{"id":6964,"date":"2019-11-23T08:00:14","date_gmt":"2019-11-23T08:00:14","guid":{"rendered":"https:\/\/progressiveeconomyforum.com\/development\/?p=6964"},"modified":"2019-12-25T10:03:44","modified_gmt":"2019-12-25T10:03:44","slug":"writing-millions-out-of-our-pensions-system-will-hit-the-poorest-hardest","status":"publish","type":"post","link":"https:\/\/progressiveeconomyforum.com\/development\/blog\/writing-millions-out-of-our-pensions-system-will-hit-the-poorest-hardest\/","title":{"rendered":"Writing millions out of our pensions system will hit the poorest hardest"},"content":{"rendered":"\n

News has leaked that Boris Johnson is to write millions of people out of making national insurance contributions. This would be the result of increasing the minimum contribution threshold to the weekly equivalent of \u00a312,500 a year, which Sajid Javid<\/a> has stated that is an \u2018ambition\u2019 which would \u2018not necessarily\u2019 be reached by the end of a parliament.<\/p>\n\n\n\n

The gains to those making payments will be small. I am not\nsaying nearly \u00a3500 a year is insignificant when you\u2019re earning \u00a312,500 a year:\nit very clearly is. But let\u2019s be clear, it\u2019s not only they who will gain. This\nbenefit will, unless compensated for, go right up the income order to those who\nclearly have nothing to do with reducing a charge on those least well off in\nour society. It\u2019s certain that most gains will, then, go to those not in\ngreatest need. <\/p>\n\n\n\n

And what matters at least as much as any gain to those on\nthe lowest incomes is the state pension and other benefit consequences of this.\nThese are massive, and all at cost to those who Johnson says should gain from\nthis proposal.<\/p>\n\n\n\n

Our state pension entitlement is still based on the number\nof years of earned income a person has national insurance contribution made.\nTechnically this is not quite the same as making national insurance\ncontributions, but the limits used for appraisal are closely linked to the\nnational insurance system. And whilst I know there are compensatory benefits\nsuch as pension credit, but that\u2019s not the point. Such benefits come and go. So\nfar no one has been trying to get rid of the state old age pension, even if its\nvalue has been eroded. And now large numbers of people might have their\nentitlement substantially curtailed if, as I would expect, the pension\nentitlement threshold increase along with those for national insurance\ncontributions. How convenient is that for a government wishing to curtail\nbenefits and shrink what they think to be the welfare state?<\/p>\n\n\n\n

And this is not the only issue. It now seems that many\nentitlements are based on being able to prove work has been done. Even the\nright to stay in the UK can now be based on this. And now many people will not\nneed to be on payrolls, at least as far as their employers are concerned,\n and may well not have contribution records as a result and so will have\nno recourse to this evidence in the event of disputes on such issues. Where\ndoes that leave the vulnerable? More vulnerable is the very least of the\nanswers to be provided.<\/p>\n\n\n\n

I do not have a problem with reducing NIC on those on the\nlowest pay. But I mean reducing it and not eliminating it until such time as\ndependence on a payment record is also removed and proof that a person has\nworked as a measure of a contribution to society is eliminated.<\/p>\n\n\n\n

And I do have a problem with this being lauded when very\nlarge tracts of income \u2013 from investment sources \u2013 attract no national\ninsurance at all and so provide ample opportunities for tax avoidance for those\nrecategorising their earnings.<\/p>\n\n\n\n

There is a fundamental flaw in Johnson\u2019s plan and that is it\nis designed to attack those most vulnerable in our society. That\u2019s typical. It\nalso needs to be said. This plan stinks of privilege with an indifference to\nneed. That\u2019s why I oppose it as he\u2019s presented, and as he\u2019s likely to present\nit.<\/p>\n\n\n\n

Photo credit: Flickr\/George Grinsted<\/a>.<\/p>\n\n\n\n

…<\/p>\n","protected":false},"excerpt":{"rendered":"

Richard Murphy, PEF Council member, explains why raising the national insurance contributions threshold will write millions out of our pensions system.<\/p>\n","protected":false},"author":11,"featured_media":6971,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"nf_dc_page":"","_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"site-sidebar-layout":"default","site-content-layout":"default","ast-site-content-layout":"default","site-content-style":"default","site-sidebar-style":"default","ast-global-header-display":"","ast-banner-title-visibility":"","ast-main-header-display":"","ast-hfb-above-header-display":"","ast-hfb-below-header-display":"","ast-hfb-mobile-header-display":"","site-post-title":"","ast-breadcrumbs-content":"","ast-featured-img":"","footer-sml-layout":"","ast-disable-related-posts":"","theme-transparent-header-meta":"default","adv-header-id-meta":"","stick-header-meta":"","header-above-stick-meta":"","header-main-stick-meta":"","header-below-stick-meta":"","astra-migrate-meta-layouts":"default","ast-page-background-enabled":"default","ast-page-background-meta":{"desktop":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center 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