Friday, December 01, 2006

Pensionable age

Chris Dillow reports on a study that claims that the government's plan to raise the retirement age will be inequitable.
Sarah Smith points out that the rich live longer than the poor. Life expectancy at 65 is another 17.5 years for social class I, but only 13.4 for social class V. Raising the retirement age therefore reduces the value of a pension more for the poor than for the rich.

And uprating the pension in line with earnings rather than prices benefits the rich more, as their greater longevity means that they gain more from the power of compounding (assuming earnings rise faster than prices).

Just so that nobody confuses me with someone who gives a shit, my answer to this is: yeah. And. So. What?

Who cares is raising the retirement age "reduces the value of a pension more for the poor than for the rich", as long as that person has enough to live on. That is what a pension is supposed to be, isn't it? An income to live off, not a lump sum that all should be able to spend as they like.

Besides, the rich—by definition—pay more into their pensions than the poor anyway (in terms of hard cash, not as a proportion of income). And the raising of the retirement age will allow the poor that many more years (and it is the last few years of pension fund accrual that really makes the difference) to pay for a reasonable pension income. Seems fair to me.
What' s more, she says, raising the retirement age might not save much money. This is because many people stop working before retirement age because of ill-health. Increasing the retirement age therefore merely means people will claim incapacity benefit for longer.

Well, it is certainly true that a staggeringly high proportion of public sector workers—and we are including civil service paper-pushers here—do retire long before the compulsory retirement age, but then that is because they get a ludicrously good deal which, whilst funded by the private sector, is unavailable to those in the wealth-creation sector.

One notices that the retirement age for public sector workers is not going to rise about 65, and they will still get their ludicrously generous (and utterly unfunded) pension schemes, courtesy of the rest of us. What a bunch of cunts.

13 comments:

Rigger Mortice said...

sorry DV have reread it,you are right.The NI pool is a myth

Anonymous said...

Well, those poor public sector workers need lots of time off, early retirement and big pensions because of the stress of dealing with the rest of us morons. How is it that we continue to stubbornly undervalue these saints? How is it tht we cannot accept that they know what is best for us?

Pete in Dunbar said...

Local Authority pensions are not unfunded - contributions are paid into a fund, and the pensions are paid out of it. Now admittedly all of that money (whether from employee or employer) is public money, and thus in essence sourced in tax somewhere, but it is invested in a fund - and that's where the pensions are paid from.

Not sure about any of the other public sector schemes, but the Civil Service scheme is definitely just paid out of government current revenue.

"Life expectancy at 65 is another 17.5 years for social class I, but only 13.4 for social class V"

Perhaps to ensure equality of outcome we should all be executed when we reach 78 years 146 days.

james higham said...

And what about the self-employed, like me, who have no fund of any kind?

Frank P said...

james higham

There are plenty of poorly paid, pensionable jobs available in public service, which a man even with your paucity of reasoning powers could easily fulfil. I suggest that you close your business and apply for a job as, for example, a nurse, if you think that you are hard-done-by. 'Self employed' whingers come a very close second to welfare wankers. If you are a good business-man, one day, when you have had enough, you will sell your business for a spanking great profit and live in comfort for the rest of your life. If you're no fucking good, then you have a very stupid employer who is overpaying you and deserves to go bust. The grass is always greener ....

>"And what about the self-employed, like me, who have no fund of any kind?"<

I think the clinical term is 'myopia'!

Anonymous said...

Not all self-employed peeps are whingers you know.

Anonymous said...

No, just most of them.

PDF

Devil's Kitchen said...

James,

And what about the self-employed, like me, who have no fund of any kind?

Well, I'm afraid that you are the kind of short-sighted person that we've all been talking about. Suggest that you start paying large amounts into a private pension fund as from tomorrow...

I have never had a pension provideed by an employer (always worked for too small a company) and yet I have a pension; I wonder how that came about...?

DK

Umbongo said...

Earning a self-employed living usually means (at least) two things 1. you're providing a service which people are freely willing to pay for and 2. you are self-reliant. It doesn't necessarily mean (according to frank p's understanding)that you'll make a fortune. The subtle difference between self-employment and public sector employment is that IF YOU'RE SELF EMPLOYED AND YOU'RE CRAP YOU (metaphorically) STARVE - IF YOU'RE IN A PUBLIC SECTOR JOB AND YOU'RE CRAP AND YOU'RE UNLUCKY, NOTHING HAPPENS (IF YOU'RE LUCKY YOU'RE PROMOTED ANYWAY).

Frank P said...

umbongo

>"The subtle difference between self-employment and public sector employment is that IF YOU'RE SELF EMPLOYED AND YOU'RE CRAP YOU (metaphorically) STARVE - "<

Or ... you declare yourself bankrupt and leave your creditors in the crap, then start up another scam until you get found out then go bankrupt again ...

"If you're in a public sector job and unlucky ..."

The chances are you will be wiping the arses and cleaning up the puke of both welfare wankers who have spent their welfare payments on excessive booze or illegal substances and hedonistic libertarians who indulge in the same destructive behaviour and think it is their bounden right to receive assistance from 'highly paid' public service workers with 'excessive' pensions. There are useless corrupt cunts in all sectors and stratas of society. One should avoid generalising.

Frank P said...

PS

And putting bullshit in upper case makes it no more valid that in lower case.

AntiCitizenOne said...

Might I suggest anyone without a pension look into getting a (execution-only have very low charges) SIPP?

The aim for your pension should be to get an annuity income at just above the zero tax band, after taking the 25% tax-free (the only reason to save via a pension)

You should probably hide your real savings over-seas.

Pascal said...

Frank p,

the crucial difference between a private sector twat and a public sector one, is that I have no choice but pay for the latter.

And they don't even have to wipe my arse or clean my puke.