Pressure: Readers say Prime Minister Rishi Sunak must protect pensions
Readers are adamant that the state’s triple-locked pension guarantee must be honored in the fall budget – despite the government’s poor fiscal health.
Last week we invited readers to suggest how Prime Minister Rishi Sunak and Chancellor of the Exchequer Jeremy Hunt could fill the massive £50billion black hole in the country’s finances. The government will unveil its plans on November 17. Many clever ideas have been put forward to reduce government spending. Most have called for a reduction in annual foreign aid, currently set at a figure equivalent to 0.5% of the country’s gross domestic product.
Some also believe it is time to do away with unfunded public sector pension schemes where taxpayers are often required to partially fund the pensions paid to retirees. These luxury defined-benefit pension plans are now rare in the private sector because they are very expensive for companies to maintain.
Yet when it comes to the triple-lock guarantee and the state pension, the view is almost universal: the government must stick to the guarantee and increase the state pension in April next year. by the higher of inflation, 2.5%, or income. . That would mean a 10.1 percent increase. The government has yet to confirm whether the increase will be introduced.
Pat McLaughlin, from Ringwood in Hampshire, says overseas aid should be suspended until the country is out of the financial quagmire it finds itself in. But the triple-locked state pension guarantee, he says, must be maintained, especially after it broke last year in light of the strong rebound in profits from furlough and lockdown.
Then-Chancellor Sunak said the 8% raise he should have given pensioners was unaffordable as the economy emerged from lockdown.
Pat, 71, who ran an exhibition and events company with his wife Judy, said ministers should stop seeing the state pension as ‘a benefit’. He adds: ‘The pension is a refund for years of hard work and diligently paying our national insurance contributions. It is outrageous that the government can tear up such an important guarantee at will. I accepted his decision to suspend the pension guarantee last year, but I will not do it if he does it again. I will never vote Conservative again and I’m sure I’m not the only gray voter when I say this.
He has already told his local Conservative MP, Sir Desmond Swayne, of his intention.
Clive Edgley, a 72-year-old former manager of a building materials company near Stockport, Greater Manchester, agrees. He says: “Rishi Sunak and Jeremy Hunt have an opportunity to restore credibility to the Conservative government for ordinary voters like me – a retiree of modest means, but with a traditional worldview based on integrity and honesty. This includes meeting the triple-locked pension guarantee.
Clive, who is married to Susan and has three children and seven grandchildren, admits he is better off than many retirees. He benefits from a “small” company pension to supplement his state pension. “There are a lot of pensioners who are worse off than me,” he says, “and who have no other source of income than their state pension. The government must support them by paying the increase in the frame of the triple lock.
Clive also believes it is time to cut or suspend overseas aid, which currently stands at around £11billion a year.
Janet Stevens, from near Heathrow in Middlesex, worked in marketing for 40 years. She believes the Tories will lose the vote of pensioners if they fail to stick to the triple lockdown.
Janet, 73, keeps herself fit and busy by doing a lot of volunteer work. “I’m lucky,” she said. “I have two small pensions and no mortgage to pay. But many people depend on state pensions to keep their household finances running. A promise is a promise and the government must honor it.
Gary Williams, a 63-year-old retired chartered accountant from near Sherborne in Somerset, believes the government would be justified in cutting the inflation-linked increase in the state pension to account for payments that he paid to retirees at his own expense. life support scheme. All retirees, he says, received help with their energy bills (as did all households) while eight million received additional pension-specific cost-of-living payments.
Gary says: “These payments will reduce the impact of inflation on the household budget of many pensioners, so they should be taken into account when the government designs the state pension increase from next April. “
When it comes to government revenue collection, retired management consultant Richard Lumb says windfall taxes on oil and gas companies and banks are in order. Sunak and Hunt predict a large tax bite on energy companies as their profits rise. Over the past few days, BP said it made a profit of $8.2bn (£7.1bn) between July and September, more than double the same period last year.
On oil and gas companies, Richard, 67, from Keyworth in Nottinghamshire, says a ‘huge windfall tax is appropriate’.
As for the banks, he says: “They have behaved appallingly over the past few years, paying savers next to nothing and making tens of billions of pounds in profit in the process.”
He adds: “Whenever the banks’ base rate increases, as it did on Thursday by 0.75 percentage points, they do little for savers. It’s insulting. Banks should also be punished for closing the last branches in communities like my big village.
Gold-plated public sector pension schemes should be phased out according to Robin Ede, from near Bournemouth. The 79-year-old retired financial adviser says it’s crazy that taxpayers often have to support payments made to retirees from these schemes if there’s a shortfall between employee pension contributions and payments to retirees.
He asks, “Isn’t it time these systems were shut down?” Then all of us, whether we work in the public or private sector, would see our future pensions determined by the amount of our contributions and the performance of stock markets. This would create a sense of unity, rather than the prevailing ‘them and us’ view of pensions.
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