The Labour Government

[hampshireblue]

Sorry to be making a political point but genuinely it is the case that Gordon Brown fucked over private pension schemes with his tax raid on them, effectively ending final salary schemes by rendering them unaffordable. Prior to this it was wonderful that you could usually expect n 40ths of you final salary where n was your years of service. It meant many people were able to retire at ages and with pensions most of us could only dream of.

A few years back it was reckoned that Brown's raid had cost private sector workers on average £200,000 each in lost pension growth over the period. It will be more than that now.

I'm also sorry to make a political point, but this was a process started by Norman Lamont in 1993...just saying!

 

[Chippy_boy]

I'm also sorry to make a political point, but this was a process started by Norman Lamont in 1993...just saying!

Do you have anything to support that claim? Interesting if true but I am highly skeptical. For the past 15 years+ the media has been reporting Brown's calamitous raid on pension funds, not Lamont's.

 

[BlueHammer85]

Sorry the Rwandan plan is being taken over by the Germans and we are paying not positive.
Sorted the trains and doctors caved in to the unions we all know what happens next when the next union wants a pay rise.Not positive.

Farage far right riots let out criminals who have reoffended i agree the rioters want locking up.

Gb energy is nevef going to work do your research just going to push bills up even more not positive.

I have yet to be convinced on water as my supplier wants to put my bill up £500 a year.

Covid is finished move on.

Winter fuel payments not positive.
Taxing pensions not positive.
Vat on school fees when they are not using state school not positive.

Inheritance tax will be going up why when my wife and i have worked hard to own our own home should my Daughter pay tax on what has been taxed already.

They are tory light with the odd hardline labour policy.

Political system is fucked still at least we will only have them for 5 yrs.

In the debates Sunak told him he would put taxes up and stuff pensioners.The toolmakers son said it was not true and we should watch this space he lied.

Just wait till the budget.

Ok, so Labour should have carried on wasting billions on a Rwandan scheme that was never going to work, they shouldn't have 'caved' into the unions and just let doctors and trains carry on striking resulting in billions of loss for the economy whilst people in the health sector move abroad for better pay.
They shouldn't have locked up the rioters and those who instigated it, just let them burn hotels and carry on the violence.
Let our energy suppliers to continue to rip us off without looking to future investment.
Not bother coming down hard on the water companies.
Not bother trying to recoup the lost billions in fraud and dodgy contracts during covid, forget all that, move on.

So basically just bring back the Tories.

 

[Chippy_boy]

Lol

It's not even remotely funny. Just look at the post directly below your LOL. You lot are in cloud cuckoo land, you really are. I guess that's what 14 years in the wilderness does for people. When they finally surface they are all crackers.

 

[hampshireblue]

I fundamentally, completely, disagree with you.

My employer pays ME to do work for them. They give ME the money. The government does not have any of its own money, only money it takes off working people like me. They take money that my employer pays ME and grab some of it for themselves. It does not become THEIR money when they do that. It is OUR money, that they are using to fund XYZ.

Similarly a thief cannot say this is MY money when he has stolen money off you. It is YOUR money that the thief has stolen. It is not the thiefs money.

Now everyone accepts that we need a level of taxation to pay for public services and that is fine. But please do not fall into the trap of thinking that the government is spending its own money. It isn't. It is spending your, and other taxpayers, money.

But does he get a full day's work out of you?-I'd say no bearing in mind how much time you spend on here.

 

[Phil1]

It's not even remotely funny. Just look at the post directly below your LOL. You lot are in cloud cuckoo land, you really are. I guess that's what 14 years in the wilderness does for people. When they finally surface they are all crackers.

The post you refer to is just a carbon copy of the shite you’ve been passing off for the last 3 months.
Predictable and sad, yet you have the fucking audacity to claim others are crackers.

 

[hampshireblue]

Do you have anything to support that claim? Interesting if true but I am highly skeptical. For the past 15 years+ the media has been reporting Brown's calamitous raid on pension funds, not Lamont's.

Not a claim-it was well known at the time but as usual the right wing press ignores fairly significant acts in what is a process that, with hindsight, had unintended consequences. But pension holidays. enjoyed by the employers, had a far greater effect on the long term success, particularly of DB schemes. my own company enjoyed 5 years' worth of no contributions. With a bit of foresight, our union of which I was on the branch exec, negoitated a deal whereby the staff shared the savings by turning the accrual rate from 40/60ths to 40/58ths. But anyway here you go:

Taxation of Surpluses and Pension Holidays Back in 1988 Nigel Lawson decided to tax pension fund "surpluses" to prevent companies using the pension funds as a money box for tax avoidance purposes. This tax threat subsequently led companies to adopt a much tighter rein on the pension funds on the grounds that they had to "use it or lose it" to the Inland Revenue. However the IR valuation above which tax would be levied was made on a much more conservative basis than that used for the Minimum Funding Requirement valuation so there was really no justification to run the funding level right down to the MFR which many companies were doing. (In any case only about 30 pension funds out of the 100,000 schemes had ever been taxed under these rules.) During the early 90s companies were using these alleged surpluses for "industrial restructuring", i e offering very generous early retirement schemes to employees in their 50s for "downsizing" or so that they could be replaced by younger less expensive recruits. In the late 90s when the equity market was booming the companies also awarded themselves "contribution holidays" which in some cases were later extended to their employees as well. This meant that labour costs were held artificially low and those companies thereby gained a market advantage and greater profits which in turn boosted share prices. Not paying any contributions into the pension schemes soon became the norm, a habit it proved difficult to break. The right of companies to use their fund's "surpluses" in this way was challenged in the courts by pensioners but although they won in the High Court and the Court of Appeal this was eventually overtunred by the House of Lords decision in 2001. As far as the pension funds were concerned it would have been much wiser to allow the surpluses to build up in anticipation for the inevitable fall in the stock market. It is estimated that the long-term impact of the contribution holidays from 1987 onwards amounted to £18.5bn and has accounted for around 30 per cent of the current deficit in pension funding. In at least one instance a company in purchasing another one along with its pension scheme was able to siphon off more than it paid for the company in the first place and the pension scheme now has a deficit which exceeds that sum whereas if the holidays not been taken it would not be in deficit now.	The Causes of Closure​ Taxation of Surpluses and Pension Holidays "£5 billion Pound Raid" Minimum Funding Requirement Stock market crashes Accounting Standards Increased longevity Actuaries Increased management costs Restrictions on top hat pensions Pension Protection Fund It is estimated that the long-term impact of the contribution holidays from 1987 onwards amounted to £18.5bn and has accounted for around 30 per cent of the current deficit in pension funding. See also: ONS podcast on scheme membership (22 June '11) BBC MoneyBox "The Death of Final salary Schemes" (28 April '11) and Selected Statistics on Occupational Pension Schemes
"The £5 billion Pound Raid" In 1993 Norman Lamont reduced the value of tax credit on share dividend payments for pension schemes to 25% which later provided Gordon Brown with the idea of abolishing it altogether. This he did as soon as Labour came into office in 1997. The CBI welcomed the move though the consultants, Arthur Andersen, had spelt out the possible dangers for pension schemes to the Treasury. At the same time the new Chancellor reduced the Advanced Corporation Tax (ACT) paid by companies, perhaps believing that companies might pass some of this saving to the pension funds to compensate the latter for the loss of the tax credit income. That just didn't happen of course but in any event on average individual pension funds have suffered a loss of less than 0.5% a year which is insignificant when compared with the losses due to the over-exposure of most funds to falls in the value of equities. Furthermore as Paul Myners pointed out this is also roughly the amount of money wasted on transaction costs by pension funds. However the removal of ACT relief did turn out to be a death blow for many smaller pension schemes which were struggling in 2000 to 2003 and whose sponsoring employers could not benefit from the supposedly offsetting corporation tax cut as they were not making much if any profit.	Norman Lamont followed by Gordon Brown
The Minimum Funding Requirement The 1995 Pensions Act had introduced the "Minimum Funding Requirement" for occupational pension schemes as a result of the Robert Maxwell pension scandal. Its very name induced people to believe that henceforth their scheme assets were safe from predators like Maxwell if it was "fully funded" on the MFR. Although the Institute of Actuaries quietly pointed out that this was in actual fact far from being the case, by allowing "surpluses" to be defined in an over-optimistic way it encouraged the culture of extensive contribution holidays. This situation was then made worse by the present government, following pressure from the NAPF, by actually reducing the MFR level by up to 19% in 1998 and by a further 8% in March, 2002. This move was designed to ease some of the pain caused by the removal of the dividend tax credits in 1997. The MFR funding requirement typically then covered no more than about 50% of the guaranteed liabilities. Thus pension fund assets were reduced to levels which no longer matched the liabilities and when the stock market fell between 2000 and 2003 companies faced the prospect of having to pay huge sums to restore even this lowered MFR level. Belatedly in September 2005 the Pensions Act 2004 replaced the MFR by a "scheme specific funding requirement" to ensure that pension funds are maintained at a more realistic level in future.	Robert Maxwell​
Stock Market Crashes: 2000-2003 and 2008-2009 In 2000 the average pension fund had 60-70% of its assets invested in equities with some even investing up to 90%. This is on the grounds that in the long-term, they will generate higher growth than the alternatives such as corporate bonds and government gilts. The greater the investment returns the less the company then has to provide in contributions to the fund. However, the reason equities have higher returns than bonds is that they have higher risks. In 2001 the Boots pension fund moved all its assets into bonds to protect them from the coming fall in share values which many analysts predicted. In general though most fund trustees continued to follow their investment managers' advice to maintain high levels of equities, this type of investment being hugely profitable for them. At the peak the UK pension funds held a total of about £800 billion of assets of which about 70% was in equities and the total assets value dropped by about 30% to about £560 billion. Following the recovery in 2004-2007 some funds did make small reductions in their holdings of equities but many did not do so only to be hit later by the even more dramatic fall in the FTSE100 index of 40% from 2008-2009. Even when the shares began to recover somewhat the pension funds were hit yet again by the fall in the discount rate used to calculate the liabilities."

 

[Chippy_boy]

"

Taxation of Surpluses and Pension Holidays Back in 1988 Nigel Lawson decided to tax pension fund "surpluses" to prevent companies using the pension funds as a money box for tax avoidance purposes. This tax threat subsequently led companies to adopt a much tighter rein on the pension funds on the grounds that they had to "use it or lose it" to the Inland Revenue. However the IR valuation above which tax would be levied was made on a much more conservative basis than that used for the Minimum Funding Requirement valuation so there was really no justification to run the funding level right down to the MFR which many companies were doing. (In any case only about 30 pension funds out of the 100,000 schemes had ever been taxed under these rules.) During the early 90s companies were using these alleged surpluses for "industrial restructuring", i e offering very generous early retirement schemes to employees in their 50s for "downsizing" or so that they could be replaced by younger less expensive recruits. In the late 90s when the equity market was booming the companies also awarded themselves "contribution holidays" which in some cases were later extended to their employees as well. This meant that labour costs were held artificially low and those companies thereby gained a market advantage and greater profits which in turn boosted share prices. Not paying any contributions into the pension schemes soon became the norm, a habit it proved difficult to break. The right of companies to use their fund's "surpluses" in this way was challenged in the courts by pensioners but although they won in the High Court and the Court of Appeal this was eventually overtunred by the House of Lords decision in 2001. As far as the pension funds were concerned it would have been much wiser to allow the surpluses to build up in anticipation for the inevitable fall in the stock market. It is estimated that the long-term impact of the contribution holidays from 1987 onwards amounted to £18.5bn and has accounted for around 30 per cent of the current deficit in pension funding. In at least one instance a company in purchasing another one along with its pension scheme was able to siphon off more than it paid for the company in the first place and the pension scheme now has a deficit which exceeds that sum whereas if the holidays not been taken it would not be in deficit now.	The Causes of Closure​ Taxation of Surpluses and Pension Holidays "£5 billion Pound Raid" Minimum Funding Requirement Stock market crashes Accounting Standards Increased longevity Actuaries Increased management costs Restrictions on top hat pensions Pension Protection Fund It is estimated that the long-term impact of the contribution holidays from 1987 onwards amounted to £18.5bn and has accounted for around 30 per cent of the current deficit in pension funding. See also: ONS podcast on scheme membership (22 June '11) BBC MoneyBox "The Death of Final salary Schemes" (28 April '11) and Selected Statistics on Occupational Pension Schemes
"The £5 billion Pound Raid" In 1993 Norman Lamont reduced the value of tax credit on share dividend payments for pension schemes to 25% which later provided Gordon Brown with the idea of abolishing it altogether. This he did as soon as Labour came into office in 1997. The CBI welcomed the move though the consultants, Arthur Andersen, had spelt out the possible dangers for pension schemes to the Treasury. At the same time the new Chancellor reduced the Advanced Corporation Tax (ACT) paid by companies, perhaps believing that companies might pass some of this saving to the pension funds to compensate the latter for the loss of the tax credit income. That just didn't happen of course but in any event on average individual pension funds have suffered a loss of less than 0.5% a year which is insignificant when compared with the losses due to the over-exposure of most funds to falls in the value of equities. Furthermore as Paul Myners pointed out this is also roughly the amount of money wasted on transaction costs by pension funds. However the removal of ACT relief did turn out to be a death blow for many smaller pension schemes which were struggling in 2000 to 2003 and whose sponsoring employers could not benefit from the supposedly offsetting corporation tax cut as they were not making much if any profit.	Norman Lamont followed by Gordon Brown
The Minimum Funding Requirement The 1995 Pensions Act had introduced the "Minimum Funding Requirement" for occupational pension schemes as a result of the Robert Maxwell pension scandal. Its very name induced people to believe that henceforth their scheme assets were safe from predators like Maxwell if it was "fully funded" on the MFR. Although the Institute of Actuaries quietly pointed out that this was in actual fact far from being the case, by allowing "surpluses" to be defined in an over-optimistic way it encouraged the culture of extensive contribution holidays. This situation was then made worse by the present government, following pressure from the NAPF, by actually reducing the MFR level by up to 19% in 1998 and by a further 8% in March, 2002. This move was designed to ease some of the pain caused by the removal of the dividend tax credits in 1997. The MFR funding requirement typically then covered no more than about 50% of the guaranteed liabilities. Thus pension fund assets were reduced to levels which no longer matched the liabilities and when the stock market fell between 2000 and 2003 companies faced the prospect of having to pay huge sums to restore even this lowered MFR level. Belatedly in September 2005 the Pensions Act 2004 replaced the MFR by a "scheme specific funding requirement" to ensure that pension funds are maintained at a more realistic level in future.	Robert Maxwell​
Stock Market Crashes: 2000-2003 and 2008-2009 In 2000 the average pension fund had 60-70% of its assets invested in equities with some even investing up to 90%. This is on the grounds that in the long-term, they will generate higher growth than the alternatives such as corporate bonds and government gilts. The greater the investment returns the less the company then has to provide in contributions to the fund. However, the reason equities have higher returns than bonds is that they have higher risks. In 2001 the Boots pension fund moved all its assets into bonds to protect them from the coming fall in share values which many analysts predicted. In general though most fund trustees continued to follow their investment managers' advice to maintain high levels of equities, this type of investment being hugely profitable for them. At the peak the UK pension funds held a total of about £800 billion of assets of which about 70% was in equities and the total assets value dropped by about 30% to about £560 billion. Following the recovery in 2004-2007 some funds did make small reductions in their holdings of equities but many did not do so only to be hit later by the even more dramatic fall in the FTSE100 index of 40% from 2008-2009. Even when the shares began to recover somewhat the pension funds were hit yet again by the fall in the discount rate used to calculate the liabilities."

Interesting thanks. I did not realise Lamont started it reducing the divident credit rate. Utterly stupid move, whoever was responsible for it. Not only has it cost £250bn in lost pension fund growth, it means that our pension funds are now barely invested in UK blue chip stocks. Historically when e.g. BP made bumper profits it was great for pensioners whose pensions directly benefitted. Now overseas investors directly benefit.

 

[Chippy_boy]

The post you refer to is just a carbon copy of the shite you’ve been passing off for the last 3 months.
Predictable and sad, yet you have the fucking audacity to claim others are crackers.

There's nowt audacious about being right, mate.

 

[BridgyDids]

No, genuinely I would not. In all seriousness, I cannot think of a single positive thing that they have done since taking power. Not one single positive thing. Nothing.

From agreeing to pay rises with nothing in return, to taking away the WFA to calling anyone who's concerned about mass migration and right wing thug, to presiding over people being jailed for tweets, to handing out favours to cronies, accepting bribes for him and his mrs, lying - overt lying - about a black hole (a) of their own making and (b) that they knew about all along. Thousands more arriving on boats whilst doing nothing to even remotely deter it. Billions committed to foreign green projects. Bunging £500m at Tata to put people out of work. It's ALL horseshit. All of it. There isn't one solitary decent thing they have done.

If they do something "good" I wiil applaud it. I am all ears.

I struggle to believe this…

You’d only applaud it, if GB News/Telegraph etc told you it was ok to.

Did you applaud Tony Blair/Gordon Brown for anything they did “good”? Any examples? I’m guessing the answer will be “what’s that got to do with anything”or similar.

And I voted Tory 14 years ago, as I felt austerity was the way forward. I was wrong with hindsight. They helped with first time buyers in that term too, so my parameters where something good for me personally and something I thought was good for society. They lost me during the Johnson era, as it was corrupt and a shit show.

I voted for Starmer, believe he is doing a good job with the hand he’s been given, but really feel let down with the clothing debacle.