Pensions and independence

[SandyCromarty]

4 minutes ago, DMCs said:

Completely incorrect.

Explain.

[Dawson Park Boy]

6 minutes ago, DMCs said:

In that situation it's a bit vaguer and would depend on a couple of factors in the post-independence negotiations relating to whether British citizenship is still held by Scots in an indy Scotland and whether they come to an agreement on pensions. 

There are either two scenarios:

1 - Current pensioners keep getting their pension as promised but the Scottish government takes up the liability instead of the British government. Future state pensions of any kind are paid by Scottish government.

2 - Current pensioners get their pension as promised from UK government (similar to how UK gov pays pensions of those retired in Spain) but all future state pensions of any kind are paid by Scottish government.

So in scenario 1 if the post-indy Scottish government cut the state pension then I'd imagine there would not be cuts to current pensions only future pensions so the Scottish government would take the full liability.

Scenario 1 is probably more likely but the issue is that we don't really have a relevant historial example to draw on. Post indepdence movements in Europe were either too long ago or in the Eastern bloc.

Thanks.

That makes sense.

[DMCs]

Just now, SandyCromarty said:

Explain.

I have in my earlier reply to you. Pensions are paid from current government revenue.

[SandyCromarty]

56 minutes ago, DMCs said:

I don't think you understand how pensions are paid. There isn't a pension pot because there never was one. The state pension has always been paid by current taxation and the figure received is only very indirectly related to actual NI contributions. Someone who earns £118 a week for a year and someone who earns £25,000 per week for a year gets exactly the same state pension figure for that year despite the first person paying £0 in NI contributions per annum and the second person paying nearly £30k in NI alone.  There isn't a pot of your pension contributions in a vault somewhere. This is how state pension payments work in developed economies.

"you will start paying into a Scottish Pension Scheme and still be entitled to a uk pension if you paid into it." This isn't true. You will only be entitled to a UK pension if living in an indy Scotland IF you were already getting and drawing down that pension when independence happens. If independence happens then the Scottish government is responsible for pension payments

I don't know where you're coming from by explaining various National Insurance contributions to me, it bears no relevance to the discussion on pensions paid after Independence.

You failed to mention what I highlighted with the Polish worker paying into a uk pension scheme and then retires back to Poland, here's the government guidance and the same would apply to Scots living in an Independent Scotland;

Do you honestly think that a Scot of say 50 years of age who has paid his money into a uk pension scheme for 30 years is not entitled to that pension, denying that would be illegal,

If a Pole is entitled as below why can't a Scot as a non uk citizen be paid back his contributions.

Do non UK citizens get state pension?

Yes – if you are eligible for the UK state pension, then it can be paid to you in a country outside the UK. You can find out more information in our question below How do I claim a UK state pension?

 

 

 

[SandyCromarty]

14 minutes ago, DMCs said:

I have in my earlier reply to you. Pensions are paid from current government revenue.

I don't give a shit how it's paid as the discussion is primarily on Scots entitlement to a uk pension when resident in an Independent Scotland.

[DMCs]

2 minutes ago, SandyCromarty said:

I don't know where you're coming from by explaining various National Insurance contributions to me, it bears no relevance to the discussion on pensions paid after Independence.

It does because you were saying that the state pension is based on your contributions when it really is only very indirectly. It's not like a private or employer pension where a pot is invested in periodically and could grow if certain stock prices increase over time. It's a benefit like JSA.

 

 

[Dawson Park Boy]

5 minutes ago, SandyCromarty said:

I don't know where you're coming from by explaining various National Insurance contributions to me, it bears no relevance to the discussion on pensions paid after Independence.

You failed to mention what I highlighted with the Polish worker paying into a uk pension scheme and then retires back to Poland, here's the government guidance and the same would apply to Scots living in an Independent Scotland;

Do you honestly think that a Scot of say 50 years of age who has paid his money into a uk pension scheme for 30 years is not entitled to that pension, denying that would be illegal,

If a Pole is entitled as below why can't a Scot as a non uk citizen be paid back his contributions.

Do non UK citizens get state pension?

Yes – if you are eligible for the UK state pension, then it can be paid to you in a country outside the UK. You can find out more information in our question below How do I claim a UK state pension?

 

 

 

Sandy - what I think you’re missing is that prior to retirement, Scottish citizens within the UK benefitted from the taxation collected but NOT put into a hypothecated fund as well as English citizens. 

[Loki]

6 minutes ago, DMCs said:

It does because you were saying that the state pension is based on your contributions when it really is only very indirectly. It's not like a private or employer pension where a pot is invested in periodically and could grow if certain stock prices increase over time. It's a benefit like JSA.

 

 

It is a benefit like JSA.  JSA is only awarded based on your NINO contributions over the last two tax years.  No active contributions no benefit.  Income based JSA does not exist anymore apart from old claims pre dating UC.  The amount of State Pension you could get is based in your NINO contributions over 35 working years (some older claims will be 30 years).  To get a full state pension you need to qualify for all 35 years.  If you do not qualify for 35 years you do not get the full amount and this is then decided on a pro rata basis.

I think Sandy is referring to that, but I agree with you otherwise that there is no pension pot to speak off.  I would imagine that this would be negotiated in any separation agreement.

[DMCs]

Just now, Loki said:

It is a benefit like JSA.  JSA is only awarded based on your NINO contributions over the last two tax years.  No active contributions no benefit.  Income based JSA does not exist anymore apart from old claims pre dating UC.  The amount of State Pension you could get is based in your NINO contributions over 35 working years (some older claims will be 30 years).  To get a full state pension you need to qualify for all 35 years.  If you do not qualify for 35 years you do not get the full amount and this is then decided on a pro rata basis.

Yes, correct. However the figure to qualify for a year is very minimal nowadays (only just over £6k p/a in income) and once a year counts as having been qualified it's the same whether you earn £10k p/a or £10m p/a. Which is why it's only very indirectly based on your contributions. 

[Loki]

4 minutes ago, DMCs said:

Yes, correct. However the figure to qualify for a year is very minimal nowadays (only just over £6k p/a in income) and once a year counts as having been qualified it's the same whether you earn £10k p/a or £10m p/a. Which is why it's only very indirectly based on your contributions. 

I would say if you changed that to "very indirectly based on the level of your contributions" we would be in agreement.  But following on from that If I have qualified for 20 years already why would I not get paid when other nationals get paid the benefit as they have qualified for it?  So I can see Sandy's point of view as well.  Personally I don't think they will ever be an answer to that until separation occurs.

[Miguel Sanchez]

If you're under 30 there's not going to be a state pension by the time you're old enough to claim it, just give the old people whatever they want for independence to happen and get on with it.

[yoda]

4 hours ago, SandyCromarty said:

If the Government fails as the German economy did in the early 1920's then we have a serious problem, presently there is concern over uk government borrowing but it is predicted that the economy will cope.

Using Weimar Germany as an example

 

[101]

47 minutes ago, Miguel Sanchez said:

If you're under 30 there's not going to be a state pension by the time you're old enough to claim it, just give the old people whatever they want for independence to happen and get on with it.

How could the scrap it when you have paid in already? I get they could give you back what you paid but surely that would be expensive to calculate.

[Hammyton]

The concept that a government cannot afford pensions going forward is false.

UK prints its own money, borrows from itself.  Effectively for governments money has little meaning. 2 Trillion in debt, 3 trillion.....it all makes little difference.   They will never pay it back.  Yes they will pretend they are trying to, talk about austerity, but they will never clear it only borrow slightly less.   Its all used to control the masses. How much has Covid cost, would it be better borrowing that amount to build a just society and invest in infrastructure. 

Money is a controlling device, allows governments to divide and control the masses.   Sets third world against G7, against G20.  Controls the world order and keeps you all under control. Do Insert other media not accept their tales of woe - money is only  controlling device.

 

 

[lichtgilphead]

1 hour ago, Loki said:

I would say if you changed that to "very indirectly based on the level of your contributions" we would be in agreement.  But following on from that If I have qualified for 20 years already why would I not get paid when other nationals get paid the benefit as they have qualified for it?  So I can see Sandy's point of view as well.  Personally I don't think they will ever be an answer to that until separation occurs.

I would agree with this. 

Obviously, it is possible to receive pensions from more than one source. My main pension will be paid from the contributions I have made into my pension fund over the years - that won't change. However, I will also be entitled to my state pension from each & every state that I have worked in during my working life.

In personal terms, I would expect my UK state pension to be calculated by reference to the number of years that I made sufficient NI contributions to the UK exchequer and my Scottish state pension to be  calculated by reference to the number of years that I contributed to the Scottish exchequer after independence.

The SG will pay my Scottish state pension, but responsibility for my UK payments will be part of the Indy negotiations. Either the rUK government will pay for their own liablities to me as they fall due after I retire, or they may choose to pay the Scottish Government a lump sum to pay for all their future liabilities. Whatever happens, I should receive the same amount of return on my contributions during the years I worked in the UK.

Obviously, after Scotland has been independent for around 50 years, there will be a minimal number of people left that ever paid NI to the UK Government, so the perceived "problem" will eventually resolve itself.

But hey, scaremongering is one of the few cards that the Yoons have left. Be very very afraid!

[Dawson Park Boy]

I think that Scenario 1 as per DMC’s post is the likely way forward. For existing pensioners, as Scotland was part of the UK and benefitted by NOT having to provide a pension fund, then it is reasonable that the SG should pay these out of the current taxes it will receive from the Scottish workforce.

Obviously, a complex issue which will require a lot of detailed negotiation

[DeeTillEhDeh]

3 hours ago, DMCs said:

I have in my earlier reply to you. Pensions are paid from current government revenue.

State pensions only but not public sector pensions - whether they have sufficient funds to finance commitments is another matter.

[lichtgilphead]

14 minutes ago, Dawson Park Boy said:

I think that Scenario 1 as per DMC’s post is the likely way forward. For existing pensioners, as Scotland was part of the UK and benefitted by NOT having to provide a pension fund, then it is reasonable that the SG should pay these out of the current taxes it will receive from the Scottish workforce.

Obviously, a complex issue which will require a lot of detailed negotiation

Scottish NI contributions currently contribute to the total amount of NI raised by the UK. Accordingly, we DO contribute to the UK's nominal pension fund.

If we benefit from "free" non-contributory pensions (as you appear to believe), why is my employer taking more than £400 in NI from me every month?

[SandyCromarty]

3 hours ago, DMCs said:

It does because you were saying that the state pension is based on your contributions when it really is only very indirectly. It's not like a private or employer pension where a pot is invested in periodically and could grow if certain stock prices increase over time. It's a benefit like JSA.

 

 

I provided a solid uk government commitment  to pay pensions to non uk citizens of another country as long as they qualified, and that would obviously apply to Scots resident in an Independent Scotland.

In an earlier post you remarked that though Scots had paid into a uk pension they would not receive that pension once Scotland became Independent.

Can you provide any evidence at all where the uk government has stated that.

And please don't come back with a Gordon Brown 2014 Better together type lying shite.

Just let us all know where you based that statement on, or is it wishful thinking on your part?

Edited April 7, 2021 by SandyCromarty

[DMCs]

41 minutes ago, DeeTillEhDeh said:

State pensions only but not public sector pensions - whether they have sufficient funds to finance commitments is another matter.

Many public sector pensions too including NHS DB pensions.