"Not enough in the pension pot" my arse

[Japey]

Coincidentally, I'm having to make my decision about a pension just as this is all coming out in the news. I've got a few observations...

1) I don't trust the stock market one bit. All the financial advisers (actually, almost everybody) alive today have had the unusual experience of living in a time of year-on-year economic growth. They assume that because this has happened all their lives, it will continue to happen. However, given the very probable imminent peak in oil production (which may already have happened), this is a very poor assumption. And when the stock market crashes, all the pensions crash as well. State and civil service pensions aren't much better - they depend on government bonds.

2) While people on here are right that there's a huge amount of money sloshing around UK financial institutions, you've also got to look at it from a global perspective. Most of the energy resources that we convert into cash (oil, and to a lesser extent gas and coal) don't originate in the UK. Talk about equitable redistribution but this isn't going to benefit UK pensioners. Most of that cash would have to be spent compensating the third world for all the stuff we've taken off them. If there were a revolution, this would probably increase the number of elderly people who live in poverty here.

3) It's a fact that we have an ageing population. People are living much longer than before, meaning that pension costs have to be stretched to cover more years. On the flip side, people are having fewer children, so there are less people to support pensioners. And don't forget the associated health costs for old-aged people.

4) I never really saw the point of throwing so many resources at people who are unable to enjoy the benefits. Why do we keep somebody vegetating in an old people's home for 20 years? In more 'primitive' societies, it is expected that people wander out into the wilderness when they get to this stage. This is what I fully intend to do.


It's certainly not going to be a comfortable retirement for many of us to look forward. Maybe the only solution is to emigrate to somewhere with a better climate and a lower cost of living for one's retirement?

 

[sihhi]

4) I never really saw the point of throwing so many resources at people who are unable to enjoy the benefits. Why do we keep somebody vegetating in an old people's home for 20 years? In more 'primitive' societies, it is expected that people wander out into the wilderness when they get to this stage. This is what I fully intend to do.

Are you joking or being a student pub comic?

 

[jiggajagga]

I suppose in my use of the word "altrenative" I should qualify that a little.

The difference offered between the parties are between two differing visions of Victorian values. The classical liberal and the communitarian values of the Christian socialists of the 19thC. Either way self reliance seem to run through the discourse.

The idea of national insurance in any form seems to have fallen off the agenda.

Since this does not seem to be a problem for those of working age, as comparing pension provisoin seems to be all the rage, this is something that needs to be shifted way up the political agenda.

Its too easy to think of the elderly as a drain on resources without considering the effects that time has on all of us. For those opposed to state provision I would say we reap what we sow. If we place part of our income in the hands of those who only seek to profit from us then don't be suprised when they piss off with our money.

As someone who is and will be on a low income for the rest of his life I have had to accept that I am one of those who is going to be poor in retirement. It is all relative what 'poor' is. I ask for very little so I am generally content that what will be will be and is out of my hands.
However, how the hell somone younger on a minimum wage who has to pay rent/mortgage, Community charge, Water, Gas, Electric, phone, etc and hope to raise a family, etc is supposed to save for retirement is truly beyond me!
In fact, I think it a bit of a 'chattering class' bollocks
Governments have seen this coming since the baby boom after the second world war ( of which I am one) and done nothing about it.
All I know is this. The poor will still be poor and the rich will still get richer with whatever welfare changes come in.

GOD BLESS CAPITALISM.....INNIT GREAT!!!!....NOT!

 

[Japey]

Are you joking or being a student pub comic?

I was trying to make some observations. Is it really humane to throw so many resources maintaining the material shell of a person - but so little to nourish the spirit? I just don't see the point.

 

[pilchardman]

Is it really humane to throw so many resources maintaining the material shell of a person - but so little to nourish the spirit? I just don't see the point.

No. But the answer would be to try to nourish the spirit, not to demand suicide.

 

[Japey]

No. But the answer would be to try to nourish the spirit, not to demand suicide.

this is a bit of a side issue, but you can't alway do everything. I don't see longevity as a particularly important goal. I see quality of life as the key issue - not length of life. If we could all live to be 120 and still be climbing mountains then great. But the reality is far from that. Lot's of people find it preferable to stick their parents in a nursing home than to look after them. They're then given the full medical resources of the state to keep them ticking over until they finally die of boredom. I see that as a huge waste of resources.

I'd prefer to use resources to give people a more rounded life until the inevitable problems of old age kick in and then be brave enough to recognise that, after a certain stage, if you continue to pay for medical and nursing care, then you are just flogging a dead horse. Just because we have the medical knowledge to keep somebody alive for decades longer than nature intended, doesn't always mean that we should apply that knowledge.
sorry for diverting the discussion.

 

[catch]

Has to come back to the point where no matter how much money anyone has, their subsistence is dependent on labour - labour that if stopped would affect them within a few days (distribution if not production).

The elderly, kids, some other broad cross-class sectors of society are physically unable to subsist by their own labour. Many people who _are_ able to do so, still live off the labour of others. There's those who's income is derived from returns on capital or rent, and those who are forced (or possibly choose, but let's assume forced) to do completely unproductive or demonstrably damaging labour, or unemployed. Even manufacturing jobs might be making, say, paper for junk mail, or protein powder for pumping into 70% chicken; labour which is overall negative in its effect, completely irrational. Large bits of most jobs are useless, as are many jobs in-themselves.

By pointing out the vast numbers of people in this society who are supported by means other than their labour, and the vast amount of labour that is expended for no positive reason, the ratio of workers to pensioners seems much less important. Since pensioners (or those pensioners likely to be affected) actually contribute to wealth while they work rather than live their whole lives taking from it, it should be easy to point out the contradictions in the current arguments being put forward. Radio 4 last night had the same thing - obviously being pushed hard at the moment.

As to the UK's energy imports. All those people doing useless jobs are making useless commutes every day to jobs, using a lot of resources just for transport. Let alone all the paper that's pushed everywhere for no good reason - energy, labour and raw materials that could be put to use elsewhere. Plus the expenses of accommodation for businesses - which, again, could be used to provide a higher standard of living. If the only work done was that required to maintain everyone to a decent standard of living, without scarcity, you'd have both increased quality of life, and much less resource use. The main problem with pensions is not the amount of people working or not, it's that the income of the country is measured in GDP which isn't an accurate reflection of wealth - a large proportion of GDP is wasted resources.

 

[the B]

Hang on a second....while you could raise say £80 billion a year from taxing the rich...a necessary but in my opinion insufficient way of dealing with the pensions situation...

You still have at least £600 billion public and about £60 billion private pension holes to fill...for now...

And pensioners will require more money from other public services, notably healthcare.

Considering the ratio of workers to pensioners (with current retirement ages staying the same...) is set to become much more tricky (as in about 3 to 1 rather than the current about 4 to 1) - the general tax take falls sharply...

Taxing the rich will help but not do enough, there are very real problems with supporting the coming 'group' of pensioners.

 

[catch]

That was £80 billion enforcing existing taxation if I read it right the first time. Any additional taxes would add to that.

 

[the B]

Still a lot to catch up on...and that's just the pensions hole you get with it's currently peanuts provision...if you actually made it a decent living scheme, you'd be talking about doubling the pension (probably).

So...£1.2 trillion to be found?

 

[catch]

Say you instituted a pension of £10k/year.

£600 billion is £10k a year for 60 million people. That's not what get's paid out per year in pensions right?

£80 billion would pay for 8 million pensions. That's a lot no?

Or is either my brain or my calculator broken?

 

[the B]

There are 12 million pensioners (ish) who receive money from the government (most in this country, some abroad).

If they receive 10k a year (at current prices - and presumably one supports linking pension increases to wages...or just something above inflation....) that is £120 billion a year. The elderly also require large sums of money in other areas like healthcare.

The number of pensioners is set to rise, the number of people paying taxes to fall...

To give you an idea of what £120 billion gets you...the entire NHS is funded off around £90 billion a year. Depending on the time of year, the NHS is the world's third largest employer (behind the Peoples Republic of China Armed Forces, Wal-Mart and sometimes the Indian Railways).

 

[catch]

So in that case, Butcher's corporate tax evasion estimate would go a long way towards the £120 billion, plus existing income from tax/NI, plus any extra tax you'd put on the rich and corporations.

 

[the B]

Right...currently economic growth is pretty good (so is tax take).

How about when it isn't so good? And unemployment isn't at multi-decade lows?

And £40 billion a year short is a lot to make up for...

An amount short which will presumably increase because you support the idea that pensions should increase faster than the rate of inflation...

 

[ernestolynch]

How much do we spend on diplomats and their spoilt offspring?

 

[butchersapron]

And on top of that, this £80 billion should be added to the current sum being spent on pensions - it wouldn't replace this amount or be the total set aside for pension provision, it would be added on top of the existing pension. So there's simply no need to make the £10 000 per pensioner estimate. The extra money could be used to top up pensions to the £10 000 figure - so each person would be more likely to require significantly less than 10 grand - more in the order of a few thousand - so there's even more to go round.

 

[the B]

And on top of that, this £80 billion should be added to the current sum being spent on pensions - it wouldn't replace this amount or be the total set aside for pension provision, it would be added on top of the existing pension. So there's simply no need to make the £10 000 per pensioner estimate. The extra money could be used to top up pensions to the £10 000 figure - so each person would be more likely to require significantly less than 10 grand - more in the order of a few thousand - so there's even more to go round than the Bs inaccurate calculations realise.

There is no 'set aside' amount for pensions.

 

[the B]

And pensioners account for 41% of NHS expenditure, if the number of them increases...and as said, the tax take from other sources decreases what with less people able to work...

 

[ernestolynch]

 

[the B]

 

[butchersapron]

There is no 'set aside' amount for pensions.

That's totally irrelavent. This would still be £80 billion extra a year added to the established levels of money currently availible for pensions.

 

[ernestolynch]

Careful BA he might turn to page 272 of his Economics reader....

 

[the B]

Yeah, I agree - but I don't think it covers it all.

You've got a running cost of £120 billion on current pensioners if you go for £10k a year.

There will be more pensioners, there will be less tax take from other significant sources and there are other provisions that have to be given to the elderly other than just pensions (most significantly, healthcare costs).

 

[the B]

Careful BA he might turn to page 272 of his Economics reader....

 

[butchersapron]

Aye - I don't think i can be bothered with this tonight to be frank.

 

[ernestolynch]

Aye - I don't think i can be bothered with this tonight to be frank.

 

[catch]

I've worked for the NHS, fuck loads of money is spent paying people to fill out forms to monitor whether other forms are being filled out, logging both forms on another form, and on two different computer systems, then training people to fill out those forms, then doing it again three weeks later, in triplicate, for the same person ad nauseum.

Or on employing someone to tell you that you're not allowed to make more than 20 photocopies because the machine's overheating - that was their de facto full time job (oh, and putting paper in it).

And some ridiculous amount of infections being treated in NHS hospitals are contracted in hospitals, not looking it up now, but iirc it's more than 10%.

Plus all the money they'll be paying out for PFI for years to come.

 

[butchersapron]

The 'shortfall' is actually only projected to £56 Billion not £120 Billion - and not till 2050! - well within the amount that could be reclaimed by clamping down on tax avoidance - which also means that if a start is made on reaclaiming this money now it would be enough to cover the 'gap' for many years to come - it fact it would make the 'problem' dissapear for many years.

And even without this action being taken the state paying out an extra £57 Billion a year on pensions would still only bring us in line with most other european countries. It would be a increase of 7.5% of GDP over 50 years - something that is not out of the ordinary (it rose by 14% from 1930-45 - figures from New Statesman), and certainly not something that can accurately be labled as 'a crisis'.

I'd also point out that the author of the report was Adair Turner - an ex-head of the CBI. To look at this as an objective stand-alone 'economic' problem rather than part of a far broader political attack on the conditions of the w/c is utterly naive. It's not called Political Economy for nothing.

 

[Japey]

People seem to be ignoring the more fundamental issue - that pensions depend on the stock market and that it is a huge gamble to assume that the stock market will continue to grow indefinitely. Standard Life and the Maxwell pensions have shown that pensions are not a surefire way to a comfortable retirement. If the stock market does collapse or decline (and, given the inevitability of decling oil production, this seems fairly likely) then investing in a pensions scheme will be a big waste of money. Better off sticking it in a savings account where you'll have a bit of notice if anything happens.

 

[catch]

People seem to be ignoring the more fundamental issue - that pensions depend on the stock market

That's because we're talking about State pensions, which don't depend on the stock market, they depend on taxation.

The problem they claim with the State pension is that when you pay N.I. contributions, you're not paying into a pension account, you're directly paying for pensions which are going out now, hence the stock market has little to do with it.

Also, providing, shelter, food, goods and services for people (that's what the pension's for right, money's no good by itself, can't even burn credit cards effectively for heat), doesn't depend on the stock market, it depends on the forces of production and the distribution of wealth.

This was on Radio 4 _again_ last night. Almost every night of the week they've been going on about it.