Every so often over the past few years i have heard people ranting on about, when he was chancellor, our erstwhile PM "stole my pension" or words like it. What i want to know is what, EXACTLY did he do, and, more importantly what the effects are on us "peons" Which pension fund was raided.............private or State? How much is it likely to cost people etc?
The trouble is the public doesn't take the time to notice all of these bad decisions and the government gets away with a surprising amount of negligence.
The article also mentions the stock market which, if I remember, halved at one stage. This would have devastated most pension funds due to the amount of shares they held, which is why the shortfalls were so high a few years ago.
Now the markets have recovered ( though not completely), the deficits (if at all ) of most funds are much less then before, even without anybody (including employers) having to top them up.
Secondly, annuity rates have fallen heavily, meaning that the same fund now buys a much smaller pension then say 10 years ago - because of the longevity problem.
Neither of these factors are the government's fault.
Yep. That's exactly why many companies have been closing-down defined-benefit (eg final salary) schemes and setting up defined-contribution ones instead.
"Derek Geldard" wrote
Eh? Do you think that anyone has suggested that DC schemes are in trouble, due to longevity?
Certainly they have , in the link contained within the post I reasponded to.
Fred posted this link.
"Did Gordon Brown destroy our pensions? Britain's pensions have certainly suffered badly of late, and the temptation has been to pin the blame on the chancellor. The Tories have claimed that measures taken in the 1997 budget had the effect of taking £5bn a year out of pension funds.
But that figure is long out of date, and only represents a fraction of the size of total pension fund deficits.
DG> It is out of date, the last I heard it was £7bn.
The real cause of pension fund problems has been a combination of demographic factors - the tendency of people to live longer - and the ongoing weakness of the stock market. "
DG> We know all too well what's happened to the stock markets and annuity rate, but that's akin to a pickpocket excusing himself by saying saying the main cause of his victims discomfiture is the price of fish.
DG> I repeat the size of the fund at retirement date is not related to longevity.
At the end of the first paragraph it mentions "Pension Funds" which I take to be a unspecific collective term for all kinds of pension funds. DC funds are not expressly included and not expressly excluded either. No types of fund are expressly mentioned so the whole article is ambiguous.
Does that man we can't comment on it at all ? Even when there is obvious economy with actualité
No, they just said :
" The real cause of pension fund problems has been a combination of demographic factors - the tendency of people to live longer - and the ongoing weakness of the stock market. "
Without being more explicit and without mentioning Gordon Mc Shite-Features hands in the till.
My (tied) advisor told me Ca. 2,001 that GMSF was raiding the funds to the same extent as 100 Maxwells each year.
Yes, a fact that was not lost on me when I came to actually collect my pension which I started in 1978. No mention of poor annuity rates then or stock market crashes. Plenty of talk about "it's all completely safe it's all regulated by the government ... "
That was more than bad enough.
But this thread is about Gordon Mc Shite-Features hands in the till.
I could understand a "Windfall" tax of some description during the various de-regulation booms. But he kept on raiding the funds as they went down, down and further down. More or less the same applies to the pension providers, they kept on taking their 2.5% / annum as the the fund continued to go down.
Hey 2.5% / annum is quite a big proportion of the fund after 30 years.
"it's all completely safe it's all regulated by the government"
Doesn't the 2nd article from "John" explain quite a lot?
formatting link
The article from a TV report (above) is interesting - the article includes the following (sorry it is long), but it may help to clear up some of the confusion in this thread :
" The piece of evidence most often used to pin the blame on Gordon Brown is his decision to abolish a tax relief measure, called ACT, which allowed pension funds to claim back the tax paid on dividends from companies in which they owned shares. For the financial year 1999-2000, (the last year for which figures exist) this measure was taking an annual 5.4bn out of pension funds. This is the source used in the following claim which Osborne makes later on in the same speech: "His 5 billion tax raid on our pensions was a disaster for which pensioners will pay a heavy price for many years to come." This sum was partially offset by other tax reductions, but it did place a burden on pensions. And it's worth putting the size of the problem in context. The UK's hundred largest companies - which only represent a fraction of total pension liabilities - had a deficit of 36bn in their defined-benefit schemes in July this year, according to research by actuaries Clark Lane and Peacock. So 5bn a year would only account for a fraction of the country's total pensions deficit. The chancellor imposed this measure because, at the time, company pensions were in much better health. The stock market was high and rising, and many schemes were in credit. Since the dot-com bubble burst, those schemes which had invested their assets in the stock market saw their value plummet. This caused far more damage to their financial health than Gordon Brown ever could. And, as FactCheck pointed out last year, Gordon Brown wasn't the first chancellor to use this source of funding. Although Gordon Brown was the one who abolished ACT, one of his predecessors had already taken a chunk out of it: Tory Chancellor Norman Lamont cut the rate of ACT from 25 to 20 per cent in his 1993 budget. So, while Gordon Brown did change the tax regime in a way that disadvantaged pensions, the impact of his changes has been much exaggerated.
Verdict The nation's pensions are in a state - though not so bad as is sometimes imagined. And Gordon Brown's 1997 budget did take some money out of the pension system. But to suggest that he 'comprehensively, single-handedly destroyed' the nations pensions is an absurd exaggeration. It's particularly ironic that a Conservative chancellor also delivered a smaller but very similar blow to the pension system in 1993"
"Numpty" wrote in message news:00d80ec4$0$1606$ snipped-for-privacy@news.astraweb.com...
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