Member Info for Dorfan

LTI

In principal I would agree with you that it shouldn’t matter if you get the old or new pension that any serps etc should be treated as a separate entity and added on top.

I can only relate to a conversation with another person and the experience they are having.

Hardup

She said she was in serps because she wanted an enhanced pension. She did contact the pension department and they told her that because the new pension would be more than the old pension plus her contributions then she would not get any more.

LTI

So are you saying that if you paid into serps and get £185 and another person that didn’t pay serps also gets £185 is just. A simple yes or no is all that is required.

Hardup

This just makes it more confusing as it is another friend of ours who retires in two years, has paid serps in the past and her projection is based on the current £185 with more than 35 qualifying years.

LTI
no it's not lost - serps payments were ceased - those retiring before 2016 will get a second state pension based on Serps during their working life.
The new state pension is based on 35 years of NI contributions as opposed to the pre 2016 basic state pension of 30 years.

I am going to be repeating myself here, if you retire after 2016 on the new pension of say £185 and paid in the past to serps then you don’t get anymore. If you had not paid into serps you would still get £185 if you had the qualifying years in both cases. So there was no benefit to paying into serps in the past, but at the time people were not to know about the significant changes.
Although the money is not lost as you say those serps payments were just absorbed into the coffers of the government of the day. But the losers are those that made those payments because in reality they didn’t need to. How many thousands of pounds have individuals given to the government over the years?

Gazz

We have a friend who is 67 now and she was PAYE for about ten years and then set up her own company until retirement. Her SP when we spoke a while back was roughly the same as yours, so I suspect the rules are different if you were not PAYE all the time.

Gazz

We’re you PAYE all the time?

LTI
The majority of current pensioners will not even be getting the new state pension maximum of £185 per week let alone any historical additions.

For all those people that paid into SERPs years ago it is money lost. The government takes the stance that the new state pension is more than the combined old pension plus SERPs so therefore you are not losing out. Yet some people will get the new max without paying any additional payments which to me makes it unfair for those that did. There is no mechanism to claim it back so is it theft by stealth by the government?

LTL
why do you go on?

Because you didn’t grasp what I was saying right from the beginning.

I agree it is part of a total income of various sources but as I mentioned the government pays it in full first and the balance of the PA left over is then used to calculate the tax implications on the other incomes. I never said it was a tax free income.

LTI
Yes, meaning the state pension would have been taxed

No, state pension is paid before any other income and any allowance left is then used to calculate the tax implications on any other income.

If you read TFE he says the same

LTI
The UK state pension is already a taxable source of income when over the income allowance after adding it to other income.

I am not collecting mine yet but I was told that the state pension is paid first and then any other incomes like personnel pensions and paid income is adjusted accordingly afterwards. So that would mean currently the SP is paid tax free but……..

I did some messing around of calculations based on different inflation figures and the triple lock still being honoured up to 2028 which is when the current personal allowance is locked into.
Depending on various figures I used the state pension could sneak in under the allowance but if by some chance inflation does remain relatively high for the next couple of years at least then there is a good chance that the state pension will be higher than the allowance which will then I assume be taxed. I guess that this will be a first to happen if this becomes reality.

JCB208
At least they got it right this time. I think 4% will be about it for a while ,energy prices are falling fast so inflation will be coming down soon

What are the chances inflation will still be near 9-10% this September for the state pension review and what are the chances of the triple lock being honoured again. Just prepping for when I get to claiming it at some point in the future.

Musician

Labour's 10 most notorious IT failures is equivalent to more than half of the budget for Britain's schools in 2009. Parliament's spending watchdog described the projects as "fundamentally flawed" and blamed ministers for "stupendous incompetence" in managing them.

As I remember it was labour and Blair that promoted bringing in Doctors and nurses from abroad because they were already trained. Blair didn’t want to fund the training of indigenous people because of the cost. So we then had people from the EU and rest of the world coming here. To Blair it was a cost saving exercise.

So now we have an opportunity to start training people here but it takes time and positions will not be filled immediately.

Then we remember the HGV drivers who claimed to be self employed but working for one employer, the government stopped that loophole and many started to go back to the EU before Brexit happened. Again it takes time to train for an HGV license. I don’t here anymore of HGV a driver shortages, is there still a shortage or not?

Guitarsolo

I lifted this from the IMF website, no mention of Brexit that I can see.

MR. GOURINCHAS: Yeah. So, UK economy actually so let me start with the good news. The UK economy’s actually done relatively well in last year. We have revised upwards economic growth in the UK to 4.1 percent. That’s a 0.5 percentage point revision. And it’s one of the highest growth rates in Europe in that region for that year.

It is true that we are expecting a fairly sharp slowdown in this year. We’re projecting a growth that is -0.6 percent for the year. And that’s a downward revision of 0.9 percentage point. And there are basically three things that are behind this downward revision, and especially the fact that the UK is expected to do somewhat worse than some other countries in the region.

First, there is the exposure to natural gas. And we’ve had a very sharp increase in natural gas prices, energy prices in the UK. And there is a larger share of energy that is coming from natural gas with a higher passthrough to final consumers. And so, that has affected -- there’s been a stronger cost of living crisis, if you want, in the UK.

The second is that the UK also its employment levels have not recovered to pre-pandemic levels. So, this is a situation where you have a very, very tight labor market but you have an economy that has not reabsorbed back into employment as many people as it had before. And of course that means there is less output, less production.

And the third is that there is a sharp monetary tightening because inflation has been very elevated. That’s a side effect of this high passthrough of energy prices. Inflation was 9.1 percent last year. And it’s expected to actually remain quite high in this coming year at 8.2 percent. The Bank of England has started tightening. The UK has a fairly high share of adjustable rate mortgages. So, when The Bank of England starts increasing rates, it feeds into the mortgage rates that mortgage holders are paying. And that is also weighing down on activity.

So, all these three factors together explain why we have a somewhat sharper adjustment in 2023, but on the back of a relatively stronger growth in 2022.

Guitarsolo

From the BBC
The IMF, which works to stabilise economic growth, said it had downgraded its forecast for the UK because of its high energy prices, rising mortgage costs and increased taxes, as well as persistent worker shortages. It did not mention Brexit in its report as a factor for the UK not performing as well as others.

And the 1990’s was down to the US again and the ERM

Let us not forget we had recessions in 1980/81, 1990/91 and 2008/09.