down over time if you have invested it in markets - you can also choose where your individual pot is invested.

With a defined benefit pension, there are laws that show that the fund must have enough money in the bank that they can cover the pensioners pensions in all reasonable scenarios.

With the state pension (and also public service pensions like NHS or civil service), these pension are "unfunded" - this means that the payments to pensioners are basically paid out of general current outgoings of the government.

This is why I have made the point several times on this forum, that if the economy completely collapsed, your state pension would not be protected - if the government decided to cut your state pension and it got through parliament, you would not be able to sue the government for "stealing" the money you had paid in, because it simply doesn't work like that.

That's pretty much how it's always been.

Yes it is correct to say there is no pot and it's never existed,as far as civil service pensions go they are always protected though.  

[Sheepy]

No.

Pensioners have suffered the effects of boom and bust — it takes some screwed up thinking to think they've been the cause...

Maybe, but as that isn't what I said but what you said.

[Javert]

I believe there is a pot, any link to show there isn't!

There is a website you can go to where you can find all the years that you have made a contribution.

However all that tells you is that you paid sufficient NI contributions in a particular year (or were awarded them free for one or other reason), in the same way that your tax returns tell how much tax you paid in past years.  

There is no actual pot of money with a specific value set aside in your name that you could somehow decide to "withdraw" if you wanted to.  Not to mention, NI contributions are not only for pensions - they are ostensibly also for the NHS and theoreticlaly social care.  However even that is only in name only - the reality is that all the money we pay in NI is basically just treated as tax income like income tax.

With a defined contribution SIPP pension, there is an actual pot of money in your name that has a value of £X - you can see it on a website and its value will go up and down over time if you have invested it in markets - you can also choose where your individual pot is invested.

With a defined benefit pension, there are laws that show that the fund must have enough money in the bank that they can cover the pensioners pensions in all reasonable scenarios.

With the state pension (and also public service pensions like NHS or civil service), these pension are "unfunded" - this means that the payments to pensioners are basically paid out of general current outgoings of the government.

This is why I have made the point several times on this forum, that if the economy completely collapsed, your state pension would not be protected - if the government decided to cut your state pension and it got through parliament, you would not be able to sue the government for "stealing" the money you had paid in, because it simply doesn't work like that.

That's pretty much how it's always been.

[Nick]

careful there - I got into terrible hot water here a while back for pointing out that the state pension is funded from current receipts and there is no pot of money set aside in the name of each citizen like there would be with a private pension like a SIPP - if tax receipts collapsed catastrophically there would be no money to pay current pensioners - you can see this if you look at the government's balance sheet and finances.

I believe there is a pot, any link to show there isn't!

[Javert]

I've not seen any post calling for pensioners to pay more tax than any one else, or pay NI if they're not in paid employment.

The NI bit on paid work is new, but pensioners already pay tax on the state pension and other pensions as their income rises above personal allowances and reaches the normal tax thresholds.

But all this sob story about pensioners have already paid their whack is a misunderstanding. Anything they've paid into pension schemes is not taxed — it's only taxed when it's drawn out, and even then a portion can be taken tax free.

And what they're being paid by the state pension today is funded by today's taxpayers, same as it was when  today's pensioners were part of the workforce...

careful there - I got into terrible hot water here a while back for pointing out that the state pension is funded from current receipts and there is no pot of money set aside in the name of each citizen like there would be with a private pension like a SIPP - if tax receipts collapsed catastrophically there would be no money to pay current pensioners - you can see this if you look at the government's balance sheet and finances.

[Borchester]

No.

Pensioners have suffered the effects of boom and bust — it takes some screwed up thinking to think they've been the cause...

The world has suffered from boom and bust since the year one, when Og started speculating in Buy To Let caves and fine fellow that he is, Steve is talking through his arse because central to his economic thinking is that all problems can be solved by blaming someone else and shooting a few kulaks.

[patman post]

Haven't these same policies created constant boom and bust before?

No.

Pensioners have suffered the effects of boom and bust — it takes some screwed up thinking to think they've been the cause...

[Sheepy]

Any change can be said to be "moving the goal posts". What it is is asking pensioners who are well off enough to do so pay the same taxes as everyone else. What it isn't is reducing them all to my level as you falsely claimed.

And you have not already paid "full whack" on it. As Patman pointed out, you were not taxed on your pension contributions and are not taxed upon them until you receive them back.

Haven't these same policies created constant boom and bust before?

[srb7677]

It's not made up, you just espoused pensioners still paying NIC's even though they have already paid their full whack, that's called moving the goalposts. 

Any change can be said to be "moving the goal posts". What it is is asking pensioners who are well off enough to do so pay the same taxes as everyone else. What it isn't is reducing them all to my level as you falsely claimed.

And you have not already paid "full whack" on it. As Patman pointed out, you were not taxed on your pension contributions and are not taxed upon them until you receive them back.

[patman post]

It's not made up, you just espoused pensioners still paying NIC's even though they have already paid their full whack, that's called moving the goalposts.
The rules are set but you want to change them to punish the more well off, same as windfall tax. Businesses and people engage with the system knowing what they must pay and then the you want to change the rules. Tell you what Steve, you pull into a garage after looking at the price per litre and then after filling up they charge you 25% more to help the poor, are you going to swallow that? NO

I've not seen any post calling for pensioners to pay more tax than any one else, or pay NI if they're not in paid employment.

The NI bit on paid work is new, but pensioners already pay tax on the state pension and other pensions as their income rises above personal allowances and reaches the normal tax thresholds.

But all this sob story about pensioners have already paid their whack is a misunderstanding. Anything they've paid into pension schemes is not taxed — it's only taxed when it's drawn out, and even then a portion can be taken tax free.

And what they're being paid by the state pension today is funded by today's taxpayers, same as it was when  today's pensioners were part of the workforce...

[Nick]

The same beloved straw man lie. I have no desire to make everyone as poor as me.

Like many a right winger you just made that up. It's your favourite straw man

As for automated checkouts, I do far more than work on checkouts which I only spend a small minority of my time doing. And not all manned checkouts are going to be replaced just yet. They still need to persuade more customers to use self service before they can move to them entirely .

It's not made up, you just espoused pensioners still paying NIC's even though they have already paid their full whack, that's called moving the goalposts. 
The rules are set but you want to change them to punish the more well off, same as windfall tax. Businesses and people engage with the system knowing what they must pay and then the you want to change the rules. Tell you what Steve, you pull into a garage after looking at the price per litre and then after filling up they charge you 25% more to help the poor, are you going to swallow that? NO