Tag Archives: state

When I’m 64…

I saw this BBC report on French protests about the retirement age being raised to 62. Of course, the typical French disdain for England is annoying – the same old stereotypes being dredged up by French protestors.

But the real point applies to France and England – and most of Western Europe equally – who is going to be paying the state pension by the time I ‘retire’? I personally think that the concept of the third age, rather than a retirement, will have become normal by the time I am 65.

By third age, I mean it will be normal to enter into a new career, to use your life experience working with a charity, or working on the local council… doing something useful that is still work and probably still pays something – though far less than you would have earned during your main career. But by that time most of us won’t have a need to support kids or a mortgage anymore, so income requirements should be more modest anyway.

What I don’t expect is that I can hit the age of 65 and suddenly put my feet up and retire from work, to live out the next 20 years on the golf course.

In Britain, it’s the present taxpayers who pay the state pension through their tax. The older people claiming pensions will suggest that they have paid into their NI pot and now they are just claiming it back, but there is no bank account they are paying into, it’s the young workers paying their pension. The stakeholder pension was the first step towards trying to shift people to a sense of personal responsibility for their old age, but I’m not sure I have met anyone who actually has a stakeholder pension.

Perhaps it sounds too harsh and ‘Anglo-Saxon’ to suggest that personal responsibility needs to make a return – rather than a blind reliance on the state, but European demographics are not favourable. There will be far more old people as I age and fewer young workers paying income tax. Immigration would be the only real solution and yet that’s not something most politicians are welcoming either…

If you are ‘retiring’ 20 or 30 years from now then don’t look to the state to pay for your every need. Or if you think that’s an unreasonable assumption to make, then get out on the street and throw a few bricks – like the French.
Entire family over 100

The Pope in Britain

I’m a Catholic because I’m half-Irish-half-English and, as my dad isn’t much of a believer, I ended up getting baptised – not that I actually go to church. My attendance record is pretty much based on weddings and funerals.

But, when I was asked if I would be interested in working with the government Cabinet Office to follow Pope Benedict around the UK during his visit, providing live commentary via Twitter and blogs, I jumped at the chance. Though I’m not a follower, the teachings of his church have permeated their way into my consciousness just because I was always surrounded by Catholics when I was growing up – and who wouldn’t want to be embedded with a head of state providing a live Twitter feed of what really happens ‘backstage’?

But it was the former Prime Minister, Gordon Brown, who invited the Pope to the UK. And Brown is no longer in office. And the current Prime Minister is either less interested in the Pope visiting, or more attuned to the scandal that will be caused by his visit. Most probably the latter as the child sex scandal furore only seems to be getting worse and the present Pope was previously in charge of handling complaints against the Vatican, and should therefore be acutely aware of the issues – and be handling them rather better.

So the regular media will continue to cover the visit, but all additional nice-to-have coverage (like a live blogger backstage) were all canned.

It’s a shame as I was looking forward to trying to offer some insights. The views of the church often rub directly against my own liberal opinions – I was working in Malta last week and I was surprised to hear that divorce is illegal there because the church won’t allow it. The Catholic church has some way to go to reach the standards considered acceptable in a modern-day society where free expression and respect for Human Rights are considered essential.

But the church has an immense history and tradition and is followed by hundreds of millions of people. I was looking forward to exploring these questions of how faith collides with modernity, but now I won’t get the chance anyway. Another thing I can blame on David Cameron.

What a shame.
Art installation, Central St Martin's

SERPS Question

OK, this is one for all you financial advisors out there.

My father is just hitting 65 soon. He already has a pension from a company he worked for – which was for about 23 years from 1979. That company pension was partially money the company put in and partially payments he made in addition.

So he is getting that pension from the company anyway, as he retired early.

Now his state pension is due to start. He got a letter from the DWP people explaining that they are going to pay his pension from September, but it will mean he will get a deduction of almost exactly the same amount from his company pension. They said it’s because he contracted out of SERPS.

The biggest question I have here though, is when was it possible to contract out? And secondly, he was working from the early 60s… there is another 20 years of work and NI payments not connected to this job, so how come the state pension does not reflect that?