The 2015 Popularity Contest (aka UK General Election )

[peteblue]

Pete, defined benefit schemes closed because companies and individuals could no longer fund the hugely costly benefits they promised. The costs were huge because we moved into a low interest rate environment causing Gilt yields to fall (universally seen as a positive) and much higher life expectancy than previously expected by actuaries.

Alternatively, of course, companies could have asked shareholders to stump up the cash to fix the gaping hole on their balance sheets caused by unfunded pension promises, thereby reducing equity prices and capital for future investment. I think not!

No mate, the £5Bn raid each year did for them. There was no debate beforehand about unsustainable pensions, in the private industry world......all the talk of higher life expectancy etc etc came about afterwards to try to prove why pensions should be lower.....Brown broke it, no one else to blame, and most economic commentators would agree. The man was a disaster, his credibility destroyed and it's recognised by his absence from public or private life........

 

[The Esk]

No mate, the £5Bn raid each year did for them. There was no debate beforehand about unsustainable pensions, in the private industry world......all the talk of higher life expectancy etc etc came about afterwards to try to prove why pensions should be lower.....Brown broke it, no one else to blame, and most economic commentators would agree. The man was a disaster, his credibility destroyed and it's recognised by his absence from public or private life........

Think you will find the cost of defined benefit schemes increased massively after the 1988 Income and Corporation Tax Act and the accounting standard SSAP 24 which forced Companies to properly account for the costs of providing benefits and placed statuatory maximums on pension fund surpluses.

There was a golden period to retire around that time, almost all of at huge expense to future retirees.

 

[peteblue]

Think you will find the cost of defined benefit schemes increased massively after the 1988 Income and Corporation Tax Act and the accounting standard SSAP 24 which forced Companies to properly account for the costs of providing benefits and placed statuatory maximums on pension fund surpluses.

There was a golden period to retire around that time, almost all of at huge expense to future retirees.

An old Guardian article......

'Public enemy number one'
Gordon Brown is "public enemy number one" when it comes to pensions. So says Peter Spencer, the chief adviser to an influential economic thinktank. A fair few people would probably agree with him.

The Conservatives have accused the chancellor of helping to cause Britain's pensions crisis by milking our retirement funds for extra tax revenue. They say Brown pushed the industry into turmoil by mounting a £5bn a year raid on pension funds when he removed tax credits from share dividends in 1997, hitting the value of the assets in pension funds.

But it's not just the opposition who have attacked the chancellor over his abolition of dividend tax credits. Mr Spencer, adviser to economic forecasting group the Ernst & Young Item Club, says: "It was an error of historic proportions. It may not sound very much but it's the difference between a rate of return on your savings of 4%-5% and 7%-8%."

Many other commentators also believe it was a bad move. The National Association of Pension Funds, representing company pension schemes, says that with the downturn in stock markets and an ageing population, losing around £5bn a year, which could be used by pension funds to help out their members "is obviously not going to help matters at all".

The CBI, the voice of business, also recently criticised the move for helping to drive up costs. Mr Brown has rejected claims that the abolition of dividend tax credits has caused havoc.

 

[The Esk]

An old Guardian article......

'Public enemy number one'
Gordon Brown is "public enemy number one" when it comes to pensions. So says Peter Spencer, the chief adviser to an influential economic thinktank. A fair few people would probably agree with him.

The Conservatives have accused the chancellor of helping to cause Britain's pensions crisis by milking our retirement funds for extra tax revenue. They say Brown pushed the industry into turmoil by mounting a £5bn a year raid on pension funds when he removed tax credits from share dividends in 1997, hitting the value of the assets in pension funds.

But it's not just the opposition who have attacked the chancellor over his abolition of dividend tax credits. Mr Spencer, adviser to economic forecasting group the Ernst & Young Item Club, says: "It was an error of historic proportions. It may not sound very much but it's the difference between a rate of return on your savings of 4%-5% and 7%-8%."

Many other commentators also believe it was a bad move. The National Association of Pension Funds, representing company pension schemes, says that with the downturn in stock markets and an ageing population, losing around £5bn a year, which could be used by pension funds to help out their members "is obviously not going to help matters at all".

The CBI, the voice of business, also recently criticised the move for helping to drive up costs. Mr Brown has rejected claims that the abolition of dividend tax credits has caused havoc.

Let me see, EY Item club, CBI and the NAPF, hardly unbiased in their opinions lol

 

[peteblue]

Let me see, EY Item club, CBI and the NAPF, hardly unbiased in their opinions lol

It was in the Guardian though.......... lol

 

[Ashtonian]

I said they don't have beliefs, not ideas. Their problem is that they have too many cunning ideas.......

I saw a good quote that went something like....... "If we argue about the things that we see differently we are going to spend our whole lives arguing, if we work on the things we agree on, we will spend our lives working.”

I agree with that sentiment. It is such a shame the people who should be working together do not even know everything that needs fixing.

 

[The Mighty Quint]

Just been a brilliant lady caller on The Wright Stuff who knew her onions.

She said Austerity is a complete myth, The Tories saying they need to make 30bn in cuts is bullshit, the government has spent £375bn on quantitative easing, equivalent to 10k spent for every man, woman and child in this country, and according to the office of national statistics 40% of that money benefited the top 5% wealthy in this country, so over 100bn was spent to keep the rich richer and protect their wealth, so why can't the government spend 30bn on the whole population to the benefit of everyone.

There is no lack of money, there is just a lack of will by the government to invest in infrastructure and the social security network that everybody actually pays into through national insurance etc.

Social security, not welfare, welfare makes it sound like charity, Social security is something we all already pay for, and for the likes of Osbourne to cut it and tell people they can't have this and can't have that is an outrage, the people have already paid for it, national insurance, it's an insurance system incase you need it, says what it is on the tin, but governments call it welfare like it's something for nothing.

The £375bn mentioned before could be called corporate welfare, why are we spending billions to prop up the very rich and then telling the general public we are going to keep cutting by 30bn.

It's time we all woke up to the sh*t they are shovelling.

 

[Bruce Wayne]

The government doesn't spend anything on QE as it's issued by the central bank.

http://www.bankofengland.co.uk/monetarypolicy/pages/qe/default.aspx

Oh, and national insurance was designed for the NHS. Last year it raised £110bn, which was £30bn less than the NHS budget, and half of the budget spent on social security (as you put it).

Apart from that though, she was probably right on the money.

 

[The Mighty Quint]

The government doesn't spend anything on QE as it's issued by the central bank.

http://www.bankofengland.co.uk/monetarypolicy/pages/qe/default.aspx

Oh, and national insurance was designed for the NHS. Last year it raised £110bn, which was £30bn less than the NHS budget, and half of the budget spent on social security (as you put it).

Apart from that though, she was probably right on the money.

So why doesn't the goverenment instruct the BoE to issue another 30bn then they would not have to insist on 30bn in cuts.

The Beveridge Report of 1942, (which identified five "Giant Evils" in society: squalor, ignorance, want, idleness and disease) essentially recommended a national, compulsory, flat rate insurance scheme which would combine health care, unemployment and retirement benefits. Beveridge himself was careful to emphasize that unemployment benefits should be held to a subsistence level, and after six months would be conditional on work or training, so as not to encourage abuse of the system.[1] After its victory in the United Kingdom general election, 1945 the Labour Party pledged to eradicate the Giant Evils, and undertook policy measures to provide for the people of the United Kingdom "from the cradle to the grave."

Included among the laws passed were the National Assistance Act 1948, National Insurance Act 1946, and National Insurance (Industrial Injuries) Act 1946.

And there were some very clever people on the panel plus the host who agreed with her and she got a big round of applause.

 

[The Mighty Quint]

@Bruce Wayne

The National Insurance Act 1946 was a BritishAct of Parliament which established a comprehensive system of social security throughout the United Kingdom

 

[Bruce Wayne]

So why doesn't the goverenment instruct the BoE to issue another 30bn then they would not have to insist on 30bn in cuts.

Printing money might provide a short-term filip but without a rise in productivity, all it does is increase inflation. If it didn't then the Bank of England could simply print as much money as they wanted and we'd all be on easy street.

The economy still appears so fragile, despite the increase in jobs that Osborne is so proud of, because productivity has gone down. Get that sorted and everything else would fall into place I'd have thought.

With QE, it primarily seems to benefit those with capital, as they're the ones that can actually borrow more, hence we've seen property owners do very nicely, but wages have stagnated because productivity hasn't risen.

Regarding National Insurance, it might have been affordable back in the 40s but it isn't any more. We're spending around 3 times on health and welfare what the government receives in NI.

A big chunk of that is in pensions, but given the demographics of the voting population, it'd be a brave politician that pledged to tack the retirement age to changes in life expectancy. We've seen how volatile even small proposed changes have been, let alone ones that are fair.

It gives us a situation whereby pensioners are pretty well off (thank you very much) and still insist on borrowing more money from future generations to pay for the nice things they get from the state today.

 

[toffee matt]

Just been a brilliant lady caller on The Wright Stuff who knew her onions.

She said Austerity is a complete myth, The Tories saying they need to make 30bn in cuts is bullshit, the government has spent £375bn on quantitative easing, equivalent to 10k spent for every man, woman and child in this country, and according to the office of national statistics 40% of that money benefited the top 5% wealthy in this country, so over 100bn was spent to keep the rich richer and protect their wealth, so why can't the government spend 30bn on the whole population to the benefit of everyone.

There is no lack of money, there is just a lack of will by the government to invest in infrastructure and the social security network that everybody actually pays into through national insurance etc.

Social security, not welfare, welfare makes it sound like charity, Social security is something we all already pay for, and for the likes of Osbourne to cut it and tell people they can't have this and can't have that is an outrage, the people have already paid for it, national insurance, it's an insurance system incase you need it, says what it is on the tin, but governments call it welfare like it's something for nothing.

The £375bn mentioned before could be called corporate welfare, why are we spending billions to prop up the very rich and then telling the general public we are going to keep cutting buy 30bn.

It's time we all woke up to the sh*t they are shovelling.

Theirs 100's of damning stats about the current government but QE is controlled independently by the Bank of England governing panal and was first introduced in 2009.

QE is decided by the monetary policy commission which was granted full independence in 1998

http://en.wikipedia.org/wiki/Monetary_Policy_Committee

 

[The Mighty Quint]

Theirs 100's of damning stats about the current government but QE is controlled independently by the Bank of England governing panal and was first introduced in 2009.

QE is decided by the monetary policy commission which was granted full independence in 1998

http://en.wikipedia.org/wiki/Monetary_Policy_Committee

So why has over 100bn of it only benefited the top 5% in the country according to the office for national statistics, if they can print an extra £375bn then why not make it £400bn put a bit into the governments coffers to make savage cutting of Social Security not needed.

 

[The Esk]

With QE, it primarily seems to benefit those with capital, as they're the ones that can actually borrow more, hence we've seen property owners do very nicely, but wages have stagnated because productivity hasn't risen.

QE benefits those with assets as the assets rise in value to compensate for the fall in value of money. More cash floating around then asset prices increase, resulting in those with assets becoming richer in balance sheet terms whilst those without assets have to pay more to acquire assets.

QE has happened in football over the last 20 years, and that's the easiest way to think of its effect - the clubs with wealthy owners move far away from those without and it becomes impossible to bridge the gap economically.

 

[Mrk]

Just been a brilliant lady caller on The Wright Stuff who knew her onions.

She said Austerity is a complete myth, The Tories saying they need to make 30bn in cuts is bullshit, the government has spent £375bn on quantitative easing, equivalent to 10k spent for every man, woman and child in this country, and according to the office of national statistics 40% of that money benefited the top 5% wealthy in this country, so over 100bn was spent to keep the rich richer and protect their wealth, so why can't the government spend 30bn on the whole population to the benefit of everyone.

There is no lack of money, there is just a lack of will by the government to invest in infrastructure and the social security network that everybody actually pays into through national insurance etc.

Social security, not welfare, welfare makes it sound like charity, Social security is something we all already pay for, and for the likes of Osbourne to cut it and tell people they can't have this and can't have that is an outrage, the people have already paid for it, national insurance, it's an insurance system incase you need it, says what it is on the tin, but governments call it welfare like it's something for nothing.

The £375bn mentioned before could be called corporate welfare, why are we spending billions to prop up the very rich and then telling the general public we are going to keep cutting by 30bn.

It's time we all woke up to the sh*t they are shovelling.

She clearly doesn't know her onions...