So as you can see from the title of this post, I think the UK needs to scrap the state pension in its current form, the problem is in modern day society we should not have anyone, especially the elderly being left without enough money where they have to choose between heating and eating. Plus when people get to an age where they can no longer care for themselves there should be care for them, without having to sell all their belongings.
The Problem – State Pension
As you may or may not know the basic state pension is around £119.30 per week, this being a basic guide to the amount, it can vary accordingly to income, earning and other factors. You can see that even this amount is not a lot to live on every month.
Not Everyone is Entitled to State Pension
It may come as a shock to you but the State Pension is not a right everyone in the UK has, as its linked to how much National Insurance you have paid, whilst in most employment or self employment you would normally have paid in enough to claim your pension, being 30 years of National Insurance Contributions (and not contracted out). There are some people who are either on certain benefits or low earning that will not actually qualify for a State Pension, meaning when they hit retirement age, they will have to claim Pension Credit to top up their income, along with these people workers who opted onto the lower rate of National Insurance will also lose their right to the full state pension.
As most of you will no doubt have seen, the UK has an aging population and not just aging but wealthy, due to many reasons housing booms, low cost housing, but that is not something I want to concentrate on, what I want to talk about is the fact that anyone who has worked and paid National Insurance Contributions for 30 years is entitled to a State Pension.
You may also not be aware that the State Pension is paid in the sum of millions of pounds every year to pensioners that don’t live in the UK, the so called ex-pats plus if they are over 70 they also get a winter fuel payment (even if they live in a hot climate)
So Whats Wrong With That?
The problem is alot of the people of retirement age have money, and don’t actually need the State Pension, plus if you are over 70 you also automatically get a Winter Fuel Payment. This means that millions of pounds every year are going to some elderly people that just don’t need the money, whilst others are starving, freezing or can’t afford proper care.
You may be thinking but if someone has worked their whole life and paid in, surely they deserve a pension. I think as the economy is in crisis and care homes are closing and an increasing amount of people are forced to use Food Banks or freeze in their own homes, its time we start acting a one nation and not a nation of individuals out for ourselves.
If we stopped paying out money to people who don’t need it, we will have more money available for those that do, and be able to fund care homes, without the need to raise council tax or ask people to sell off their belongings.
I think we should scrap the state pension in its current form along with Winter Fuel Payments, and replace it with a means (income) based system.
State Pension Replacement – Means Tested Benefit
When you hit retirement age you would not automatically get a state pension, however if you are in need and on a low income or no income, you could apply for a state pension. This pension would be a benefit solely based on income and savings.
Winter Fuel Payment – Means Tested Additional Payment
If you are unable to heat your home to a safe standard you can apply for a top up to your income in the form of a Winter Fuel Payment, the idea of scrapping the Winter Fuel Payment is supported by a lot of well off older people, including some famous names such as Sir John Hall (who every year donates his payment to help the more needed elderly)
This is only a small sample of this idea to Scrap The State Pension, but in doing so we would be able to do some or all of the following.
- Increase basic State Pension to those eligible to receive it.
- Remove the need for the Pension Credit benefit.
- Keep open care homes for those in need, these would be able to be better funded without people needed to sell off all their belongings to pay for their care.
- No need to increase council tax.