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Rajab Al Zarahni
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Posts posted by Rajab Al Zarahni
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6 hours ago, sandyf said:
It is not as straightforward as that. This is the top level legislation that refers to various other regulations.
Persons not ordinarily resident in Great Britain
3. Regulation 5 of the Social Security Benefit (Persons Abroad) Regulations 1975(b) (application of disqualification in respect of up-rating of benefit) and regulation 21 of the State Pension Regulations 2015(c) (entitlement to state pension for overseas residents) shall apply to any additional benefit payable by virtue of the Up-rating Order and to any up-rating increase as defined in section 22(1) of the Pensions Act 2014 respectively.
http://www.legislation.gov.uk/uksi/2017/349/pdfs/uksi_20170349_en.pdfThis regulation quite clearly stops all overseas residents from up-rating but we know for a fact that some are, so there must be some other regulation that over rules the text below. We also know for a fact that the DWP refers to a reciprocal agreement so it seem fairly clear that those that do receive the up-rating do so under an agreement with the country concerned. Each regulation seems to refer to some other regulation and I gave up trying to find the text that refers to these agreements.
Entitlement to state pension for overseas residents
(5) In all other cases, a person is not entitled to up-rating increases where, immediately before the up-rating increase comes into force, they were—(a) entitled to a state pension under Part 1 of the 2014 Act; and
(b) an overseas resident.
https://www.legislation.gov.uk/ukdsi/2016/9780111141151I don't comprehend the essence of the point you are seeking to make.
I agree that there are regulations and legislative provisions preventing the up-rating of pensions in certain countries but not others. These have been made by the UK government and its predecessors. Pointedly, the same UK government is the only sovereign power that can change such regulations and legislative provisions.
The essence of my point is that changes to these up-rating provisions are not contingent upon any reciprocity agreements or treaty obligations with any foreign power.
You stated: " We also know for a fact that the DWP refers to a reciprocal agreement so it seem fairly clear that those that do receive the up-rating do so under an agreement with the country concerned"
Do you really believe that the Thai government, for example, has forbidden the UK government from updating the state pensions of its citizens residing in Thailand ?
We have a number of bespoke reciprocal agreements with a variety of different countries. The UK government has elected to use the fact or absence of an extant reciprocal SS agreement as a marker to divide countries into those where it will pay pension up-rating and those where it will not. It is not the content of each of these agreements which determines this but simply the existence of such an agreement.
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1 hour ago, evadgib said:Guy OppermanThe Parliamentary Under-Secretary of State for Work and Pensions
The UK State Pension will remain payable worldwide following our departure from the EU. We have now reached agreement with the EU to maintain State Pension up-rating for those covered by the Withdrawal Agreement, subject to reciprocity.
So to summarise this statement of utter drivel, the UK will guarantee to uprate the state pensions of its nationals who remain in the EU, only if the EU guarantee to do likewise for their nationals who remain in the UK !!!
Such a nonsensical reply serves to demonstrate that even those at ministerial level have not the slightest understanding of what they are talking about.
The power to uprate the state pension for those residing abroad does not reside with and is not contingent upon the approval of the EU, the Thai government, or any other foreign government or agency. The power and the willingness to uprate pensions abroad rests entirely with the UK government.
The EU will not dispatch its gun boats into the north sea if we decide to uprate pensions for our citizens who remain in their area.
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34 minutes ago, billd766 said:I found this little gem on another website.
https://researchbriefings.parliament.uk/ResearchBriefing/Summary/SN01457
I extracted the following quote from the above document in order to dispel any belief in the argument that you would need a Reciprocal Social Security Agreement in order to unfreeze the pension increases:
A DSS Memorandum to the Social Security Committee in 1996 explained the role of reciprocal social security agreements:
16. Reciprocal social security agreements are not entered into solely with a view to paying annual uprating increases to UK pensioners living abroad. They are not strictly necessary for that purpose as uprating can be achieved through UK domestic legislation…
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9 minutes ago, strikingsunset said:
500m GBP to resolve this - it’s peanuts in the scheme of things
Sent from my iPhone using Thaivisa ConnectThe total spending of the UK government in the current fiscal year is anticipated to be £817.5 billion.
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1 hour ago, sandyf said:
As far as I am aware all proper company pension schemes were automatically contracted out, the employee had no say in the matter. The water gets muddied where companies arranged a group pension scheme for employees which were in fact personal schemes rather than proper company schemes.
Anyone who has never contacted out would have the returns from the state additional pension schemes showing on their pension statement, which are.
Graduated Retirement Benefit - 1961 - 1975 ( No contracting out on this)
SERPS - 1978 - 1997 (This is when contracting out for company schemes started.)
SERPS2 - 1997 - 2002
Second State Pension - 2002 - 2016 (Additional pension was discontinued April 2016)
There were a small number of company pension schemes that were not contracted out. For these, the member paid the full NI rate contributing in full to the State Second pension as well as the company pension.
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30 minutes ago, lungbing said:
I think that refers to pensioners that are still working should pay NI, not all pensioners.
That's also my understanding
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3 hours ago, mommysboy said:My fear is that a government will decide to tax the state pension for expats, arguing that as we are no longer resident for tax purposes we are not entitled to the personal tax allowance.
I don't know how realistic this fear is! Can anyone comment?
If you regularly scan the media for interesting pension news items you will know that it has been suggested. The idea doesn't seem to have much popular support. The last time I read a news item about it the idea was to give everyone the currently frozen increases but take away the personal allowance. Another suggestion which is occasionally mentioned is to make OAP's pay NI contributions. Personally I don't see either idea becoming a party manifesto pledge as it would upset too many people.
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3 hours ago, steve187 said:
could you link that info or give a breakdown of the amounts, and is that under the old system
Yes it's under the old system and as at 2018 and comprises £125.95 Basic State Pension and £172.28 Additional pension( SERPS, SP2, Graduated Pension ).
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19 hours ago, Rajab Al Zarahni said:
What about those who made the maximum contribution to SERPS and contributed for a lifetime of work up to retirement. They would certainly get a pension beyond the personal allowance of £11800 ?
Just for information.
Having looked further into this it appears that potentially someone with a full basic pension who had contributed the maximum SERPS contributions would get a pension of £15507.96/year ( £298.23 weekly).
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2 hours ago, champers said:
The maximum state pension payable for a single man is £164.35 per week. That is less than £11800 p.a.
That must be new state pension. The figure could be much higher under the old system which would include basic pension, SERPS, SP2, and Graduated Pension. Furthermore, the figure will also be higher for those who have deferred and elected to take income rather than a lump sum.
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10 minutes ago, denby45 said:
Paying tax on private pension is not relevant to the argument. Also I do know there is no facility for the government to tax your state pension at source. It is always paid gross and is supposed to be reconciled if you go over your personal allowance. I know many pensioners but I don't know any that get enough state pension to pay tax on it. The reason I asked about the numbers of pensioners is because I cannot find any figures online.
Den
Paying tax on private pensions is relevant because the tax code would be increased to reflect the additional income from the state pension.
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3 minutes ago, champers said:
Anyone on only a state pension will not reach the threshold that is their tax allowance (£11500 ?). Must be tough going on state pension alone.
What about those who made the maximum contribution to SERPS and contributed for a lifetime of work up to retirement. They would certainly get a pension beyond the personal allowance of £11800 ?
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Just now, denby45 said:How many pensioners are paying tax on their state pension? Do you have the figures? Just curious.
Thanks
Den
I don't have any figures but those paying tax on pension income will generally be those with both state pension and private pension income. Any income liability would be taken from the private pension at source.
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1 hour ago, DILLIGAD said:
Exactly, but why is it not mentioned by this party who are honorably fighting the fight on behalf of the frozen pension getters.The UK government have mired this issue in a number of clever obfuscations. The need to have a Social Security Agreement is just one of them.
They no longer use this excuse as everyone knows its rubbish. The latest defence is the one about expats not contributing to the tax burden. This also falls apart as an argument with many expats paying income tax on their pensions at source and pensioners in, for example the Philippines, getting the increase that are denied to those in Thailand.
Consider for a moment why the treatment of the Windrush generation has raised holy hell in Parliament. Diane Abbott and David Lammy have threatened hell, death and public hangings for the heinous crime of racism about the unjust way they have been treated. Their unique characteristic however is that they are black.
If they were indigenous, white, Anglo-Saxon and protestant they would just be told "tough luck, stop making a fuss about nothing" !
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3 hours ago, Oxx said:Why has it got anything to do with treaties at all? I've never understood the logic.
There is no logic. Its just an excuse to throw you of the scent. Think about it, why can't the UK pay what it wants to whoever it wants ? Is the Thai government going to break off diplomatic relations and declare war because the UK has paid increases to its pensioners ? The fact of a treaty is not a requirement, its just a device to get people thinking that there is a logical reason why it can't be done.
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28 minutes ago, mommysboy said:You make a compelling argument. I'm not sure I would make such a dramatic comparison.
The headscratcher for me is how this situation has been allowed to go on for so long; it's a total contradiction in the way the scheme runs. The recent overhaul was about fairness for all, and simplicity.
The only bit of reasoning was that expats were no longer contributing to UK economy. Yet this is a weak argument since the pension is always based on qualifying contributions - that's as clear as day.
More intriguing to me is the process of reasoning that brought about the freezing of pensions in the first place. I have learned through experience never to underestimate the huge numbers of people who are motivated by envy and jealousy. The perception of expats living in Thailand by many in the corridors of power is of retired men with no responsibilities living cheaply but contentedly in a palm tree paradise with a beautiful supermodel girlfriend. Remember that many people who administer the law go to work in the cold and the rain on a congested underground a travel two hours a day just to come and go from the daily grind.
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58 minutes ago, mommysboy said:It's grossly unfair (and so too is the 2 tier system) but clearly the government has exploited a loophole regarding increments. It's been looked at and isn't unlawful, so any legal challenge is bound to fail.
It would have been better to be less confrontational. That way, there may have been more sympathy at a higher level. The government has already said it is illogical and gave the reason that is not affordable to consider back payments- this could have been taken as a clue on how to proceed.
The present stance is just playing in to their hands imo.
The campaign to unfreeze pensions will certainly not be won through legal challenge, however, raising a claim against the government is a symbolic action which will attract publicity for the political campaign. Slavery was lawful in the UK until 1834. It wasn't the government who were unhappy with it. It took a protracted and determined political campaign to change the law.
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4 minutes ago, mbamber said:Invested in the Merchant Navy Pension Fund and thought if I retired early I would have a reasonable pension but low & behold it was about 1/3 MORE than I expected.
According to new data I will get the state pension at 66 I doubt I will get anything the only pension right I have at present is to pay Tax on it.
The great thing about being a pessimist is that you will never be disappointed.
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5 minutes ago, Oxx said:
So, I was right. There is no investment whatsoever in gilts.
Gilts are simply held short term as an alternative to holding cash, which makes sense since the returns are fractionally better.
Technically, I believe you are right as at today . From my understanding the NIF did originally have gilt holdings then in 1981, HM Treasury arranged to create "NILO" stocks specifically to meet CRND's investment needs when there was no other way to do so. HM Treasury issues non-marketable NILO (named after the former National Investment and Loans Office) stocks on the same terms and conditions as the marketable parent gilt issue(s) to which they relate. All transactions in NILO stocks were dealt with on the basis of the current market price of the parent gilts. NILO stock that were no longer required by CRND were purchased and cancelled by the Treasury.
In January 2007 the NIF sold off all its gilt holdings, presumably as NILO stocks and created the debt Management Account Deposit Facility.
It still has an investment account facility and still receives modest increases but I can find no information on investments. I think the probability is that the government top it up at the level of bank base rate.
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14 minutes ago, mommysboy said:
Yes, this is very confusing. Treasury grants were made. You would have thought some investments would have been offloaded. Maybe the fund account is more notional or actual funds not easily liquidated due to obligations.
There was definitely a shortfall though. Part of this is the economic malaise of the country, but it is also the demographic issue beginning to show.
It just seems obvious to me that the current pension needs to be cut, contributions raised, and the pension age upped. But these things are usually phased in over years and even decades.
There are a number of other things that have been put forward including the disturbing suggestion of levying NI contributions on people over pension age.
II think it was David Cameron who promised us " a bonfire of the QUANGO'S" This in fact never happened but it is clear that the economy of the country is sinking under the weight of its own administration. This would be my starting point. Every year we have initiatives to streamline services or make them more efficient but rarely ,if ever, do we here of a service being abolished. Why for example do we meed ACAS when we have had no significant industrial disputes warranting its intervention for at least 20 years ?
If people are living longer and we need to spend more money on pensions, that we don't have, then stop spending the money on promoting ballet dancing initiatives in Ethiopia !
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2 minutes ago, billzant said:Their use of the word benefit for something that we are entitled to because we have paid for it is a tactic. It is an attempt to move the "line". Do we accept the notion that it is a benefit when we have paid for it?
You are absolutely right. This argument is equally true of the use of the word "fund". Once this idea becomes embedded in the minds of people you can indulge in the subtle obfuscation that pensions have to be frozen or reduced because there is not enough money in the "fund".
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1 minute ago, sandyf said:
Yes but how much is left. In 2009 we know there was a surplus of around £59 billion but 12.8% of income tax was used in the 2014/15 tax year to make up the shortfall between available NI and the state pension liability.
As at the 29.03.2018 the investment account had a balance of: £26,527,000,000.
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14 minutes ago, Oxx said:
Do you have a single shred of evidence to confirm what you assert? I'm guessing "no". There is no "investment" in gilts. Zip, nada, zilch.
The only person mythologising here is you.
Here is the answer for those who are interested in the dreary detail:
National Insurance Fund Investment Account
This Fund, which dates in its present form from 1975, is by far the largest of those managed by CRND. The Social Security Acts of 1973 and 1975 established a new Scheme of social security contributions and benefits, replacing the National Insurance Acts and assimilating the Industrial Injuries Acts. Under the 1973 Act, two separate funds previously comprising the National Insurance (Reserve) and the Industrial Injuries Funds were wound up and their assets transferred to the National Insurance Fund (NIF) on 1 April 1975.
The NIF is intended to be the 'current account' of the National Insurance Scheme, holding sufficient funds to even out fluctuations over time in the movement of contributions and benefits and to provide a source of finance to meet exceptional demands, for example in times of high unemployment or a sickness epidemic. By virtue of section 161(3) of the Social Security Administration Act 1992, HM Revenue and Customs (HMRC) transfers money to the Investment Account on days when it has a net inflow of cash and draws from the Investment Account on days when payments exceed receipts.
Following a review by HMRC, HM Treasury and CRND, a change to the NIF investment strategy was approved in December 2006. This change has resulted in lower administrative charges to the NIF. The change was effected in January 2007, when all the Investment Account’s gilt holdings were sold and the proceeds placed into the Debt Management Account Deposit Facility. Since then, the earnings of the Investment Account have been much more closely aligned to the Official Bank of England Rate (Base Rate).
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UK pensions
in Home Country Forum
Posted
A DSS Memorandum to the Social Security Committee in 1996 explained the role of reciprocal social security agreements:
16. Reciprocal social security agreements are not entered into solely with a view to paying annual up-rating increases to UK pensioners living abroad. They are not strictly necessary for that purpose as up-rating can be achieved through UK domestic legislation…
The following has been extracted from the House of Commons Library: Briefing paper: CBP-01497: Frozen Pensions Overseas: 07.08.2018: Item: 1:2 Reciprocal Agreements:
In 2013, the Government said it had received requests for reciprocal agreements or representations on up-rating from a number of countries: In recent times, there have been requests from Columbia (2008), Mongolia (2007), Thailand (2010), Uruguay (2011) and Brazil (2011). In recent months the Government has received representations from both Australia and Canada in which they raised the issue of up-rating the UK State Pension. Those two countries represent by far the largest proportion of recipients in countries where the UK state pension is not index-linked and indexation would present a considerable cost to the Exchequer, particularly considering the wide disparity in the number of pensioners involved. The Government has therefore informed the Australian and Canadian governments that it will not be opening formal discussions on this policy.
Please note that in the case of Thailand it is not the Thai government that won't agree, rather it is the UK government who are failing to accede to a reasonable request for up-rating. Hopefully this now dispels the ridiculous notion that the UK government cannot up-rate because of the failure of others to cooperate.