The Labour Government

[hampshireblue]

Think the problem is its an unrealised gain until you sell the shares/bonds and take it out of your pension. In which case you might as well just have a higher tax rate for pension drawdowns over a certain amount. If the pension grows and it isn't taken its clawed back by IHT anyway.

Now if we are looking at unrealised capital gain then there is a much larger prize which affects the seriously wealthy. That being art, cars, wine, whiskey, watches, Class A shares etc which are all bought as investments, held and untaxed, or in some cases (Class A shares) used as leverage to borrow money against at preferential rates using securities based lines of credit or similar lending tools for the wealthy.

You're right. But your unrealised gain is actual gain as the holder of the portfolio, could if they wished realise their gains by drawing that gain out immediately, but it either way it may persuade some, as it recently has my friend whose portfolio has done quite well, to drawdown a bit more than they otherwise would have done and spend it in the economy rather than it being saved in the pension which is effectively "dead" money as far as the economy is concerned.

 

[Kirkstall Blue]

Mass mobilisation is impossible in this country we are too divided and therefore can't even agree what we would be mobilising against.
My only hope and its a long shot is that enough supporters and politicians from the libs greens and the Labour back benches can come together to fight off this current cabinet and reform.
It can only start with Labour back benchers and members fucking off Starmer and his ilk.
I have a feeling though that come the next election we will have parties coming out with all sorts of fantasy crap to scrape a win or enough support to form a coalition.

I think we are creatures of habit once Covid and the parties in Downing Street have been forgotten then the voters will vote Conservatives or Lib Dem’s. If Starmer is replaced then Labour voters will stick with Labour or the Lib Dem’s

 

[WRicko]

Mass mobilisation is impossible in this country we are too divided and therefore can't even agree what we would be mobilising against.
My only hope and its a long shot is that enough supporters and politicians from the libs greens and the Labour back benches can come together to fight off this current cabinet and reform.
It can only start with Labour back benchers and members fucking off Starmer and his ilk.
I have a feeling though that come the next election we will have parties coming out with all sorts of fantasy crap to scrape a win or enough support to form a coalition.

What should Starmer be doing. It’s not like he isn’t spending on public services or taxing companies or the rich etc

 

[WRicko]

I fear in the wider scheme of things the budget will be irrelevant. Starmer and Reeves have always sought to position themselves as pragmatic grown ups, almost technocratic in their approach. Whether you think they are doing a decent job of that or are completely incompetent is imo totally irrelevant because to position our current issues as fixable through technical or economic policy means I think is to misunderstand where we are at this point in history.

The root of our problems are not mismanagement of the economy by an individual Chancellor be that a red one or a blue for that matter. Our problem is that from the perspective of ordinary people our system is completely and utterly fucked and the world is sliding into a variety of different flavours of authoritarianism. This is not an issue fixable by trying to wrangle economic policy within an economic system that in itself has increasingly become a fundamental part of the problem. Though you can't fully decouple them, the capture of the nation state is a political not an economic problem. The current labour government doesn't at this time have anywhere near the political juice to address this, if anything their refusal to do anything other than tactical politics has surrendered the narrative to a party who only want power so they can finish the job and impoverish virtually everyone. I'd like to think someone could mobilise a mass movement before the only option for change becomes something more chaotic as and when the next stage of the latest industrial revolution bites. But who?

What should he be doing he is spending on public services he is taxing the rich and business etc

 

[hilts]

What should Starmer be doing. It’s not like he isn’t spending on public services or taxing companies or the rich etc

He's not taxing companies or the very rich enough, he needs to be braver on inequality of wealth, he's not leading he's gets sucked into media negatives and is shit scared of Reform, his welfare reform attempts have been embarrasing.
Arresting protesters on masse and it sounds like he's about to scrap some jury's sitting. Its a bit too authoritarian.
Frankly he sold himself to the members as a socialist, he ain't. He's a charlatan who only cares about his legacy of becoming PM. You could quite easily slap a blue rosette on him. He's about as radical as one of his beige suits.
Anyhow let's see what tomorrow looks like. Let's see how much he throws to those struggling and how much he's prepared to take off the very wealthy. The people who are no doubt in his 'circle'

 

[threespires]

What should he be doing he is spending on public services he is taxing the rich and business etc

I don't think he can do or is wired to do anything else, that was really my point. To make a difference he'd need to be making wholesale change to the tax system, trying to build or join a coalition to put some guide rails around big tech and a raft of other things he just doesn't have the political capital, allies or will to do. The things he can do and will try to do won't deliver enough to buy him the capital he needs to do the things that might start to make a difference.

All that said right now if he could fix the shitshow of the Blue Car Park I'd vote for him. I might even be inclined to let him pick the f***king team.

 

[meltonblue]

He's not taxing companies or the very rich enough, he needs to be braver on inequality of wealth, he's not leading he's gets sucked into media negatives and is shit scared of Reform, his welfare reform attempts have been embarrasing.
Arresting protesters on masse and it sounds like he's about to scrap some jury's sitting. Its a bit too authoritarian.
Frankly he sold himself to the members as a socialist, he ain't. He's a charlatan who only cares about his legacy of becoming PM. You could quite easily slap a blue rosette on him. He's about as radical as one of his beige suits.
Anyhow let's see what tomorrow looks like. Let's see how much he throws to those struggling and how much he's prepared to take off the very wealthy. The people who are no doubt in his 'circle'

Think people are really underestimating the difference between those they percieve as rich vs those that are really rich, and that’s a gap that is growing every day.

The latter aren’t going to feel much impact at all from tomorrow, the former will probably get the biggest hit. The cycle continues as we all go after the next wrong bogeymen again…

 

[Kompany Car]

You're right. But your unrealised gain is actual gain as the holder of the portfolio, could if they wished realise their gains by drawing that gain out immediately, but it either way it may persuade some, as it recently has my friend whose portfolio has done quite well, to drawdown a bit more than they otherwise would have done and spend it in the economy rather than it being saved in the pension which is effectively "dead" money as far as the economy is concerned.

All investments are in essence dead money apart from for the recipient of it at a later date. The British ISA was actually a decent idea if you want to put money into UK businesses, but not at the detriment of other ISA products.

Getting money into the economy from savings is as much about giving people confidence to do it and not being worried about future shocks like energy prices, sudden changes in taxation and job security. I know people who are reasonably well off holding a lot of cash at the moment as they are really worried about job security. Most are well remunerated in PAYE roles. Yes people can say, that must be nice to earn enough to build a decent cash buffer, but they are only doing it as they can see how bad the jobs market is even for highly skilled people in the private sector.

For older people as they age they generally become much more risk averse and thats partly due to physical changes in the brain, but also not being able to work or gain employment due to ageism.

I've said it before, but the death of the final salary pension in the private sector was one of the worst things to happen and unfortunately it was Gordon Brown who put the final nail in the coffin back in 97. Its not only made everyone have to suddenly become financially astute investors, with no training, but also removed the security in old age. Annuities fail to offer decent income levels for a joint life policy under the conditions which the government is striving for, i.e. lower gilt yields and low inflation. Yes they have been good whilst interest rates were high but that is not great for the UK as a whole. This results in people not spending down their pension pots for fear of running out.

If we want people to get money into the economy, its much better to incentivise the desired behaviour in the first instance. Forcing people to do something almost always results in people trying to circumvent the system and secondary effects such as people being worried about future tax creep and hence stopping using pensions.

For the record I appreciate you are only trying to think of some potential solutions to a very difficult to solve problem.

 

[meltonblue]

All investments are in essence dead money apart from for the recipient of it at a later date. The British ISA was actually a decent idea if you want to put money into UK businesses, but not at the detriment of other ISA products.

Getting money into the economy from savings is as much about giving people confidence to do it and not being worried about future shocks like energy prices, sudden changes in taxation and job security. I know people who are reasonably well off holding a lot of cash at the moment as they are really worried about job security. Most are well remunerated in PAYE roles. Yes people can say, that must be nice to earn enough to build a decent cash buffer, but they are only doing it as they can see how bad the jobs market is even for highly skilled people in the private sector.

For older people as they age they generally become much more risk averse and thats partly due to physical changes in the brain, but also not being able to work or gain employment due to ageism.

I've said it before, but the death of the final salary pension in the private sector was one of the worst things to happen and unfortunately it was Gordon Brown who put the final nail in the coffin back in 97. Its not only made everyone have to suddenly become financially astute investors, with no training, but also removed the security in old age. Annuities fail to offer decent income levels for a joint life policy under the conditions which the government is striving for, i.e. lower gilt yields and low inflation. Yes they have been good whilst interest rates were high but that is not great for the UK as a whole. This results in people not spending down their pension pots for fear of running out.

If we want people to get money into the economy, its much better to incentivise the desired behaviour in the first instance. Forcing people to do something almost always results in people trying to circumvent the system and secondary effects such as people being worried about future tax creep and hence stopping using pensions.

For the record I appreciate you are only trying to think of some potential solutions to a very difficult to solve problem.

Completely agree with all of that, particularly on final salary pensions.

 

[Kush45]

Wouldn't trust Labour with the kids piggy banks.
Couldn't organise a piss up in a brewery.

 

[NPBlue]

You sound like they aren't taxed at all. The top 1% pay 29% of all our taxes already. People need to stop being so bitter and needy and blaming anyone but themselves. The welfare state should be there to support those genuinely in need not those for whom it's a lifestyle choice. I cannot fucking bare this "I want more money spent on x, y or z, and I want someone other than me to pay for it". Drives me nuts. What happened to personal responsibility? I wish we had 50 Elon Musks in this country. It would be a massively better place if we had. We have none, and the richest one we did have - Mittal - has now fucked off because of what Labour has done and is doing. Fucking disaster.

I can see are never going to agree on this but that's my perspective. End of.

OK.

Enjoy your life, vote for what you want, and when, not if, the avericiousness of the wealthy rears up and bites you, remember it's your personal responsibility that enabled it.

When it happens, get a better job, don't have kids you can't afford, cancel your Netflix subscription, and move to a cheaper area.

Over and out.

 

[Gorbachev]

Just seen that apparently the last time the basic rate of income tax got raised was back in the 70s, and along with other tax hikes caused the UK to go to the IMF for a bailout.

Am I wrong in thinking or presuming this is by design for this government?

An IMF bailout will almost certainly force the country to rejoin the EU I would have thought.

I do wonder if Labour are willing to sacrifice themselves for this end game.

 

[metalblue]

There are too many students and too many foreigners.
We need to train up our own not let them get into unrepayable debt. Learn a trade and get a well paying good job.
Gets an Apprenticeship.
Labour announces 50p increase in minimum wage for Apprentices in England
Noooooo - this is socialism business can't afford it
Back to the top to repeat incoherent doom loop from people who want others to work on low wages

I’m all for people learning a trade, they should start teaching it as an option at high school. Your math and English lessons focusing on practical skills like how to measure up and quote for a job, deal with customers that sort of thing. I’d wager a bunch fewer kids will fuck around in class as it’ll actually interest them resulting in better outcomes all round.

Then, when they enter the workplace, they’re not green and can earn for their new company thus allowing them to be paid even more than some nominal wage set by the state.

The current policy (and this isn’t this governments fault) is that we know as a nation we need trades we just outsource the problem to business and demand they pay for the privilege of fixing it. Only ones I see who suffer are those folk who want to become a trade as businesses need to weigh up the benefit in the cost involved in training versus employing someone who can already do the job at a higher wage.

 

[metalblue]

No. Let's take my mate. His pension is worth £2m( lucky git). If it rises to £2.2m he would pay, say, 1% on a proportion of that. Let's say anything over £2m, so in this case 1% of £200k = 2k. If he does very well then say, 1% of £500k = £5k. If his pension drops below £2m on the date it is assessed he pays nothing extra. The point is, he has done nothing in the first 2 examples to improve his wealth by £200-£500k and pays nothing extra tax wise.

You can substitute figures as you wish, but someone in the top 1% with a very large pension pot would be paying, literally, a bit more and probably less than such a fund may lose in a single day due to market variations.

That sort of feels very similar to a management fee and what if he had £1m in pension and £1m in his own share portfolio? Will you force him to sell 1% of his shares annually? Given he will pay tax on his pot as he drawers it down that seems a draconian approach and probably not as beneficial for the economy / the treasury.

If they have to get money now and fuck a future government revenue by messing with pensions I’d much prefer they make changes to the tax you save on pension contributions as it can be pitched as being fairer and will likely appeal to the left (if it is or isn’t, is a point of discussion) rather than start inventing ever new ways of taxing people who will soon find loopholes.

 

[metalblue]

Your passion for the barm is impressive and I will join your barm revolution comrade.

Finally something we can all agree on in the politics forum!!!

 

[hampshireblue]

That sort of feels very similar to a management fee and what if he had £1m in pension and £1m in his own share portfolio? Will you force him to sell 1% of his shares annually? Given he will pay tax on his pot as he drawers it down that seems a draconian approach and probably not as beneficial for the economy / the treasury.

If they have to get money now and fuck a future government revenue by messing with pensions I’d much prefer they make changes to the tax you save on pension contributions as it can be pitched as being fairer and will likely appeal to the left (if it is or isn’t, is a point of discussion) rather than start inventing ever new ways of taxing people who will soon find loopholes.

I agree with your last paragraph and levelling up the tax relief would be a good idea to say, 25-30%. That helps the lower paid without being a major disincentive to save into a pension.

My main point is that wherever you put the starting point and whatever rate you choose for taxing a large pot, the fact remains that the very/reasonably wealthy (if you consider someone with say £4m in their pension wealthy) accrue additional wealth and potentially that remains completely outside the tax regime until it is drawn down which could be decades.

 

[incred]

I hope Rachel's driver pulls up outside the correct house this time on Downing Street. The poor woman had to carry her briefcase at least 50 yards to her car at the last budget. Must have been awful for her with all the photographers taking pictures.

 

[The Future’s Blue!]

The Big Day.

 

[mancityvstoke]

I’m all for people learning a trade, they should start teaching it as an option at high school. Your math and English lessons focusing on practical skills like how to measure up and quote for a job, deal with customers that sort of thing. I’d wager a bunch fewer kids will fuck around in class as it’ll actually interest them resulting in better outcomes all round.

Then, when they enter the workplace, they’re not green and can earn for their new company thus allowing them to be paid even more than some nominal wage set by the state.

The current policy (and this isn’t this governments fault) is that we know as a nation we need trades we just outsource the problem to business and demand they pay for the privilege of fixing it. Only ones I see who suffer are those folk who want to become a trade as businesses need to weigh up the benefit in the cost involved in training versus employing someone who can already do the job at a higher wage.

Maths

 

[mancityvstoke]

Finally something we can all agree on in the politics forum!!!

fuck that