Council Tax for State Pensioners

Callistemon21

^Pragmatically, they could move to a home they can afford to heat and maintain^

It's not always feasible. In fact, often it is impossible to find anywhere.
Builders are not building modern bungalows which have enough space and a small garden because they are not cost-effective. Older properties are not always well-insulated or well-maintained and need money spending on them.
Not everyone wants to live in a retirement village.

I do understand that. But that is one of those difficult to solve problems. I don't think it can mean your maintain the assets of all the rich by paying them benefits or not charging them Council Tax.

I would think it is only a very small minority that can afford to live in a retirement village but there are other options.

volver3

I'm proud to pay more tax than the next person because life has been good to me and I can afford it, and because it shows that I live in a country full of people who look after the people who can't look after themselves.

Mainly.

... I live in a country full of people who look after the people who can't look after themselves.

Mmm. I have concluded that every party, big or small, wants the best for the people in our country. They differ in what they think is "the best". The exception is the Conservative Party, whose members and voters only want the best for themselves. I don't think that will ever change.

What some people don’t seem to realise is that it is not what they have paid in NI and taxes which they are the. “drawing on” in their retirement or old age, but what is being paid today by the working population and taxpayers of all ages (including most of us)

What you are describing here is a Ponzi system - one of the most corrupt and unstable of all organizational structures.

Its not the fault of todays pensioners that what they paid in over their working lives will not meet the cost of their pensions. Rather it is the result of poor forward planning by governments. These governments did not put a better system in place when they realised there was a demographic timebomb on the horizon.

People like myself can only see what they have put in over the years and the tremendous contribution they have made to the community. I also see the example set in that sleazepit called westminster. That makes me all the more determined to claw back what I can in whatever way I can.

Perhaps you could clarify that biglouis. You appear to accept that, as one of today’s pensioners, what you have paid in over your working life will not meet the cost of your pension (and any benefits you receive, being disabled, and medication and NHS treatment). Why, then, are you so determined to claw back all you can in whatever way you can? And what is this tremendous contribution you have made to the community?

I agree with some of biglouis's post, in that it is not the fault of our generation(s) if previous governments have not taken care of the economy and NHS. They had access to demographic and economic data, and it was their responsibility to manage the budgets so that there would be no deficit down the line. Instead they took pension holidays and continued with the a system of NI that they are now saying was inadequate, and are pulling out all the stops to tell us that this is because of generational inequality, that we should feel guilty and that young people should resent us. People have, (whether with good grace or not ) paid what was asked of us. It was never up to us to understand whether that would be enough, and even if we'd wanted to pay in more there has never been a mechanism by which we could do so. This means that it is the responsibility of the government to fix the problem, not the taxpayer, although we might all have to pay more to plug the gaps that mismanagement has created.

What I do not agree with is bl's approach to dealing with that, ie by clawing back as much as she can. As is well documented on here I don't approve of means-testing, but I absolutely believe that we should all pay whatever taxes are necessary to ensure that those unable to be 'economically active' are looked after, and that those who have more income (from whatever source) should pay more than those with less. Pensioners are probably a mixed category, in that many are no longer earning, but are all using services, so should be charged via taxation of some kind, unless there is a reason why they are unable to do so, at which point they start to get payback for the contributions made over the years. If that point never comes, so be it - it's a good position to be in.

Doodledog I agree with some of biglouis's post, in that it is not the fault of our generation(s) if previous governments have not taken care of the economy and NHS. They had access to demographic and economic data, and it was their responsibility to manage the budgets so that there would be no deficit down the line. Instead they took pension holidays and continued with the a system of NI that they are now saying was inadequate

Far wiser, imo, would be to admit the birth/longevity have changed causing the need for a better system. Poor planning.

I'm not sure I understand - wiser than what?

I did say that whilst it is the government's responsibility to solve things, the solution may (almost certainly will) be that we all have to pay more to put things right.

Doodledog

I'm not sure I understand - wiser than what?

I did say that whilst it is the government's responsibility to solve things, the solution may (almost certainly will) be that we all have to pay more to put things right.

It would have been wiser for the government to have always played the long game, counted on birth rates dropping and longevity of the population. I'm not sure to the solution, perhaps ending SP in 20 years or so, allowing the funds to dry up? But nothing to do with council tax, imo.

Do I understand correctly Norah that you feel state pension should end in about twenty years? The problem with that is that the younger generation who have been paying in for many years would no longer have a stake in paying at all, and there would be demands to end or reduce NI. Then what would those who rely on the benefit of a state pension be?

There are no funds to dry up though. And for those who have paid in for decades, it would be very unfair to let the pension phase out, whether or not the actual money they paid is sitting in a money box somewhere. The deal was that we paid for the previous generation in the knowledge that the next one would pay for us.

I agree that it would have been wiser for them to step in earlier, but that still doesn't make it the fault of the current generation of pensioners.

And yes, we have moved off the topic of council tax😀

maddyone

Do I understand correctly Norah that you feel state pension should end in about twenty years? The problem with that is that the younger generation who have been paying in for many years would no longer have a stake in paying at all, and there would be demands to end or reduce NI. Then what would those who rely on the benefit of a state pension be?

Yes, I think that perhaps SP could end in 20 years - there seems nothing being done to improve the balance sheet. The number of people being paid out is growing as the number paying in is shrinking.

I've no solution, I stated a thought.

I honestly think that would be the final straw for people who have paid tax and NI for many years, doing what the government has asked, and generally living law abiding lives. Many of us have already had 6 or more years added to our working lives, which for a lot of people has resulted in messed up retirement plans, and for many more has resulted in poverty. Being told that there will be no pension at all will give people no incentive to do the right thing, and the consensus on which our legal system depends will come under enormous strain.

It won't just affect older people either - if younger generations see how trust can be broken they will have no incentive to play the game either.

I can't see how they could stop it completely. People would die - lots of them, I imagine. They could, and are right-wing enough to be intending to do so, change to only an income-related benefit. They have talked about the Australian system. The only problem is that this was well planned so people had saved well into a private pension - by law. For some reason our government never followed through with this side.

I can't imagine that would go down well, but then I never thought they would get as far with dismantling so many other services.

DaisyAnne

I can't see how they could stop it completely. People would die - lots of them, I imagine. They could, and are right-wing enough to be intending to do so, change to only an income-related benefit. They have talked about the Australian system. The only problem is that this was well planned so people had saved well into a private pension - by law. For some reason our government never followed through with this side.

I can't imagine that would go down well, but then I never thought they would get as far with dismantling so many other services.

I can imagine that it could be means-tested, as it is in Australia. An elderly relative did receive the Australian Age Pension and it was more generous than ours but others were disgruntled because they didn't receive it, as assets, including your house contents and car, were taken into account.
I think your home is excluded.

Nothing would surprise me.

That's the problem. The change would put those who have managed to save just enough in an even worse position than now. Add to that the fact that we are not making people start paying into a pension from, I think, 17 and at a fairly high percentage as Australia does and, while all changeovers are unpopular for a period of time, ours would be even more challenging.

I think people might decide not to put into a pension scheme at all because they would know that there will absolutely have to be a benefit (call it whatever you like) that would provide for older people who are not working and they would feel, okay if I save myself you won’t pay me so I won’t save. Plus some people are such low earners that they couldn’t afford to save. And people wouldn’t want to pay into NI if they didn’t see a benefit to themselves at the end.
Anyway, haven’t the government made a contract with workers, you pay NI for 35 years and then we pay you the state pension?

If pensions were to be stopped in 20 years, it would affect people now in their late 40s, who are possibly already planning for retirement. I think there would be general uproar!

If there is going to be a wholesale change, it need to be in 50 years' time, which would affect people just starting their working lives and they would need to be adequately informed, so that they could make alternative arrangements.

People will only willingly contribute if they have a stake in the society they’re paying into. That’s why universal benefits work. Child benefit is no longer universal and I disagree with that too. It should be universal as should the state pension. I think there maybe more of an argument for reducing council tax for older people if there was no universal pension. As it is, I disagree with biglouis that council tax should be reduced for pensioners because everyone gets the pension, even if it’s better late than never.

Callistemon21

DaisyAnne

I can't see how they could stop it completely. People would die - lots of them, I imagine. They could, and are right-wing enough to be intending to do so, change to only an income-related benefit. They have talked about the Australian system. The only problem is that this was well planned so people had saved well into a private pension - by law. For some reason our government never followed through with this side.

I can't imagine that would go down well, but then I never thought they would get as far with dismantling so many other services.

I can imagine that it could be means-tested, as it is in Australia. An elderly relative did receive the Australian Age Pension and it was more generous than ours but others were disgruntled because they didn't receive it, as assets, including your house contents and car, were taken into account.
I think your home is excluded.

Nothing would surprise me.

To an extent, the state pension in the UK is already means-tested. People who haven't "earned" enough credit through NICs are eligible for Pension Credit, which is means tested, so everybody receives the same as if they had contributed, whether that comes from additional benefit or from a person's own savings/resources. It's a disincentive for people to contribute themselves.

Norah

maddyone

Do I understand correctly Norah that you feel state pension should end in about twenty years? The problem with that is that the younger generation who have been paying in for many years would no longer have a stake in paying at all, and there would be demands to end or reduce NI. Then what would those who rely on the benefit of a state pension be?

Yes, I think that perhaps SP could end in 20 years - there seems nothing being done to improve the balance sheet. The number of people being paid out is growing as the number paying in is shrinking.

I've no solution, I stated a thought.

Says a person who never worked outside the home and doesn't have to rely on a state pension as a major source of income.

growstuff Says a person who never worked outside the home and doesn't have to rely on a state pension as a major source of income.

Being a sahp isn't part to my opinion - SP system could be broken and could change drastically or be eliminated over the next years.

I would like to see the discount given to just two in a household.

That’s totally unrealistic. Even higher payments for families to make to fund the shortfall - and two-person households would include many highly paid childless professionals.

maddyone

People will only willingly contribute if they have a stake in the society they’re paying into. That’s why universal benefits work. Child benefit is no longer universal and I disagree with that too. It should be universal as should the state pension. I think there maybe more of an argument for reducing council tax for older people if there was no universal pension. As it is, I disagree with biglouis that council tax should be reduced for pensioners because everyone gets the pension, even if it’s better late than never.

This www.pensionfundsonline.co.uk/content/country-profiles/australia/80 tells you about the Australian system. It did seem to be what was in the minds of the government when we started with our Workplace Pension, but theirs are from age 17, whereas ours starts at from 22. Theirs also starts on an income of just under £3,000 a year whereas ours doesn't start until you earn £10,000 pa. This is called their Occupation Pension. Employers also contribute to this.

They also have a Public Pension. This is a non-contributary, means-tested pension which works as part of their benefits system. This makes more sense to me than our mixed and very complex contributory/none contributary system for State Pension.

Then they have the same third pillar as we do. Personal pensions that come from Retirement savings accounts (RSAs). These opperate in the same way as a private pension does here, although their tax rules may well be (I'm sure they are) different to ours.

Norah

growstuff Says a person who never worked outside the home and doesn't have to rely on a state pension as a major source of income.

Being a sahp isn't part to my opinion - SP system could be broken and could change drastically or be eliminated over the next years.

Have you any idea how much people look forward to retirement and receiving a state pension? How dare you suggest that people should receive nothing after working for 45+ years!