Showing posts with label Savings and pensions. Show all posts
Showing posts with label Savings and pensions. Show all posts

04 June 2015

State pension: too little, and getting less

In 2011, I commented on the fact that the basic state pension is acknowledged to be well below the level of income needed to reach a minimum living standard.

According to the Joseph Rowntree Foundation’s most recent report* on this, the annual cost of the ‘minimum basket of goods and services needed for an acceptable living standard’ for a single adult is now £10,155. The current full basic state pension, on the other hand, is £6,029 per annum – 40% below this minimum level.

The typical annual council tax alone takes up a sizeable proportion of the current state pension. A single pensioner living in even a modest home can easily spend over £1000 per annum on council tax, nearly 20% of his income, if forced to rely on the state pension.

Incidentally, the Rowntree Foundation report notes that the cost of the minimum basket has risen ‘by between a quarter and a third’ since 2008. If we assume that 33% is the more realistic figure, then the government’s CPI figure, which is one of the factors used to determine increases in the state pension, but which has risen only 19% over the same period, has severely understated the inflation faced by low-income pensioners, with the result that the annual pension has actually fallen in real terms since 2008.

I appeal for financial and moral support in improving my position.
I need people to provide moral support both for fund-raising, and as temporary or possibly long-term workers. Those interested should read my post on interns.


* Joseph Rowntree Foundation, ‘A Minimum Income Standard for the UK in 2014’

05 May 2015

The continuation of the pensions swindle

Nicola Sturgeon
Ahead of the General Election, which is said to be more focused than ever on the votes of pensioners, I am again re-posting my comments from 2010 on The Great Pensions Swindle.

I note that at least one political leader has now explicitly recognised that there is something unprincipled about deferring the age of entitlement to the state pension. Nicola Sturgeon, Scotland’s First Minister and Leader of the Scottish National Party, has argued that ‘it would be completely unacceptable for people in Scotland who have paid in to a state pension all of their lives to lose out’. Admittedly she is linking this to the egalitarian argument that Scottish people have a lower average life expectancy, and hence will lose out more – an argument that has been ridiculed by some commentators – but at least she appears to realise there is something wrong with a system into which people have paid on the basis of government promises, which are then abandoned retrospectively.

The unjust deferrals of the state pension age that have
already happened should be reversed.

I have a book entitled The Great Pensions Swindle* which, 40 years ago, made some useful points about the likely unreliability of state pensions. The following, however, is unrealistic:
The breaking point is not postponable indefinitely. The resistance to periodic increases in ‘social insurance’ contributions will begin all the sooner when the ‘contributors’ realise they are paying not insurance contributions but an income tax. (p.128)
In fact, no significant realisation arose that ‘National Insurance’ contributions were just a form of income tax, which increased the Government’s current spending money. Otherwise the book anticipates very much what has happened. What happens when a future generation decides it prefers to spend its money on what is fashionable at the time (overseas ‘aid’, social workers, ‘universities’, etc.) rather than providing a former generation with the pension it thought it was paying for? The pensions are ‘too expensive’; they are suddenly means-tested, and paid at ever later ages.
Not least, let it be clearly understood that ‘right’ (to the pension) and ‘contract’ are two more good words that have been made misnomers. A ‘right’ to a pension that a man acquires by saving for it is unambiguous. The ‘right’ a man has to an income when he can no longer work is of a different kind. The word has been re-defined to mean a moral right or claim on society. But transfers of income from one age-group, or class, or generation, to another represent decisions by one group, or class, or generation, to help another in time of need. No group, or class, or generation has a ‘right’ in any absolute sense. (p.129)
Retrospective legislation has become increasingly frequent, and by now no one seems to remember that there was ever anything against it. It used to be said that the individual had a right to know what was legally open to him (in taxation, etc.) so that he could plan his affairs to secure the best outcome in view of his own interests and priorities, as he conceived them to be.

The recent changes in the ages at which state pensions become payable is really an egregious example of retrospective legislation, and directly affects people in as bad a position as we are. If a company which offered pension schemes were suddenly to announce that all its pensions were to be paid two years later, those who had been paying into the schemes might well wish to sue it for breach of contract. When the government does the same thing, no legal redress is available. This has happened recently and seems likely to happen more, so that my junior colleagues’ pensions recede as one approaches them. The age at which one of them will start receiving her pension was first shifted from 60 to 62, then to 64, and then to 65. Another’s pension was shifted from 65 to 67, and seems likely to be further delayed to the age of 68.

Thus the state has already deprived us, who are trying to build up towards an adequate academic institutional environment, of seven years’ pension money, i.e. at least £42K at today’s pension rate.

There are several other examples of abandonment of principles, and I should be able to write about them at length because they are serious.
I appeal for financial and moral support in improving my position.
I need people to provide moral support both for fund-raising, and as temporary or possibly long-term workers. Those interested should read my post on interns.


* Arthur Seldon, The Great Pensions Swindle, Tom Stacey Books, London, 1970.

23 May 2014

Means-testing of pensions

I am reposting this piece from August 2010, in the light of the recent Daily Mail investigation by Tony Hazell that the government will not be paying the additional state pension to everyone, as claimed. The report also points out that an inflation increase, which certain former employees were guaranteed, will no longer be paid.
When Money Mail contacted the Department for Work and Pensions, it claimed it had never actually paid these inflation increases and the belief stems from ‘an over-simplification’. Yet we have obtained Government statements and leaflets published over many years which state time and time again that it does pay these inflation increases.
It looks as if the policy of cheating national insurance payers, where they think they can get away with it, is alive and well.

* * *

Of course the terrible financial crisis is taken as justification for yet more penalising of the more functional members of society in favour of the less functional (‘we must protect the poor’).

Both the means-testing of pensions, and the charging of those who have some capital assets for ‘care’ either in their homes or NHS prisons, are iniquitous. However the ‘care’ situation is complicated by treating as a ‘benefit’ (the same thing as a person might have paid for with his own money) what is really better described as an oppressive persecution. So I leave discussion of this complex question for the moment and confine myself to the rise of means-testing.

The state pension was initiated well before the rise of the Welfare State circa 1945, and for that reason was conceived as something which would be received as a right by those who had made the necessary number of qualifying payments - which were supposed, always fictitiously, to provide a fund which could be invested, and from the income of which the pensions would eventually be paid.

When I first went to the Society for Psychical Research after being thrown out of Oxford University in 1957, I thought that I must do everything possible to reduce the disadvantage at which I would be in comparison with, say, an Oxbridge professor of physics on reaching retirement age. At the time I did not find it credible that it would take me many years to get back into the right sort of academic position, but until I did, I would want the intervening years to drag down my pension income by as little as possible. Therefore I paid voluntary contributions for the unpaid student years, and went back to paying them each year as soon as I was no longer receiving a salary from the SPR.

As time passed, I became aware that the hostility to the idea of my working my way back into a suitable career was very great, and perhaps permanently insuperable. I continued every year, without fail, to pay voluntary pension contributions both for myself and for anyone who became associated with me and might be permanent. So I was paying four, and maybe five or six, contributions per annum out of what was usually a nugatory income. After forty years my own pension became payable, although I was still having to pay three voluntary contributions a year for other people. But the situation was turning around from being a drain on our pathetic resources to an annual income, although even when all the pensions became payable, the total income would still be very far short of what was needed to run the very smallest residential college cum research department.

Soon after my 40 years of efforts had been rewarded with the then basic state pension, I started to notice statements by officials to the effect that pensions would be allowed to ‘wither on the vine’, implying that no attempt would be made to keep them adjusted to inflation. After I had received my pension for some years the government decided that these pensions should be means-tested, so that help could be given to the ‘poorest’.

I felt (and always have done) pretty close to being the poorest of the poor myself, in being deprived of a salaried career, but I had built up capital over the years. This was because my only way of getting ahead in life had been to provide myself with capital, the gains on which could be used to finance my institutional environment, so that eventually I might be able to do something.

The means-testing was achieved surreptitiously. Annual increments became much smaller than they would previously have been, while an annual ‘Pension Credit’ (initially ‘Minimum Income Guarantee’) payable to those with very little in the way of savings began to increase.

Making the pensions means-tested was retrospective legislation, as everyone paying into them had been led to believe that they would not be means-tested.

Now I receive only the basic state pension, and not the supplement, which is paid to those who had made no attempt to increase their independence by saving money, such as the chronically unemployed who roam the streets of Oxford and draw disability allowances.

I believe it is the case that I would be receiving thirty-six percent more than I am receiving, if I were eligible for pension credit.

The question of ethics with regard to pension policy is one of the issues on which critical analyses could be being published by Oxford Forum if it were provided with adequate funding to do so. Meanwhile, the idea that it is ‘fair’ to penalise better-off pensioners is likely to receive further reinforcement from pseudo-research published by the universities.


06 January 2014

The retrospective pensions swindle

In view of the current debate about the possible cutting of benefits to pensioners, I thought it worthwhile re-posting this piece from 2010.

I have a book entitled The Great Pensions ‘Swindle’* which, 40 years ago, made some useful points about the likely unreliability of state pensions. The following, however, is unrealistic:

The breaking point is not postponable indefinitely. The resistance to periodic increases in ‘social insurance’ contributions will begin all the sooner when the ‘contributors’ realise they are paying not insurance contributions but an income tax. (p.128)

In fact, no significant realisation arose that ‘National Insurance’ contributions were just a form of income tax, which increased the Government’s current spending money. Otherwise the book anticipates very much what has happened. What happens when a future generation decides it prefers to spend its money on what is fashionable at the time (overseas ‘aid’, social workers, ‘universities’, etc.) rather than providing a former generation with the pension it thought it was paying for? The pensions are ‘too expensive’; they are suddenly means-tested, and paid at ever later ages.

Not least, let it be clearly understood that ‘right’ (to the pension) and ‘contract’ are two more good words that have been made misnomers. A ‘right’ to a pension that a man acquires by saving for it is unambiguous. The ‘right’ a man has to an income when he can no longer work is of a different kind. The word has been re-defined to mean a moral right or claim on society. But transfers of income from one age-group, or class, or generation, to another represent decisions by one group, or class, or generation, to help another in time of need. No group, or class, or generation has a ‘right’ in any absolute sense. ...

In civilised parlance ‘contract’ means a voluntary agreement between two parties each of whom thinks it will gain. There is no such voluntary agreement between the generations on pensions. Indeed, there can hardly be one since future generations cannot be consulted; and if they could they would hardly agree since the terms are loaded against them. (pp.129-130)

* * *

Retrospective legislation has become increasingly frequent, and by now no one seems to remember that there was ever anything against it. It used to be said that the individual had a right to know what was legally open to him (in taxation, etc.) so that he could plan his affairs to secure the best outcome in view of his own interests and priorities, as he conceived them to be.

The recent changes in the ages at which state pensions become payable is really an egregious example of retrospective legislation, and directly affects people in as bad a position as we are. If a company which offered pension schemes were suddenly to announce that all its pensions were to be paid two years later, those who had been paying into the schemes might well wish to sue it for breach of contract. When the government does the same thing, no legal redress is available. This has happened recently and seems likely to happen more, so that my junior colleagues’ pensions recede as one approaches them. The age at which one of them will start receiving her pension was first shifted from 60 to 62, and then again to 64. Another’s pension was shifted from 65 to 67, and seems likely to be further delayed to the age of 68.

Thus the state has already deprived us, who are trying to build up towards an adequate academic institutional environment, of seven years’ pension money, i.e. £35K at today’s pension rate.

I have previously pointed out how means-testing of pensions retrospectively reduces the benefit received in return for contributions paid. This means nearly two thousand pounds per person per year. The proposed tax of £20K towards the cost of state ‘nursing care’, whether such care is received or not, was first proposed as a tax on estates on death, but is now suggested as a capital levy to be paid by every pensioner on reaching retirement age. If that were made retrospective, so that it applied to myself as well as to my colleagues, that would represent an additional confiscation of £80K.

‘There are several other examples of abandonment of principles, and I should be able to write about them at length because they are extremely serious, though no one else appears to recognise this. If Oxford Forum were provided with adequate funding, we could be writing and publishing analyses on this issue of a kind currently ignored in favour of the usual pro-collectivist arguments.’ Celia Green, DPhil

‘We hereby apply for financial support on a scale at least adequate for one active and fully financed research department. We make this appeal to all universities, corporations and individuals who consider themselves to be in a position to give support to socially recognised academic establishments.’
Charles McCreery, DPhil


* Arthur Seldon, The Great Pensions Swindle, Tom Stacey Books, London, 1970. Arthur Seldon CBE was joint founder president, with Ralph Harris, of the Institute of Economic Affairs, a free-market think tank.

28 June 2012

Withering faster on the vine

After some years or decades of ‘withering on the vine’ it was announced first that state pensions would be means-tested, and then that the ‘basic’ state pension which remained would be increased each year in line with the CPI (Consumer Prices Index). This is less than if the increase were based on the RPI (Retail Prices Index) which includes the cost of housing, presumably because it is supposed that if you are poor enough you can apply for housing benefit, so your pension should not need to include your rent, mortgage, house repairs etc.

Not only that, but the CPI can be manipulated in various ways, one of them being to arrange for individual suppliers to operate means-testing. Electricity and water suppliers are to supply more cheaply to ‘poorer’ customers. Supermarkets are to keep down the cost of the cheapest and most basic foods so that price rises will be made only, and more steeply, on higher-quality or more nutritious foods.

Now the threatened increase in fuel tax is to be postponed from August to January. If it had started to apply in August, as was apparently planned, it would have affected the September CPI, on which the increases in next year’s pensions will be based.

In any case, it would have been a tax on motorists commuting to their jobs rather than on those who were excluded from academic careers and had to live as capitalists; or on pensioners, few of whom commute to jobs. Such a tax would be penalising the ‘working’ population more than the ‘independent’ population and that is presumably not what modern ideology favours. Independence is normally to be stamped out at any cost.

Those drawing pensions who will never apply for any means-tested benefit, such as myself, can derive little joy from observing the real value of their ‘pension’ shrinking year by year, ever further from a realistic cost of living, even leaving the cost of housing out of it.

Three or four decades ago I remember asking myself whether it was really good value to pay voluntary contributions towards the state pension when I had no salary. Might I not do better by putting aside an equivalent amount of money and investing it as favourably as possible? But, I thought, as probably many others did, there might be an unforeseeable Weimar-style inflation, and then the state would have to keep the pension at a realistic level, whereas one’s own investments might not keep pace with a very high level of inflation. So paying into the state pension was an insurance policy, protecting at least a small part of one’s money from erosion under all conceivable circumstances. So I thought, some decades ago.

07 June 2012

State pension: not enough to live on

The number of older people who will be forced to pay their own care bills will double over the next 20 years to more than a quarter of a million, a report said yesterday. It said spending constraints and growing demand for help will mean councils no longer provide any care apart from that which the law forces them to pay for. (Daily Mail, 30 May 2012)
A number of pensioners who are now struggling and suffering would not be, if the state pensions, for which they had qualified by paying the necessary contributions for up to 45 years, had not subsequently become means-tested.

In The Great Pensions Swindle, the author describes exchanges in Parliament from which one gathers that there was a strong emotional investment in the idea of paying ‘benefits’ only to those in ‘real need’, that is, those who would not have their freedom increased by the payment, as it would all be accounted for by outgoings necessary for staying alive.

At the time (about 1970) this did not suit the Government’s book, as they needed to justify raising the contributions made towards pensions, so as to have more money available for their favourite forms of expenditure, such as salaries paid to doctors, teachers, social workers etc. for their activities in reducing the freedom of others. Therefore it was necessary to talk as if a person’s contributions were paying for a certain level of pension, in a way that was comparable to previous commercial schemes.

By now, post-means-testing, few people remember what went on, or impressions that were created, around 1970.

People do not complain that they were given no warning that means-testing might come about. Certainly I was acutely aware of the difference between a benefit and a pension paid ‘as of right’ when I made the efforts necessary to pay voluntary contributions over 40 years, being usually unsalaried and unable to draw income support.

But, it may be objected, most people are not making a deliberate choice about paying or not. They pay automatically because they have a job which involves compulsory national insurance contributions, and so they cannot complain if the government subsequently changes its mind about what it will pay, or at what age it will pay it. However, while it is true that they may not think about the deductions from their pay packet, and may acquiesce in what is considered a sensible thing to do, they always might think about it, and do something else instead. And the consensus always might decide that salaried jobs with pension deductions were bad value, and it might become received wisdom that everyone should run a small business from home instead.
A fifth of workers are putting nothing into a personal pension, threatening poverty in old age. People are sacrificing saving for their retirement in favour of covering immediate bills such as mortgages, heating and food. The proportion of those who are saving the minimum needed into a personal pension to provide a comfortable old age has fallen to an all-time low of 46 per cent.

Pensions expert Scottish Widows ... said most people are hoping for a retirement income of £24,500 in order to provide a decent standard of living. (Daily Mail, 21 May 2012)
Various means-tested benefits are suggested, such as a few free stamps for Christmas cards, or going on a cheap ‘social’ tariff to be provided by energy suppliers. These would all involve an extra workload for salaried staff, who would need to interact with each applicant about the validity of his claim.

No one suggests that the pensions already paid for should be restored to a non-means-tested, and more realistic, basis. Discussing plans for a future non-means-tested pension, the Scottish Widows experts give £24,500 p.a. as the amount that most people hope for on retirement to provide a decent standard of living.

The present basic (non-means-tested) state pension is less than £5,500 p.a., so that the gap is considerable. If the present basic pension were raised to, say, £20,000 p.a., a considerable number of pensioners could be relieved of extreme pressure, conceivably at less cost to the taxpayer than relieving the same number by complicated schemes to provide marginal relief with specific expenses, such as bus fares, Council Tax, heating, meals on wheels, etc.

But the reason that people do not like this idea is that some pensioners, who have other pensions, or a certain amount of capital, might have some money (i.e. freedom) left after the most basic expenses. And we know that the ‘fair’ society is one in which there is no freedom at all for anyone. The average voter, I expect, is far more interested in absolute fairness, in this sense, than in the cheapest method of providing for certain types of distress.

28 April 2012

Selective laying bare

State-funded pensions will cost £5 trillion, today's Daily Mail informs us.

Laid bare for first time, £180,000 burden facing every British family
(headline, 28 April 2012)

But why is this being ‘laid bare’ for the first time, one wonders, and not any of the other burdens facing the British taxpayer? Such as, for example, the cost of social workers to take babies away from their families and shuffle them around from one foster family to another? The cost of paying foster families ‘child maintenance’ for having kidnapped children living with them? The cost of providing free ‘education’ for every child born to immigrant parents and other categories of parents?

The object, one supposes, is to justify new forms of taxation; the population of people of pensionable age, being one with average IQ above that for the population as a whole, is the ideal target to be blamed for the ever-rising costs of ‘social services’, and to be made to pay as much as possible in the way of extra tax. Presumably pensioners, especially those who are not public employees (doctors, teachers, social workers, etc) are to be as impoverished as possible by the time they die. Otherwise they may leave houses and other assets to their offspring, who are also likely to have above-average IQs. Heredity may be unmentionable in polite society (David Willetts), but there is some sensitivity to the fact that high-IQ parents may have high-IQ offspring. Even before they die, high-IQ parents may give positive assistance to their high-IQ offspring, if their financial resources, in the way of both income and capital, exceed their most basic needs.

If my father had had a normal pension at the end of his teaching career, he would have been able to give me financial support at a level which, in view of my lack of an academic salary or of income support, would have been appreciable and have at least slightly eased the pressures of constriction which were oppressing my attempts to remedy my position as an outcast. This was the position into which I had been thrown at the end of the ruined ‘education’, although it was universally assumed that I had turned my back on a university career voluntarily. ‘Oh, I thought you got what you wanted,’ my aunt gasped half a century later, having apparently assumed that whatever I found to do in exile must have been something that I wanted to do so much that I would prefer doing it in destitution and degradation, rather than having a high-flying university career.

The question of ethics with regard to pension policy is one of the issues on which critical analyses could be being published by Oxford Forum if it were provided with adequate funding to do so.

18 April 2012

The Great Pensions Swindle

I have a book entitled The Great Pensions Swindle* which, 40 years ago, made some useful points about the likely unreliability of state pensions. The following, however, is unrealistic:

The breaking point is not postponable indefinitely. The resistance to periodic increases in ‘social insurance’ contributions will begin all the sooner when the ‘contributors’ realise they are paying not insurance contributions but an income tax. (p.128)

In fact, no significant realisation arose that “National Insurance” contributions were just a form of income tax, which increased the Government’s current spending money. Otherwise the book anticipates very much what has happened. What happens when a future generation decides it prefers to spend its money on what is fashionable at the time (overseas ‘aid’, social workers, ‘universities’, etc.) rather than providing a former generation with the pension it thought it was paying for? The pensions are 'too expensive'; they are suddenly means-tested, and paid at ever later ages.

Not least, let it be clearly understood that ‘right’ (to the pension) and ‘contract’ are two more good words that have been made misnomers. A ‘right’ to a pension that a man acquires by saving for it is unambiguous. The ‘right’ a man has to an income when he can no longer work is of a different kind. The word has been re-defined to mean a moral right or claim on society. But transfers of income from one age-group, or class, or generation, to another represent decisions by one group, or class, or generation, to help another in time of need. No group, or class, or generation has a ‘right’ in any absolute sense. ...

In civilised parlance ‘contract’ means a voluntary agreement between two parties each of whom thinks it will gain. There is no such voluntary agreement between the generations on pensions. Indeed, there can hardly be one since future generations cannot be consulted; and if they could they would hardly agree since the terms are loaded against them. (pp.129-130)
* * *

Retrospective legislation has become increasingly frequent, and by now no one seems to remember that there was ever anything against it. It used to be said that the individual had a right to know what was legally open to him (in taxation, etc.) so that he could plan his affairs to secure the best outcome in view of his own interests and priorities, as he conceived them to be.

The recent changes in the ages at which state pensions become payable is really an egregious example of retrospective legislation, and directly affects people in as bad a position as we are. If a company which offered pension schemes were suddenly to announce that all its pensions were to be paid two years later, those who had been paying into the schemes might well wish to sue it for breach of contract. When the government does the same thing, no legal redress is available. This has happened recently and seems likely to happen more, so that my junior colleagues’ pensions recede as one approaches them. The age at which one of them will start receiving her pension was first shifted from 60 to 62, and then again to 64. Another’s pension was shifted from 65 to 67, and seems likely to be further delayed to the age of 68.

Thus the state has already deprived us, who are trying to build up towards an adequate academic institutional environment, of seven years’ pension money, i.e. £35K at today’s pension rate.

I have previously pointed out how means-testing of pensions retrospectively reduces the benefit received in return for contributions paid. This means nearly two thousand pounds per person per year. The proposed tax of £20K towards the cost of state ‘nursing care’, whether such care is received or not, was first proposed as a tax on estates on death, but is now suggested as a capital levy to be paid by every pensioner on reaching retirement age. If that were made retrospective, so that it applied to myself as well as to my colleagues, that would represent an additional confiscation of £80K.

There are several other examples of abandonment of principles, and I should be able to write about them at length, because they are actually very serious, although no one else appears to recognise this. If Oxford Forum were provided with adequate funding, we could be writing and publishing analyses on this issue which are currently being ignored in favour of the usual pro-collectivist arguments.

* Arthur Seldon, The Great Pensions Swindle, Tom Stacey Books, London, 1970.

[First published 11th September, 2010]

28 March 2012

Another benefit financed by defalcation

I see that those on pension credit (the means-tested supplement to the basic state pension), along with others receiving benefits, are to be able to buy a certain number of Royal Mail stamps at reduced prices.(Daily Mail, 28 March 2012.) The cost of this, including the cost of time spent by Post Office staff, will have to be borne by someone, presumably by those not on pension credit or receiving any other benefit, when next the prices of stamps are raised.

When pensions were declared to be means-tested this was effectively turning the state pension system into a ‘benefit’, instead of a payment made ‘as of right’ to those who had made the specified number of contributions.

It was on that basis – the payment ‘as of right’ basis – that I paid into the state pension system for over 40 years, without entertaining any fears of eventual means-testing. Being deprived of a salaried career and even of eligibility for the so-called social security on account of my ruined education, I had virtually no income and paid voluntary contributions to the state pension scheme to reduce, at least by a small amount, my disadvantage relative to salaried academics.

Even if the threat of means-testing had been bruited, I would have thought it unlikely to affect me, since, having no academic appointment, I had no other pension expectations and negligible income from any source.

Having finally qualified for the state pension, and still being without a salaried career, I was horrified and shocked to find that my pension was now to be means-tested and that I would not be eligible for the supplementary ‘pension credit’ even if I was prepared to apply for it as a ‘benefit’. This was because I had devoted all my attention to building up capital to provide myself with a roof over my head. If I had not bought the house I lived in, I would have had no income with which to rent one.

Now that the emphasis of the means-testing is shifting from income to capital, I find that I have too much of the latter to qualify for ‘pension credit’, since I was never able to depend on income and had to build up capital as best I could. I see that those on ‘pension credit’ are to be able to buy cheaper postage stamps, apply for cheaper energy on ‘social tariffs’ and no doubt in many ways spend less on fundamentals than if they were not on ‘benefit’, thus increasing their advantage relative to me.

At the same time, others of my unsalaried colleagues who have fully qualified for their pensions by making voluntary contributions, see them receding into a distant future, and expect them to be means-tested even when they start to be paid.

The question of ethics with regard to pension policy is one of the issues on which critical analyses could be being published by Oxford Forum if it were provided with adequate funding to do so. Meanwhile, the idea that it is 'fair' to redistribute from better-off to worse-off pensioners is likely to receive reinforcement from pseudo-research published by the universities.

03 March 2012

No relief for 'those with the broadest shoulders'

A recent article from the Daily Mail on the Government's plans for pensions tax relief:

Higher earners should lose higher rate tax relief on pension savings, Treasury Chief Secretary Danny Alexander believes. The Lib Dem Cabinet Minister says the Government cannot afford to keep paying such a generous allowance on retirement investments. The changes, which could be included in next month’s Budget, would affect those who pay the 40p higher rate of tax, which kicks in at around £43,000. Currently, of every £1 they save in a pension, the Government contributes 40p in tax relief. That would fall to 20p in line with the basic rate of income tax.

The raid could cost middle-class pensioners up to £7billion a year, and discourage many from saving towards their retirement. If the cut was restricted to those earning over £100,000 a year, it would still save the Treasury £3.6billion. Mr Alexander told the Daily Telegraph: ‘If you look at the amount of money that we spend on pensions tax relief, which is very significant, the majority of that money goes to paying tax relief at the higher rate.

‘It's very important that in these difficult times we are asking those with the broadest shoulders to bear the greatest share of the burden.’ Mr Alexander also repeated his aspiration to raise the threshold at which people start paying income tax...

Lib Dem demands are expected to be raised at a meeting on the Budget next week between David Cameron, Nick Clegg, George Osbourne and Mr Alexander. The raid on pension tax relief may meet resistance from Mr Osbourne, who has stressed the need to avoid raids on the wealthy because they could deter successful businessmen from living in the UK. (Daily Mail, 11 February 2012)

The plight of pensioners is a constant focus of attention, although it is difficult to believe that the increases in life expectancy and cost of living can be a major factor in the constant rise in public spending. It is, surely, the increases in expenditure in favoured areas which make it impossible to ‘afford’ state pensions at a level commensurate with the cost of living. In fact, pensions were hit by the retrospective introduction of means-testing, and also by years of ‘withering on the vine’ with rises per annum which were inadequate to match the real rises in the cost of living, let alone in the cost of things which pensioners were more likely than others to need on a socially recognised basis, such as live-in housekeepers and attendants.

We may be sure that there is no real sympathy with this population, with an above-average IQ and a limited voting life ahead of it. Attention to its problems and claims that ‘something must be done’ are actually designed to justify new forms of taxation, the need for which is predominantly created by expenditure on increasing populations with IQs below the general average.

The objective is to justify additional taxation of this above-average population. In the extract quoted above there is one explicit proposal for how this might be done, although the additional taxation is presented as withdrawal of a tax relief, and it is pointed out that the ‘tax relief’ saved will be mainly at the expense of the population of those with the highest incomes, which is also (very likely) a population with a higher average IQ than other pensioners.

Those with ‘the broadest shoulders’ (the highest average IQs) should bear the greatest share of the burden which results from an ever-increasing transfer of resources to populations with below-average IQs.

The following is a re-blogging of part of an earlier post. In light of the article above, I have felt it necessary to reiterate the key underlying issues.

Further misdirection of attention is in asserting that it is not ‘fair’ that those who go into ‘care homes’ should have to sell their houses (if they have them) to pay for the ‘care’ they receive. This, of course, will lead to families being deprived of their inheritance.

Families are said to be ‘betrayed’ by care home funding, which leads to many pensioners being forced to sell their homes. This is described as a ‘scandal’, and it is hoped that a ‘fairer’ system can be devised. This rhetoric in itself should make one aware that a misdirection of attention is involved.

The population of those who reach pensionable age, and have homes to sell, are a population with an above-average IQ; so will their offspring be. So surely the modern mind can see nothing ‘unfair’ in a relatively high-IQ population being deprived of the inheritance it might have had from its parents, also with (statistically) above-average IQs. It is the obtaining of advantages from a previous generation of above-average people which is regarded as unfair, surely? How can ‘fairness’ be increased by transferring assets from one relatively high-IQ population to another?

And so we infer that these expressions of concern that homes will be lost to some of those who might have inherited them must have an ulterior motive. What is presumably aimed at is justification for an additional tax of some kind, resulting in the usual transfer of resources to a relatively low-IQ population.

It is suggested that what a pensioner pays towards his care home fees should be ‘capped’ with ‘the state stepping in’ to pay the rest. That means taxpayers stepping in to pay the rest, including pensioners who do not go into care homes. ‘In a further blow Health Secretary Andrew Lansley refused to rule out a pensioner tax to pay for old age care.’ Aha! This idea - an extra tax on those above retirement age, mooted in the Dilnot Report - approaches more closely the principle of transferring assets from the relatively high to relatively low IQs.

The population of pensioners who do not go into care homes at all may be expected to have higher average IQs than those who do go into them and have homes they might be required to sell, because the former are likely to have better genetic constitutions, have lived more prudently and/or successfully, or because they have devoted relatives, which are all factors likely to be correlated with high IQs.

So it may be seen as ‘fair’ that those pensioners who do not go into care homes should be taxed in order to transfer assets to those who do go into them.

This is no doubt the real reason for blaming the rise in life expectancy of pensioners for the increasing costs of the NHS, so that as usual a population of people with above-average IQs can be penalised for the benefit of a population with below-average IQs.

As for changing demographics, figures for life expectancy are usually quoted in relation to specific ages. E.g. people who are 50 now have a life expectancy of so much. But by the ages one sees quoted, the majority of those with a low life expectancy at birth are likely to have died off, although not before being a considerable drain on the NHS, state education (with ‘special needs’ tutors?), etc. Clearly these are an important part of the real demography, usually left out of the discussion. Those who are still alive at pensionable age (a population with a relatively high average IQ) are certainly not responsible for the rise in the costs of the NHS caused by the genetically dysfunctional (a population with a low average IQ).

02 December 2011

Hitting the high-IQs (as usual)

There are complaints that George Osborne’s ‘Austerity Budget’ fails to provide sufficient protection for ‘the most vulnerable’ sections of the population. Populations regarded as ‘vulnerable’ and ‘deserving of protection’ are highly correlated with ‘populations with the lowest average IQ’.

Confirming that most benefits will rise in line with inflation, Mr Osborne insisted the move was ‘fair and affordable’ and would protect the most vulnerable in society.

The Chancellor is understood to have stuck to plans to uprate benefits after seeing polling which confirms that capping or freezing benefits for the unemployed or other groups – such as the disabled – would be very unpopular. (Daily Mail, 30th November 2011)

Pensioners have always been a useful target for cuts in benefits and increases in taxation as, whatever modifications are made in living circumstances, the population which reaches pensionable age continues to have an average IQ which is higher than that of the population as a whole.

The result of such cuts is that this population will have less money with which to provide support and assistance for its offspring, and reduced assets to leave to them. And, if there is a genetic component to IQ and associated characteristics, reducing the advantages of this population will tend in the direction of reducing the proportion of the population as a whole which has above-average IQs.

Similarly, a population which has its income reduced by the austerity budget is that of those earning over a certain amount (£40,000 p.a. or in some cases £26,000) who will no longer be eligible for child benefit. Those with lower incomes will continue to receive child benefit, in fact it will be increased by the full rate of inflation as measured by the CPI.

Thus those who ‘need’ it most will continue to receive it. Those who have incomes above a certain level will no longer do so, but they are supposed to ‘need’ it less.

It may be noted that this achieves a further shift of resources from a population with a higher average IQ to one with a lower one, and (if there should happen to be an inherited element in IQ) this will, as usual, tend in the direction of discouraging those with above-average IQs from having large, or perhaps any, families.

So the rate at which the proportion of low IQs in the population is rising will once more be increased.

The age at which pensions become payable is of course to increase, and we may expect that it will be progressively increased in the future, thus penalising those who have successfully survived to a certain age (albeit in some cases with expensive assistance from the NHS), and who are therefore likely to constitute a population with above-average IQ.

Mr Osborne insisted the changes were vital as life expectancy continues to increase. He said that standing still was not an option, warning that the cost of paying the state pension is going to become ‘more and more unaffordable.’

What is meant by ‘affordable’? Apparently something cannot be afforded if it can only be paid out of money left over when other, supposedly ‘ring-fenced’ obligations have been met. Does the rise in life expectancy have a great deal to do with the ever-rising costs of the NHS, schools and universities, and other ‘social services’? Every child that is added to the population is an immense potential burden on the taxpaying population; those which are genetically dysfunctional the most.

The cost of the dependent population, which includes those who are dysfunctional by reason of low IQ, is certainly increasing much faster than the cost of supporting pensioners is increasing by reason of a lengthening lifespan.

Once again the (relatively high-IQ) population of pensioners is a convenient scapegoat, and is penalised to offset the massively increasing costs per generation of the dependent population, which on average seems likely to have a lower average IQ than that of the pensioners.

The relevant departments of my unfunded independent university are effectively censored and suppressed. They have been prevented for decades from publishing analyses of the complex issues involved, while misleading and tendentious representations of them have continued to flood out from socially recognised sources. I hereby apply for financial support on a scale at least adequate for one active and fully financed university research department, to all universities, and to corporations or individuals who consider themselves to be in a position to give support to socially recognised academic establishments.

20 October 2011

New definitions for ‘saving’ and ‘planning’

As I have previously said on this blog, the state now appears to feel free to change legislation in ways that are effectively retrospective, in that they make a mockery of past efforts by forethoughtful taxpayers – such as myself and my colleagues – to plan for their life after normal retirement age.

Commentators whom one might expect to be critical of such retrospectiveness seem to share the basic philosophy that it is not too unacceptable, sounding mildly disapproving at best but in many cases simply taking it as read that, say, the presence of a budget deficit justifies breaking what was once thought of as a relatively sacrosanct principle.

Ruth Sunderland, for example, refers to the complaint made by many women that the rapid shifting of the age at which they will start to receive their state pensions ‘simply does not leave them enough time to plan’. But she does not appear to complain of the sudden introduction of means-testing. Those who had been paying into the state pension scheme could not have planned for that change because it was retrospective, and they had no warning it was going to happen.

Having undermined savings efforts by breaking a principle in one area, the government evidently feels justified in breaking principles in complementary areas; for example, using the idea that it is legitimate to be forced to save.

In an alarming speech, Martin Weale [a leading expert at the Bank of England] urged Britons to wake up to the fact that their level of saving is too low and that they are spending too much. ... The top economist said people were deluding themselves about the type of retirement they could expect, unless they were happy to work ‘much later’. ...

Starting next year, new rules will force all bosses to pay into a pension for their workers for the first time, unless the worker decides to opt out. ... Pensions minister Steve Webb said ... ‘Our workplace pension reform is vital. From 2012, automatic enrolment will mean millions of people saving into a pension for the first time, with a contribution from their employer.’ (Daily Mail, 26 August)

Having one’s money confiscated is not the same as saving, even if money is also confiscated from your employer at the same time, thus surreptitiously reducing the resources which he has available to pay you directly.

If this money were not confiscated, those who wished to save in the normal sense of the word, i.e. build up their own capital, might use it to do so. Hence this legislation is reducing the possibility of savings being made.

Theoretically the money will be preserved from the irresponsible activities of those who might wish to use it for something else before reaching what the government of their day decrees to be ‘retirement age’. Possibly those who might choose to act in this way do so knowing that their family history indicates the likelihood of their dying before receiving anything in the way of retirement pay; or having decided, consciously or unconsciously, to get lost on a mountainside somewhere and die of exposure before they suffer from the drawbacks of ageing.

At a time when the national finances are under severe strain, later retirement ages for both sexes are unavoidable. ... Pension planning is a long-term undertaking that ideally should be carried out over an entire working lifetime. (Ruth Sunderland, Daily Mail, 14 October)

Later retirement ages are only ‘unavoidable’ if you rule out such possibilities as abolishing state education, child benefit at all levels of income, the NHS, etc.

And you can only plan with money that is in your own hands.

In my twenties, being deprived of the possibility of earning a living as an academic, unable to envisage earning a living in any other way, and also deprived of the possibility of income support when receiving no income from any employment, I made great efforts to ensure that I would pay the voluntary contributions into the state pension scheme. In deciding to do this, rather than to keep an equivalent amount in my own hands and invest it as best I could over the years, I was considerably influenced by the fact that the state pension was paid ‘as of right’ as a result of contributions made, and was not a ‘benefit’ supposedly related to your ‘needs’ as assessed by agents of the collective.

I paid in contributions every year over a period of about forty years, and had started to receive a disappointingly withered pension, when it was announced that state pensions would now be means-tested. Some years later it was announced that the age at which people would receive them was not what they had previously expected, but was liable to shift forward at the whim of the government.

So my attempts to ‘plan’ for my income after the age of 60 had been misguided, as I had not taken into account the possibility of retrospective legislation.

13 July 2011

An amazing sleight of hand

Andrew Dilnot will propose a cap of between £35,000 and £50,000 on the amount people have to pay towards their care in their last years – with the taxpayer picking up the balance. His proposals would leave the Treasury with an estimated bill of more than £2bn – which would have to come from taxation or cuts elsewhere in Whitehall. (Independent, 4 July 2011)

By an amazing sleight of hand, the Dilnot proposals to tax other pensioners more, in order to ‘cap’ the amount which has to be paid by those who go into care homes, are represented as compassionate towards the middle class, and towards the ideas of thrift and inheritance.

‘Life is littered with potential financial catastrophes, from costly-to-treat illnesses to house fires, but in most cases the risks are pooled, whether through the state or the insurance market,’ said The Guardian. When it comes to care, those with more than £23,250 are on their own facing potentially unlimited liabilities. The results are ‘dire’. So Dilnot’s plan is very welcome, as a way of ‘staving off ruin for an unlucky minority’...

It’s easy to see the Dilnot report as a ‘caring and sharing’ left-wing proposal, said Daniel Finkelstein in The Times: a ‘market failure is being corrected’ by a new social insurance scheme (and a new tax). But I think this is wrong. It is not, in fact, about looking after vulnerable people. ‘It's about insuring the inheritance of their children: the state will protect the assets of quite wealthy people from the possibility that they will be used up to pay for their care’, and thus not be available for their relatives to inherit. (From article ‘The cost of growing old’, The Week, 9 July 2011)

Now we know that nobody cares about unlucky minorities, especially those with higher-than-average IQs, and we know also that inheritance is almost as deplorable an idea as heredity.

The several billions a year which the Dilnot scheme would cost the taxpayer (we may assume with some confidence that £3.6bn is a conservative estimate) could be covered, he suggested, by a ‘specific tax increase’ on pensioners.

Whether or not these billions, which would be necessary to cap the care home costs of an ‘unlucky minority’, would be confiscated from other pensioners or from some other part of the taxable population, it should be pointed out that, instead of capping care home fees, the billions might be applied to reversing the means-testing of pensions and raising them to a more realistic level. Those who did go into care homes would then have more funds available to pay towards their own care, but not, of course, so much as if they were (as is intended) the sole beneficiaries of the billions.

In the Oppressive State, all sections of the population with above-average IQs are to be destroyed. So one starts by hating capitalists and landowners who would not be in the positions they are if it were not for above-average functionality and realism on the part of themselves and their ancestors.

But if they are torn down you still have some people of above-average functionality in the population, whose ability and conscientiousness have not yet got them into favourable positions. Before the advent of the Oppressive State in 1945 it was probable that a person who reached the age of sixty fell into this category. They were likely to have a good genetically determined physical constitution and to have avoided the hazards of life which might have led to their death at an earlier age. So they were likely to be realistic, conscientious, forethoughtful and independent-minded. That is, they were likely to be the sort of people that the Oppressive State seeks to destroy.

So you would think it would seem quite a good idea to believers in the modern ideology that pensioners should have their assets reduced to zero, so that there is nothing for their children to inherit.

But if the population of pensioners is split into those who run up significant costs in ‘care’ versus those who do not, and it now appears that the former population is likely to have a lower average IQ than the latter, there is in fact a motive for penalising the latter to reduce costs on the former.

Otherwise one cannot see why believers in the modern ideology should see anything against the idea of the assets of a pensioner being reduced to zero. Ah, but if there is a population with an even higher average IQ that can be penalised to prevent this – then it is an opportunity for a further tax.

We may suppose that now university graduates are so heavily penalised (unless they have a good probabilistic claim to a relatively low IQ), the pensioners are the only remaining population with an above-average IQ which can be squeezed still further. But why is this necessary? Pensions have been withered on the vine for decades and cut by means-testing, so why now propose an extra tax on them to reduce the charges on those who go into care homes?

A possible explanation arises from the fact that the population of pensioners has now become sufficiently differentiated in IQ for a transfer of resources from one section of this population to another to fulfil the criterion that all ‘benefits’ should constitute a transfer of assets from a population with a higher average IQ to a population with a lower one.

08 July 2011

Withered on the vine

The state pension was cut (made means-tested) in 2003. Those who were already receiving it, such as myself, or who were within sight of qualifying to receive it, such as some of my colleagues, had been paying into it for several decades during which there had been no hint that it would ever be cut (means-tested) although for some time state pensions had been described (apparently officially) as ‘withering on the vine’, and attempts to increase them in line with inflation or the national wage had presumably lapsed, although I had not been paying attention to what was going on. At any rate, the pension which I started to receive in 1996 was pathetic, bearing no relation to pensions in private schemes or to average salaries. It was increased each year by nugatory amounts, so that the gap between it and a realistic pension appeared to widen rather than be decreased.

In 2003 it was announced that state pensions were to become means-tested, the concept having apparently metamorphosed from that of a replacement for a salary to that of a benefit whose purpose was to save the most needy from starvation. The basic state pension itself was to fall in real terms, and it was no consolation to me that if I became poor enough I could apply for pension credit. This was something I would never do.

Probably many had (and have) the same aversion to this idea as I had myself, although in a less clear-cut form, and the failure (or refusal) of many to apply for benefits to which they were entitled has been ascribed to ‘pride’ or to the complicated nature of the forms to be filled in. (Snooping systems are now being set up to identify hidden carers and hidden cared-for, to induce them to apply for ‘benefits’.) When some element in living costs rose noticeably, optional bits and pieces for special purposes (such as for council tax and the winter fuel payment) were sent in addition to the pension, but not guaranteed to continue indefinitely.

The Coalition commenced its era of reform, announcing that the state pension would now be increased per annum in accordance with wages, the CPI, or 2.5 per cent, whichever is highest. This is called the triple lock. Cunningly, the government chose to use the CPI (Consumer Price Index) and not the RPI (Retail Price Index) which at the time was higher than all three.

Now that the withered state pension was rising by this guaranteed amount each year, the bonus for council tax could vanish. As energy prices were rising dramatically, proposals to scrap the winter fuel payment were opposed, and it remained, but has now been cut from £250 per annum to £200.

So the rises in the state pension have been offset by the loss of these temporary subsidies, and the rises in the amount actually received each year by an individual who chooses not to expose himself to state assessment by applying for top-up benefits are correspondingly reduced. Clever!

07 July 2011

More misdirection of attention

‘The Mail accepts that, with people living longer, we must pay more towards the cost of our old age.’ (Daily Mail, editorial, 5 July 2011)

Similar things have been said by people associated with Saga and other organisations for the over-fifties.

This is just accepting and reinforcing the misdirection of attention. The Government needs more money to spend and the costs of all its favourite indulgences are no doubt expanding exponentially. But the causes of the explosive growth of expenditure are wrapped up in the classifications of the imaginary society supported by public money (i.e. by taxation – freedom of action confiscated from individuals.) How far do the costs of ‘education’ and the NHS arise from the ever-growing population of the genetically dysfunctional, many of whom can never support themselves in the sense of earning money, even in such fictitious capacities as those of social workers, tea ladies in hospitals, psychiatrists, playgroup supervisors, etc.?

This population has grown geometrically since the sectors of the population most likely to produce dysgenic offspring have increased with every generation, while those least likely to produce them, the so called ‘middle class’, have dwindled as they faced ever-increasing disincentives to having children.

The object of modern society is to destroy those with above-average IQs and/or aristocratic genes. The populations which have the highest average IQs are the only ones that deserve to be taxed – in the view of the modern ideology.

This has already been demonstrated by the onslaught on university graduates, still a population with, overall, a higher than average IQ. The pensioners are vulnerable because those who live longest have relatively high IQs and general functionality.

This is why they should be taxed, not because their living longer than before is a dominant factor in the rising costs of the NHS, the ‘educational’ system, etc.

The associations which are supposed to represent the interests of high-IQ populations, such as Mensa and the National Association for Gifted Children, make no attempt to defend those interests or to protest against a system that is geared against them. The same is true of the associations which are supposed to represent the interests of the elderly; their leaders acting as agents of the collective in keeping the victims quiet and compliant. The members of their associations could be forming pressure groups or, better still, forming cooperative organisations to keep the Welfare Wolf from the door.

Members of the associations mentioned are invited to move to Cuddesdon, and might appreciate the advantages of forming their cooperative associations around us as a nucleus.

04 July 2011

Paying for others to enjoy a fate worse than death

It is said that the Dilnot report will recommend that people of pensionable age should not have their assets reduced by more than a third by paying for ‘care’ from the state. This does not reassure me at all, since I know that both I and any of my associates would regard exposing ourselves to state ‘care’ as to be avoided at any cost. Going into a ‘care home’ would indeed be a fate worse than death.

What does worry me is what new tax will be proposed to pay for the ‘care’ that the state does get to impose on people. There are many forms of benefit which are lavished on favoured sections of the population which could easily be cut and replaced by repayable loans, but of course it is only the population of pensioners which is to be penalised.

For example, if nurseries, crèches and supervised ‘play groups’ for the under-fives were abolished, and children could not start school until five (or even six or seven?), a good deal of taxpayers’ money would be saved and parents would be discouraged from having more children than they could manage to look after themselves. As it is, the burden of looking after their children is greatly reduced by the proportion of their time that they spend out of sight, out of mind, at school. ‘Social help’, which I believe is provided for families burdened with too many children, could be cut completely or provided only on payment, as ‘social care’ for the elderly is now. ‘Housing benefit’ is also related to family size, and could be provided in the form of repayable loans, similar to the loans made to university graduates.

Reducing the provision of nursery schools might also reduce the cost of ‘education’ at higher age levels, since it would tend in the direction of making parents aware of the advantages of keeping their families down to a more manageable size. Formerly, parents were responsible not only for feeding and looking after their own children, but also paying for schools if they wanted their children to attend them.

If parents were not relieved of much of the burden of looking after children, the saving to the taxpayer could probably be sufficient to reverse the cut in the state pension (euphemistically described as ‘means-testing’) and to increase it to a realistic level which would be sufficient for a high proportion of its recipients to provide themselves with adequate housekeeping and other services, or to have friends or relatives living with them, independently of the state.

Paul Burstow (Care Services Minister) refers to ‘social care’ as having a ‘nasty little secret’. ‘It is not free and never will be free.’ Quite right. That is the ‘nasty secret’ of all state benefits. As I said of my state-funded education, it was not free. It was paid for with the ruin of my prospects in life, the ruin of my parents’ lives, and the gratification that all agents of the collective, official and unofficial, could derive from so satisfactory an outcome.

Chancellor George Osborne is resisting the plans because he believes they are too close to the ‘death tax’ proposed by Labour before last year's general election, under which everyone would have paid £20,000 into a compulsory insurance scheme whether they eventually need care or not. But Deputy Prime Minister Nick Clegg and Lib Dem care minister Paul Burstow are both supportive. (Daily Mail, 27 June 2011)

So we know that Paul Burstow is in favour of something close to the former idea of £20,000 ‘compulsory insurance’. How does he put it according to the Daily Mail (2nd July)?

[Mr. Burstow] promised that while the elderly will be expected to contribute, they will not pay as much as many of them have to pay now.

I.e. while those of pensionable age (including those who do not, and would not, have anything to do with ‘social care’) will be forced to contribute, they will not pay as much as many of them (that is, many of those who do go into ‘care homes’) have to pay now.

It is true that £20,000 (the starting figure proposed for the ‘compulsory insurance’ suggested by Labour) is ‘not as much’ as various amounts in excess of £50,000 which are currently being paid by many of those who fail to protect themselves from ‘social care’.

But why should those who do not and never would submit to ‘social care’ be forced to pay this tax, which is supposed to justify putting a ‘cap’ on what is paid by those who do?

They have already had their pensions drastically reduced because the cost of providing for pensioners is supposedly so great. Saying that a pension is ‘means-tested’ is just a euphemism for calling it ‘reduced’ (or ‘cut’), which is what it is, so far as I am concerned, as I would not seek an income supplement for which I had to be ‘assessed’ by agents of the collective, even if I might be supposed to be eligible for it. I was only so persistent in paying in voluntary contributions for so many years because I thought the resulting pension would be paid to me as of right.

The relevant departments of my unfunded independent university are effectively censored and suppressed. They have been prevented for decades from publishing analyses of the complex issues involved, while misleading and tendentious representations of them have continued to flood out from socially recognised sources.

I hereby apply for financial support on a scale at least adequate for one active and fully financed research department, to all universities, and to corporations or individuals who consider themselves to be in a position to give support to socially recognised academic establishments.


29 June 2011

A short life and a merry one

In about 1970 they ‘upgraded’ the state pension system; the real motive for this being that they wanted an excuse to get in more money for the government to spend as it pleased. To justify the increased taxation involved, it was necessary to talk as if a person’s contributions were paying for a certain level of pension, in a way that was comparable to previous commercial schemes.

Actually of course this idea lapsed into oblivion over the decades, and the idea of a pension metamorphosed into that of a ‘contract between generations’, with present taxpayers paying for the support of old and infirm former taxpayers, in the hope that doing so would gain them similar consideration from future taxpayers.

As a result, it becomes possible to complain about how many pensioners there are in relation to present taxpayers, and how much each taxpayer is having to contribute. And once again, providing for pensioners can be used to justify an increase in taxation, more money rolling in for the government to spend on its favourite things, which are all oppressive (teachers, doctors, psychiatrists and counsellors, social workers, lawyers, policemen). Several of these sectors of the population are, I feel sure, increasing in size and expensiveness far faster than the population of pensioners. So, of course, is the population of immigrants, who are having a ‘baby boom’ of their own.

After a good deal of hullabaloo a ‘committee of enquiry’ concludes that pensioners must continue to pay for ‘care’ which they receive (or to which they are forced to submit) from the state. At least they must pay up to a certain amount, so long as they have any assets left, after which the state will pick up the tab. But even this limited liability on the part of the state is a grievous burden, and so we are still left with an excuse for creating a new tax in some shape or form.

Middle class pensioners should pay between £35,000 and £50,000 for their old age care, a review will recommend this week. ... At present, anyone with savings or assets above £23,250 - including property - has to pay for their care in full, forcing thousands to sell their homes. The review will raise that threshold so that more people with modest savings benefit, at a cost to taxpayers of around £3billion a year. But the middle classes will have to pay more. Mr Dilnot will recommend they pay between £35,000 and £50,000. ...

Organisations including Age UK, the British Heart Foundation and the Alzheimer's Society yesterday wrote to Prime Minister David Cameron urging him to accept the Dilnot proposals. They said: ‘The social care system has been in growing crisis for years. Our organisations deal every day with people at the most vulnerable points in their lives who are either not receiving any social care support or a small level of help that is grossly inadequate to their needs.’

‘We call upon the Government to take this opportunity offered by the Dilnot Commission and produce a White Paper in the autumn detailing how it will create a sustainable and fair social care system, including how it will be funded.’

Chancellor George Osborne is resisting the plans because he believes they are too close to the ‘death tax’ proposed by Labour before last year's general election, under which everyone would have paid £20,000 into a compulsory insurance scheme whether they eventually need care or not. But Deputy Prime Minister Nick Clegg and Lib Dem care minister Paul Burstow are both supportive. (Daily Mail, 27 June 2011)

It is said that people do not like thinking about the future (especially, probably, those with below-average IQs) and so do not save enough to provide for themselves when they are no longer earning money. Therefore they must be forced to do so, by having their money taken away by the government, and so must those who do think about their futures.

Perhaps most people do not want to think about what lies ahead, and intend, consciously or subconsciously, to end their lives semi-accidentally if things become difficult. Why not leave them to get on with it? If they have not provided for themselves, perhaps they have (consciously or otherwise) opted for ‘a short life and a merry one’, as one of my former dentists said of a colleague who had a liking for real ale and died soon after his retirement.

Why not leave them to it? How is it better for them to end their lives under medical supervision in a ‘care home’ prison, with complete loss of autonomy?

Why should you want those such as myself who do try to build up capital, to improve their future lives, to be made responsible for supporting those who have not been interested enough to support themselves – by confiscation of capital by the government? The population of savers is likely to have above-average IQs; in fact it may well include a significant proportion of people with exceptionally high IQs, who realise that they have no other chance of making their position less intolerable in a society that is motivated by hostility to people like them.

And that, of course, is the answer to why they should be penalised by confiscation, in theory because they are causing an intolerable strain on the government’s resources; in reality because the government ‘needs’ to continue expanding its spending at a rate of knots on less threatening populations which will never have any independence of thought or action.

It is disgraceful that organisations such as Age UK, Age Concern and Saga actively support the raising of the pension age and the Dilnot proposals. ‘The social care system has been in crisis for years’. Of course it has, and the only solution is to abolish ‘social care’ altogether.

And there is no solution for the country as a whole but to abandon the concept of ‘state benefits’ altogether. There is no ‘benefit’ without reduction of liberty, and the concept of the state as the ultimate provider can lead only to the destruction and bankruptcy of the society that adopts it.

06 June 2011

Keeping the Welfare Wolf from the door

The tiny amount of public spending committed to the elderly – 5.8 per cent of national income compared to 11.7 per cent in Italy – is a key reason behind the scandal of tens of thousands of people having to sell their homes every year to pay for their residential care.

Other countries fund care home fees through taxes or national insurance systems, meaning care is available when people need it. The report warns that our low spending rate has also led to an enormous burden on family members, who are left having to take on roles as unpaid carers because the state does not step in.

And it means thousands of pensioners are isolated in their own houses because not enough home helps, meals on wheels services and day centres are available. ...

The £16billion we spend each year includes funding for day centres, residential care home fees, meals on wheels and home helps who assist with eating, dressing, going to the toilet, washing, domestic cleaning and shopping. (Daily Mail, 6 June 2011)

I made the efforts I did over a period of fifty years to make sure that I and any associate of mine made voluntary contributions to the state pension, only because this seemed to be a way of getting an income as of right, since I knew I was not, and would never be, eligible for any state ‘benefit’, such as income support.

Now I find that everyone is advocating, not restoring the non-means-tested part of the state pension to something like adequacy, but providing more ‘home helps, meals on wheels services and day centres’ (ibid.) – all ‘benefits’ which I and anyone associated with me would never take up.

‘The shocking betrayal of the elderly’ (supposedly consisting not in the reduction and means-testing of pensions, but in the failure to provide ‘benefits’ to those who will tolerate them) is ‘revealed in a damning report’ by the over-50s group Saga, the Director General of which is Ros Altmann, who has never (so far as I can make out) shown any concern about retrospective legislation.

The report, Take Care, was compiled for Saga by the think tank 2020 Health, which analysed OECD figures.

These figures show how generations of British politicians have betrayed our increasingly ageing population and have failed to fund properly the care so many of them will clearly need,’ Mrs Altmann said.

Mrs Altmann does not mention the failure to fund properly the pensions which so many of them were led to expect they would receive without means-testing.

The report warns that our low spending rate has ... led to an enormous burden on family members, who are left having to take on roles as unpaid carers because the state does not step in.

The burden on those who want to keep the Welfare Wolf from the door, and to avoid the state ‘stepping in’ to their lives, could only be reduced by raising the non-means-tested state pension to which I contributed for so many years. On the other hand, increasing the availability of benefits for which I would never consider applying, even if I might be considered eligible, can only increase the burden of taxation on those, such as myself, who are receiving state pensions to which they contributed in full for many years, and who are still struggling to improve their position. A ‘benefit’ which can only be obtained by exposing oneself to ‘assessment’ by agents of the collective is an oppression, and my associates and I are quite oppressed enough already.

It is supposed to be a ‘burden’ on families to keep their relatives out of the clutches of the state? I considered it not a burden, but a necessity, to preserve my parents from such a fate.

When I was thrown out at the end of my ruined education, and found that my father’s health had been broken down by persecution so that he could not support me out of his salary as a headmaster, I thought, ‘You may think society has done its worst to you. But it can always find a way of doing something even worse.’ That has been shown true many times in the ensuing years. You may think that society has done its worst by letting your pension ‘wither on the vine’ and then means-testing it. But it can make things even worse by making it, in effect, more means-tested, so that you will be taxed even more heavily to pay for more ‘benefits’ to be made available to people of your age who are less resistant to oppression than you are yourself.

There is no ‘benefit’ without loss of self-determination (freedom). The non-means-tested state pension was the only remaining ‘benefit’ of which this was not true.

It is not a question of how bad the care homes, meals on wheels, etc. are in comparison with some equivalent that one might pay for directly; the principle of self-determination is all-important.

25 April 2011

Notes on property taxes

It appears that they have it in mind to tax property, which is bad for us as we still have no income from society for anything we do (or could do), and we still need to build up capital towards the institutional environment to which, once we get it, extra research departments can be added and the university press made increasingly productive.

The ‘mansion tax’ would only be the beginning of a tax on ever smaller properties, no doubt.

* * *

All you can say for the means-tested state pension is that it may just about cover the taxes we pay to the state. I.e. instead of paying all the taxes and making voluntary contributions to the state pension each year, we now make no contributions because everyone is fully paid up, and the reduced means-tested pensions received by me and Charles McCreery may just about cover, for the four of us, council tax, car tax, television licences, cost of garden refuse collections, cost of getting large rubbish taken away by the council, and cost of dumping unacceptable items of rubbish in the local rubbish dump (which is not very near). And perhaps there is a small net gain to us, so that we can say that, at long last, we are receiving a bit more each year from the state than we have to pay back to it.

If they had not introduced means-testing on the state pension some years after I had started to receive it, it might be adequate to cover capital gains tax (CGT) and ‘mansion tax’ on any houses we may own in the future. But probably not for long, as the taxes would keep increasing more than in line with (realistic) inflation, whereas the pension would not, even if not means-tested.

* * *

So those who are trying to remedy the bad position (non-position) in society imposed on them by their ruined ‘education’ have to be taxed (at any rate, they are taxed) to reduce their rate of progress towards an adequate life, and they have to transfer a part of the progress they have made to provide supposed ‘advantages’ to those who are not yet disadvantaged, many of whom will never be able to make any use of the sort of opportunities which we need and from which we have been excluded by the hostility to ability of modern society, as was expressed in our ‘educations’.

‘Education’ means, unfortunately, a very vulnerable period of one’s life when one needs to be acquiring qualifications which will establish one’s claim on the sort of position in society which one needs to have, but in which one has no control over the arrangements which are being imposed on one.

* * *

David Willetts said of the Baby Boomers that they had had such a good life that they should wish their pensions to be reduced so that coming generations could be provided with ‘educations’ as lavish as their own. I was a pre-Baby Boomer so this did not obviously apply to me, but I feel sure that plenty of them, including some with the highest IQs, and some whom I have known, were thrown out at the end of their ‘educations’ with no access to any career to which they could feel suited, and with only the sense that their relationship to their own internal sense of direction had been broken.

So, like me, it is likely that they would be more interested in using their pensions to work towards improving their own lives, rather than in sacrificing their pensions so as to make it possible for yet more people to be subjected to the ‘educational’ process.

We invite such people, whether or not they are prepared to complain of the bad effects of their ‘education’ on their prospects in life, to come and live near us in Cuddesdon, which is commutable from both London and Oxford, and cooperate in our plans to remedy the situation of individuals in an anti-individualistic society.

* * *

Building up capital may be the only method a person has of being able to be productive in a way to which they are suited, as it was with me. Not having any way of getting a salary, and being unable to draw the so-called social security, I put getting a roof over my head first, and at least the increases in value of the house which I bought in the Banbury Road were not taxed. This house had enough space for laboratories and offices, at least on a minimal scale, if I had been able to get funding to do research with which to assert my claim on a normal high-flying academic career. The salary which I could not get would have been taxed, and I would have been getting my pension contributions paid, but as it was I had to pay voluntary contributions myself out of non-existent income.

Eventually the house was worth much more than at the outset, although still not enough to set up even a minimal institutional environment within which academic work could be done.

So now people such as Philip Collins seem to think my accumulated capital should be taxed, i.e. I should have to find money to pay as tax out of my still non-existent salary, while I continue to try to expand my institutional environment to a point at which I can start on my adult academic career, already fifty-five years delayed.

I shall never stop trying to get all the things I should have had as part of a forty-year academic career in a professorial position as the Head of a department. That is, the salary, status, contacts, laboratory facilities, personal secretaries and other staff, and the dining hall facilities, etc.

I still need these things in order to have a productive and satisfactory life, and I see plenty of things in which to do progressive research for forty years.

01 April 2011

More rewards for the unforethoughtful

A new non-means-tested pension scheme, to start about 2015, is supposed to provide support greater than the current basic state pension and the current means-tested supplement combined, but it will not be available to existing pensioners.

A new flat-rate pension is expected to be worth at least £155 a week, it emerged last night. Ministers will next week press ahead with proposals for the most radical reform of the state pension system since its inception. The new system ... will provide a guaranteed level of support greater than the amount people currently get through the basic state pension and means-tested pension credit. Women, who often do not receive a full state pension as a result of taking time out of work to look after children, will be the biggest winners as a result of the flat-rate payment. But it will only be available to people reaching the state pension age from now, rather than existing pensioners. (Daily Mail, 1 April 2011.)

All existing pensioners must have fulfilled the requirement of making qualifying contributions every year without fail for a large number of years. They have demonstrated conscientiousness and forethought, which are correlated with high IQ. So they are certainly not the sort of people who should be rewarded (according to the modern ideology). This would be against the rule of modern society, which is that resources are to be taken away from sections of the population with above average IQs and bestowed upon a population with a lower average IQ.

The population which is to benefit from a non-means-tested flat-rate pension will, apparently, include many who fail to make the presently-required number of payments, including women who take time off work to have children and do not make voluntary payments to fill the gap. This seems to be a less highly selected population than those who have demonstrated conscientiousness, and could include individuals with a wide range of IQs.

All current pensioners receiving the full basic pension were so conscientious that they never missed out on a qualifying year. They will continue to receive only the basic pension, thus staying well below the poverty line, unless they are eligible for the means-tested supplement, and are prepared to submit themselves to the process of applying for it.

‘The question of ethics with regard to pension policy is one of the issues on which Oxford Forum could be producing fundamental critical analyses if it were provided with adequate funding. We appeal for such funding to enable us to write and publish on this and similar issues, which are currently only discussed in the context of pro-collectivist arguments.’ Charles McCreery, DPhil