Out of interest, do you know how much money would be saved if all public sector workers were encouraged to retire at 65, like those of us relying on our NI contributed State Pensions?
Secondly if this money were then used to increase everyone's basic state pension, how much would it represent per pensioner per week?
I'd be happier if the state did have a completely transparent fund for all public sector workers, so that those staff who draw the pension were aware of the % contribution on top of their gross income that it costs the taxpayer to provide it. More importantly that the taxpayer would know the true cost and package of these benefits (it may even attract more people whose families aren't already in the know to apply for these jobs).
Benefits gained from pensions to MP's and other top earning civil servants should attract the same tax as that levied now on earnings from private sector pension pots over £1.5m, those introducing these rules should be taxed personally by the same rule.
Tracy- you're quite right about needing the same rules for all. And unfunded schemes pose a nice valuation question for the new pensions tax regime.
Actually I'm not quite sure what we'd save by moving back public sector pension age to 65- a good question and I will find out.
One aspect of the government's reasons for not moving the public sector retirement age up to 65 is not often commented on.
The unemployment figures in recent years have been held down by rampant public sector recruitment. If people were to suddenly stop retiring at 60 and work until 65, there would be no need to recruit their replacements for another 5 years. All of a sudden, recruitment would slow and the unemployment figures would head upwards.
Of course, in the long term it would be beneficial, but we all know that this government is not interested in the long term.
"[Means Testing] disincentivises personal savings, leading to higher public spending in the long-term, and a spiral of dependency.":Wat Tyler
Not often do you hear, "When your my age my boy you can live on means tested benefits so don't waste your money on a personal pension".
I don't have a personal pension because (until the last budget) the tax saving on the contributions maximum was eaten by the management costs and the lottery of the value at maturity. Then I would be forced to buy an annuity and annuities are theft. In fact it is the corrupt pensions industry that promotes personal savings (mostly in property in the UK). Many people like to control their own investment for their old age which is why the 'pension crisis' is not such a crisis as it might appear.
Commenting by HaloScan
