For those outside the world of pensions, triple lock is perhaps a term from the sedate world of canal cruising holidays. However for pensioners of the future it is a term they should acquaint themselves with and the impact it has on their future prosperity.
This fairly new chestnut of the pension triple lock raised its head recently. Baroness Altmann, former Pensions Minister in the Cameron Government, has voiced the opinion that the triple lock would not be affordable after 2020. Baroness Altmann has been vocal on pension policy in the past few weeks, (well since she left Government), with her earlier comments on Tata Steel and pension provision. Yet what does the pension triple lock mean and why should our future pensioners care so much? Read more »
In 1977, Monty Python’s Life of Brian asked ‘What have the Romans ever done for us?’ to which it appeared, well, quite a lot actually. However, with the imminent changes within the pensions industry, the question you may have to consider is rather ‘What has the Government ever done for us?’
For starters, there is the introduction of the new basic State Pension which from 6th April 2016 will deliver a clearer State Pension for future pensioners. The current basic State Pension and State second pension (S2P) will be abolished and replaced by a single-tier, flat-rate State Pension of £155- a-week paid to everyone who has paid 35 years of National Insurance contributions (NICs).
A change of this magnitude will be rightly debated and queried, and as administrators there are questions that we can expect to be asked, namely why the government has introduced such a significant change. In turn, we can also expect many pensioners to now have a greater focus on their personal pension benefits as members look to clarify how the changes may affect their total monthly income. Read more »
“The acceleration of changes to the State Pension is not a surprise, as life expectancies continue to increase. Within retirement, life expectancy has almost doubled over the last century. While it may not be a particularly cheery message for the festive season, there is unfortunately no magic wand that can be waived when it comes to pensions. Simply put, the only way to avoid having to work longer to fund your retirement is to save more and save earlier.”
“It is likely these changes will increase the blurring of the lines between working and retirement with more and more people continuing to work even when they are receiving pension income.”
Now that some of the dust has settled from the Government’s long-anticipated launch of their white paper on state pension reform, the implications for employers may be far reaching and may act as a catalyst for further changes in employees’ benefit packages. So, what will this change mean for employers? Read more »
The value of the state second pension (S2P) is to be reduced from April 2010. Individuals earning more than £31,800 per annum will see a reduction of around 5% in the benefit built up despite continuing to pay the same national insurance contributions as prior to the change. The Government have claimed that the move will be offset by their proposed re-introduction of the earnings link to state pensions.
In a separate move widows will only be able to claim half of their husbands S2P rather than the full amount, a move which will undoubtedly impact those spouses who have stayed out of the workforce to raise a family.
All looks like an effort to control the costs associated with the re-introduction of the earnings link to the basic state pensions as life expectancy continues to improve.
I’ve been doing some catching up on “pensions news”.
The latest annual report from the Office for National Statistics (ONS) suggests an increasing number of people contributing to work placed pension schemes. Interesting, I’d like to see how the 2009 figures look but encouraging nonetheless. Read more »
Some of you may be familiar with Schrodinger’s Cat . In feline terms it’s probably not as famous as McCavity, or even Mrs Slocombe’s pussy, but a couple of recent pension articles put me in mind of it.
I can’t pretend to understand the philosophical basis behind Schrodinger’s thought experiment – Descartes lost me at “I think therefore I am”, but a tabloid summary would be as follows:-
Page 3 lovely, Angie, 19, from Ilfracombe, says “A cat, along with a flask containing a poison, is placed in a sealed box shielded against environmentally induced quantum decoherence. If an internal Geiger counter detects radiation, the flask is shattered, releasing the poison that kills the cat. The Copenhagen interpretation of quantum mechanics implies that after a while, the cat is simultaneously dead and alive. Yet, when we look in the box, we see the cat either alive or dead, not a mixture of alive and dead. Poor little kitty.”
I don’t know what you make of that, but what it says to me is that Read more »