Proposed national insurance increase

[medsec222]

Will they increase it or won't they. Apparently it is still going ahead despite the fact that both Boris and Rishi seem to want to distance themselves from it. I was watching BBC news with Reeta Chakrabarti, and a guest on the programme was suggesting there are fairer ways of raising the money to clear the backlog in the NHS than a blanket across the board increase in national insurance.. She mentioned, for example, that people earning over £50,000 a year in effect only pay 2% whilst those on low incomes pay 12%. (I have to take her word for that). So far so good.

But in the next breath she quite shocked me when she suggested that pensioners should be paying the full 12% rise as they are often better off than low paid young people. Indeed, some pensioners are undoubtedly better off than others, but the majority of pensioners are now facing increases in food prices, fuel, heating, council tax etc. while they are existing on a fixed income - plus the fact that the triple lock which was designed to help pensioners has been suspended.

I agree that there are better ways to fund the NHS backlog, but targeting pensioners is not one of them.

[Kaz]

I agree. Most unfair. That NI rate sounds strange, I can't see that being correct

[Workingman]

Ah yes, the sweeping statement that 'pensioners' are often better off than low paid young people. Some are. Those who were high earners able to buy a decent private pension pot. Many millions, those on the average income or lower, the majority, did not have that option. They worked to survive and had just a bit over for things like holidays. They are now on £179.60 per week if they are on the full pension or £139 on the old scheme. They do not pay NI.

However, there are quite a few pensioners who have a small pension that takes them over the tax allowance and they do pay, no matter how much over the allowance they are. Taking the full 12% off all of them is iniquitous. What is needed for pensioners is a sliding scale depending upon how much over they get, let's say 2% for the first £1000, 3% for the next £500, then 4%, 5% and so on up to 12%.

Anybody over 20 on NMW in full-time employment gets £309.40 per week. There are some benefits for those in part-time work over 16 hours per week to give them a living wage.

I have no problem about some pensioners paying something, but I hate it when these experts (on high salaries) make these throw-away remarks.

[Suff]

NI has bands. The lower bands are at the full rate of 12% and then it drops after £967 a week to 2%.

The only way I can see someone claiming upper management workers only pay a few % in NI is that they take the full wage and divide it by the payment. Which is incorrect.

Everyone in the same group pays the Same NI up to £967 a week. Nobody pays less.

Of course contractors forced into IR35 pay 12% like everyone else, 2% like everyone else earning over £967 a week then they get stuffed 13.8% On Top, for employers NI, for every £ they make. Therefore paying 25.8% for up to £967 a week and 15.8% for every £ they earn over £967 a week.

For which they get the same pension as everyone else, no holidays and they get the wonderful joy of paying their own sick pay.

My sympathy is limited, they've already done a Massive NI cash grab. Now everyone else is getting to share the joy. Excellent.

[Workingman]

Suff, with all due respect this is not about IR35, which you obviously have a bee in your bonnet about, because that is outside the scope of what ordinary PAYE workers and pensioners pay in NI.

I watched the Chakrabati interview and the woman did say that pensioners are often better off than low paid young people. That is a downright lie and she was not challenged about it by Chakrabarti - that infuriated me. That's what this is about.

One thing I did get wrong in my annoyance was that pensioners pay NI, I was thinking about income tax but I was so inflamed I mixed up the two. It is actually 20% on every £ over their pitiful allowance, Apologies.

[cromwell]

I don't like it either, who would?
But the government shut down large sectors of the economy during the pandemic "following the science". They paid 80% of laid of people's wages. They borrowed £400 billion plus.
You can't do all that and carry on as normal afterwards. Someone is going to have to pay for it.
Unfortunately due to years and years of every government we had ignoring energy security, the pandemic has coincided with Putin turning the gas tap off to Europe resulting in a massive rise in the market price of the gas that is available.
So we are going to get taxed more and pay more for our energy (and food).

[Suff]

Really? IR35 is an attack on more than half a million workers in the UK, workers who take all the risk, pay their own sick pay, run their own companies and pay insurance to reduce the risk.

You might think this is a special case for IT contractors but you would be wrong. Your delivery drivers were forced into companies and self employed hand carwash too. It has been an insidious attack on the self employed to promulgate this NI attack.

Hence I'm seriously pissed off with it.

If you saw the increasingly desperate IT security jobs on the market, rates going up, professionals like me saying "it's no at any price", you would realise how big a problem this is.

Never mind that the banks decided to royally screw us by refusing to correctly categorise the jobs, putting all the risk and cost on us.

So there you are, you can't get deliveries and your banks are running increasing risk of a ransom ware attack that will lock your money up. Why?

A nasty, insidious, NI rip off which the majority of the perm workers think is "a bee in your bonnet". If your aggregate costs on your pay went from circa 30% to 62% you'd have a bee in your bonnet too.

I am totally in agreement with the tax though and I feel for everyone in that position.

[Suff]

I don't like it either, who would?
But the government shut down large sectors of the economy during the pandemic "following the science". They paid 80% of laid of people's wages. They borrowed £400 billion plus.
You can't do all that and carry on as normal afterwards. Someone is going to have to pay for it.

I said as much at the beginning of the furlough.

To rub salt in the wound, all those IR35 shafted were not given furlough. Oh no, they were offered a 10 year loan with one year interest free period followed by a "super low" 2.5% repayment over the next 10 years. We'll over the interest rates at the time.

And no, I'm not happy that everyone else gets to share in the pain, but that is what is going to happen.

At least they didn't do it on the basic tax rate, that would really have screwed the struggling.

[cruiser2]

I get the StatePensionand some Graduated pension.
I also get aprivate pension from my last employer. This means |have to pay income tax. I earn too much to get any benefits.
So with the inreases in the price of food, energy, council tax I will have to dig into my savings.
I am saving a little on food as I am no longer buying bread. It has sugar in it and I am trying to keep my Bllod/sugar
levels down..
Interesting article in DM on how NHS could save money.
Also why is CEO of HS2 paid over £600,000. How does this compare with other similar contract and who decided this fogure?

[Workingman]

Suff, I am getting good at this not explaining myself.....

I was not saying that IR35 is not an issue, I was trying to say that it is not the issue regarding what the well paid exec said about pensioners being well off or better off.

State pensioners do not get enough to exceed the income tax personal allowance threshold, they fall short by £3,200. Another group, such as Cruiser and myself, get a little over the tax allowance and for that we pay 20% tax and no benefits. As I said in my OP I am not against pensioners chipping in, those of us that can need to, What I am against is people on fat pay packets making out that pensioners are somehow "well off" just so they can score Brownie points in their echo chambers.

The other thing they do is make out that the State pension is a benefit. No it bloody well isn't. We paid week in, week out, to get the pension, just as those with private pensions do - are private pensions a benefit?. If I could turn back time and then had the opportunity I would have opted out of the State pension and gone private. Had I paid in the equivalent of my NI contributions, penny for penny, for 45 years I would be a lot better off than I am now.