http://news.bbc.co.uk/1/hi/programmes/n ... 973814.stm


The retirement age should be climbing much faster than it is, and pension reform is urgent. The alternative is deep cuts in the state pension. Since many have little savings and have to rely on the state pension it will mean that the governments of the future will have a problem with pensioner poverty.

FFS what's the point? I mean most people won't have that much time left after stopping work before they die so what is the frackin point?

The French can see this, they're already protesting about a planned raising of retirement age from 60 to 62. I say again, what is the frackin point?

We just swallow everything in this country. Vive la revolution! It's time for a change, a big change, in how our society functions.

'tis very, very simple:

tax pensions!

since they didn't pay for 'em they should be taxed!

If gloomy gordon could take away tax relief on contributions, then this lot should feel free to tax the hell out of whatever is left, if pensioners receive more than the minimum living allowance then they should be taxed heavily to pay for the next generation's pensions - "simples". In fact there should be a special higher rate for pensions since they're not generating any stuff for society etc, etc...

I'm getting confused now, I'll get me coat...

Absolute classic. Where do you get the idea that pensions weren't paid for? Did you think that the money just magically appeared? And what made you think they weren't taxed?



You have this totally the wrong way round. The tax you pay (during your working life and on your pension) goes to pay for the previous generation's pensions and healthcare, not the future generation's.



Yes you are. Tax relief of pension contributions continues as it always has:-
http://www.hmrc.gov.uk/incometax/relief-pension.htm

Pension income has always been taxed, and still is:-
http://www.hmrc.gov.uk/pensioners/pension.htm

Current state pension levels (a little over £5k pa) fall below the current tax threshold of £7475, but if you have other income (say, a personal pension) then your state pension is included as income e.g. you have a state pension of £5k and a personal pension of £5k, your income is £10k, and you'll pay tax on £2525 (£10000-£7475).

Seriously, read up on this a bit:-
http://www.direct.gov.uk/en/Pensionsand ... /DG_183754

And start saving.

Pete

Taxing pensions might work but definitely not the way you describe.

Pension contributions are not taxed because they are a deferring of income sometimes for many years. Now when they get the money as a pension they will be taxed on it. They may have lost all their other income so their personal allowances might be completely free to give them a tax free pension. Though they have deferred that income for perhaps many years. Abolishing the age related allowance is fair though.

Gordon taxed the income of pension funds. So it is like they are already been taxed so why tax them again?

The simple changes that are needed are that people need to save considerably more than they have to be able to retire, and that includes company pensions. The discount rate of pension funds has historically been too high so that the amounts needed to be put aside to cover pensions has been insufficient. This has been as a result of mis-selling by insurance companies and actuaries trying to win business. They should be held legally liable for those losses. If that were the case you would find that contributions would be much higher and returns much lower. Also annuities for pensions are usually paid for by the insurance companies buying government bonds. So that when interest rates are ultra low the funds need to provide the same income are pathetic. If when interest rates are 10% you need a pension of £10,000 you could provide that with a pension pot of only £100 000. If interest rates are 0.5% then to provide that same income then you need a pension pot of £2 000 000. This is what has devastated pensions recently. Interest rates are simply too low. If you have a final salary scheme then you are committed to that £10 000 pension but might have only had put away £100 000 so you would have a deficit of £1 900 000 on that one pension alone. With governments having a low interest rate policy this will destroy the pensions industry. That is one big single reason why people cannot retire.

I suspect robin was taking the p1ss somehow

I am 23.

When I am 73 I expect there to be:

- No public pension.
- Crap private pensions.
- Still working.

I expect my "retirement" will only come when either I fall down and die or don't wake up.

well spotted old fruit

If the state does not provide one at retirement then all the social improvements over centuries will have been lost and as a nation we will be a lot poorer for it.

What is needed is to make sure that pensions are worth saving for. The best way is to clamp down on pension running costs. Limit charges to 0.5% per year. That way the returns will be reinvested back into the pension rather than siphoned off by the insurance company shareholders. With a cap on fees it would stop them from churning the assets to generate additional fee income.

Mandate much higher mandatory contributions by employers and employees. 50% payable by staff.

Minimum contribution 30% of salary for defined contribution schemes (15% staff, 15% employer), more flexibility for defined benefit schemes. That will save defined benefit schemes

Have a single pension fund for all staff including directors and avoid scandals like the Phoenix collapse.

Part-timers to have pensions entitlements. More essential if companies are to not avoid their liabilities, dumping them on the state.

Directors to be banned from separate schemes. That way they have to ensure that all pension savers are in the same position. If the pension funds are insufficient they suffer along with the staff.

Change company law so that companies that take over another must make good any pension deficits within one year. That will provide protection for staff in event of a take over.

An internal account change that splits all pension funds into retirement years, With all those retiring in 2011 being in the 2011 fund. With that the low risk assets being held according to how close to retirement the fund is. So a fund that is due to close because it is in the retirement zone ie a 2010 fund would be nearly all cash and safe investments and also less at risk of falling in value if there were a stock market crash tomorrow. Those funds for retirement in 2041 will be all shares, as they would have enough time to make up any losses. it would substantially reduce the risk of a person or groups pension pot being wiped out by a stock market crash the day before retirement.

Also get rid of the annual cap on contributions. While this might mean that the tax man might lose tax revenue one year they do not lose overall. Have lifetime cap on contributions instead. So if you win the lottery you could top up your pension for life.