Pensions - You are on your own people
Telegraph | News | State 'will not dig pensioners out of poverty'
People will have to save more for their retirement and cannot expect the state to "dig them out of poverty" in their old age, David Blunkett, the Work and Pensions Secretary, said yesterday.
In his first speech since taking over the pensions portfolio, Mr Blunkett said he was looking at a "something for something" agenda.
It would transform the welfare state from the traditional view of a "safety net" to one that "enables and supports, but ensures people and families can take responsibility and key decisions for themselves".
Earlier, interviewed on BBC radio, Mr Blunkett said he wanted to build a "lasting consensus" for the next 50 years to tackle the pensions crisis. But he emphasised it would involve individuals saving for themselves.
"The issue is not tax versus saving, the question of how long people work. It is what people are prepared to do for themselves and how we as a Government support, enable, facilitate them doing it for themselves, so that we don't hand this over to the state and at the end of a working life say 'now dig us out of poverty'," Mr Blunkett said.
For the umpteenth bloody time... El Gordo started raiding our pension funds by £5 billion a year back in 1997. He did this by scrapping dividend tax relief on shares held by pension funds (god forbid there should be any money washing through the system that goes untaxed on a Labour Chancellor's watch).
I have seen estimates putting this figure closer to £6.5 billion a year. So over 8 years, El Gordo has pinched at least £40 billion from our private pensions.
You don't have to be a maths professor to work out that the loss of compound growth on £40 billion over the next few decades would be quite considerable.
If you are interested, here are some figures to mull:
According to new research by actuaries at Watson Wyatt, savers in the average with-profits fund who retired before Mr Brown's first Budget received nearly four times as much pension as those who saved the same sums but retire today. For example, they calculate that £200 a month paid into the average with-profits fund for 20 years would have produced a pension of more than £20,500 a year in 1997 but less than £5,800 today.
...
Today, according to accountants at Deloitte, Britain's 100 biggest companies suffer pensions deficits of about £65 billion between them. Put another way, they need an extra £30,000 for every single employee if they are to pay the pensions as promised.
As demonstrated, at least £40 billion of this £65 billion shortfall is down to El Gordo. If the pension funds had kept that £40 billion, then assuming they invested wisely (after all, that is their job), they might have taken a bloody big bite out of the remaining £25 billion shortfall.
This pension crisis was created by New Labour. For "Blazin' Visa" Blunkett to turn it around and tell us that we should not expect the state to 'dig us out of poverty' is a bit bloody rich.
El Gordo likes to pride himself on his record of lifting people out of poverty (or so he says). Don't kid yourselves people. He is doing this at the expense of the future generations of pensioners. He has created a pension crisis of massive proportions and we will have to pay for it. By that time though, he will be collecting his own pension and being paid a fortune on the after dinner speech circuit. Like he gives a shit.
People will have to save more for their retirement and cannot expect the state to "dig them out of poverty" in their old age, David Blunkett, the Work and Pensions Secretary, said yesterday.
In his first speech since taking over the pensions portfolio, Mr Blunkett said he was looking at a "something for something" agenda.
It would transform the welfare state from the traditional view of a "safety net" to one that "enables and supports, but ensures people and families can take responsibility and key decisions for themselves".
Earlier, interviewed on BBC radio, Mr Blunkett said he wanted to build a "lasting consensus" for the next 50 years to tackle the pensions crisis. But he emphasised it would involve individuals saving for themselves.
"The issue is not tax versus saving, the question of how long people work. It is what people are prepared to do for themselves and how we as a Government support, enable, facilitate them doing it for themselves, so that we don't hand this over to the state and at the end of a working life say 'now dig us out of poverty'," Mr Blunkett said.
For the umpteenth bloody time... El Gordo started raiding our pension funds by £5 billion a year back in 1997. He did this by scrapping dividend tax relief on shares held by pension funds (god forbid there should be any money washing through the system that goes untaxed on a Labour Chancellor's watch).
I have seen estimates putting this figure closer to £6.5 billion a year. So over 8 years, El Gordo has pinched at least £40 billion from our private pensions.
You don't have to be a maths professor to work out that the loss of compound growth on £40 billion over the next few decades would be quite considerable.
If you are interested, here are some figures to mull:
According to new research by actuaries at Watson Wyatt, savers in the average with-profits fund who retired before Mr Brown's first Budget received nearly four times as much pension as those who saved the same sums but retire today. For example, they calculate that £200 a month paid into the average with-profits fund for 20 years would have produced a pension of more than £20,500 a year in 1997 but less than £5,800 today.
...
Today, according to accountants at Deloitte, Britain's 100 biggest companies suffer pensions deficits of about £65 billion between them. Put another way, they need an extra £30,000 for every single employee if they are to pay the pensions as promised.
As demonstrated, at least £40 billion of this £65 billion shortfall is down to El Gordo. If the pension funds had kept that £40 billion, then assuming they invested wisely (after all, that is their job), they might have taken a bloody big bite out of the remaining £25 billion shortfall.
This pension crisis was created by New Labour. For "Blazin' Visa" Blunkett to turn it around and tell us that we should not expect the state to 'dig us out of poverty' is a bit bloody rich.
El Gordo likes to pride himself on his record of lifting people out of poverty (or so he says). Don't kid yourselves people. He is doing this at the expense of the future generations of pensioners. He has created a pension crisis of massive proportions and we will have to pay for it. By that time though, he will be collecting his own pension and being paid a fortune on the after dinner speech circuit. Like he gives a shit.
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