UK Politics General Discussion

[BarryZola]

The point is, we need to cut the deficit somehow and that means savings or generating more taxes from somewhere. The OBR, the government or whoever change their minds about how big our black hole is every few weeks it seems. The fact is we're massively in a hole. Where is the money going to come from to run the country without getting into more of a hole? I shall look forward to the budget to see how they're going to raise money.

 

[pluk]

The OBR, the government or whoever change their minds about how big our black hole is every few weeks it seems.

It is all forward facing, and that is the very nature of forecasts, it will always be so. I also got wet last night when the weatherman said it wouldn't rain until this morning.

Not to react to a change in a forecast would, of course, be dumb. If the forecast had changed sooner yesterday I'd have taken a brolly with me.

 

[Hid]

No, it was another thing that they clearly wanted to do as they'd been softening the public up for a massive U-turn for weeks (not testing the water). This is another big money making/saving scheme that they've chickened out on due to pressure from back-benchers (the benefits savings was the first one). I'll say it again, there's literally no point to Starmer and Reeves. They're just front-people who do what they're told. There is no point to them at all. Extending that, there was no point in Labour getting into power because the party is clearly too split in its beliefs to get anything genuinely worthwhile done. All they've managed to do is increase expenditure as far as I can see.

They did not announce they were raising income tax so it was not a U Turn as it was only speculation

 

[GooseOnTheLoose]

They did not announce they were raising income tax so it was not a U Turn as it was only speculation

They just organised an unprecedented 8am public broadcast on national television where Rachel Reeves stated that "easy answers" to fix the economy would be "irresponsible" and refused to rule out rises to income tax, VAT, or National Insurance, suggesting that sticking to all manifesto commitments could require "deep cuts" to public investment.

The speculation which followed was entirely of their own creation. It wasn't a U turn, it was a full 360° O turn. They are back to their original position after briefing out a different one.

 

[rob666]

Just to make a massive point here...

Have we all started believing what we read in the great british press all of a sudden???

The budget is still a couple of weeks away.

Downing Street is desperate to turn the focus away from its own internal struggles.

Whatever else is being reported, they are the only facts.

Nothing is yet decided, numbers are still being crunched.


And police crime commissioners, I had need to contact mine once...absolutely useless, and gave me factually incorrect information...three weeks late.

Bye fella.

 

[BarryZola]

They did not announce they were raising income tax so it was not a U Turn as it was only speculation

She all but confirmed it in an interview only in the last couple of days. In another interview she was talking about how she's being brave making the decision that other chancellors hadn't had the guts to do. She may not have literally said the exact words that she was definitely going to do it but it was clear that this was her plan.

 

[BarryZola]

It is all forward facing, and that is the very nature of forecasts, it will always be so. I also got wet last night when the weatherman said it wouldn't rain until this morning.

Not to react to a change in a forecast would, of course, be dumb. If the forecast had changed sooner yesterday I'd have taken a brolly with me.

In my opinion the talk of the OBR forecast that suddenly came to light is a convenient excuse for another U-turn caused by pressure from her back-benchers. I predict that they'll be talking about a bigger black hole in only a month or two. We shall see.

 

[Smiley]

I wonder if the 2 child benefit cap will also now be a massive O-turn, given it will cost £3.5bn (I think).

Or perhaps it's more palatable just to drop the self-imposed rule of not borrowing for day-to-day, and instead pretend it doesn't matter as AI will make us all super-productive next year :-D Better she does it now rather than nearer to an election...

 

[BarryZola]

The latest rumblings are that instead of raising income taxes by a couple of pence, they're going to freeze the threshold on where people start paying tax (which is currently £12,570).

Isn't this going to get more of the poorest in society caught paying tax instead of putting more of a burden on the richest?

I thought they wanted the wealthy to start paying more of a share (than they already are)?

By the way, I heard the most brilliant suggestion by someone on the radio last night who used to work in the bond market. At the last count it's reckoned that around £4.2 trillion is held in private pensions in the uk in total. The suggestion was that we just tax private pensions for everyone by 1% for as many years as it takes to sort our finances out. That would raise £42 billion each year at the swipe of a pen. No need then for all of the other 50 stupid taxes that she's probably just going to put on everything and upset everyone. I know I wouldn't mind a 1% tax on my pension for several years until we sort ourselves out. It's amazing that you never hear of them floating things like this. I think it's an absolutely amazing idea.

 

[Smiley]

The latest rumblings are that instead of raising income taxes by a couple of pence, they're going to freeze the threshold on where people start paying tax (which is currently £12,570).

They're already frozen until 2028 (all tax bands), so people also get dragged into the upper tax brackets earlier. The rumour is that they won't be un-frozen in 2028 as was originally planned. As for taxing pensions, income from pensions are taxed in the same way as income from work. Why taxing people for being sensible and saving for their retirement would be an odd choice...?

 

[BarryZola]

Thanks for clarifying that about the tax threshold thing, I hadn't realized that. But yeah, on the pensions thing, not many people would massively miss 1% on their pension pots as if 1% is going to be a massive amount of money from people's pots then they'll have ginormous amounts in there anyway. They're already tax efficient and usually topped up massively by employers anyway. If they don't get you on the pension they'll get you somewhere else anyway. Labour have said that those with the broadest shoulders should carry the biggest burden so this would be a good way of doing that also. If you had a million quid in a pension you'd only be paying £10,000. Not really the end of the world. If you did this you could probably get rid of inheritance tax completely and stuff like that.

 

[pluk]

Compound interest does not agree with 1% of your pension pot being taken each year being something you wouldn’t massively miss. It'd be hugely impactive to your pensions final value and the amount you'd be living off in retirement.

 

[Benzin]

Compound interest does not agree with 1% of your pension pot being taken each year being something you wouldn’t massively miss. It'd be hugely impactive to your pensions final value and the amount you'd be living off in retirement.

Assuming that some of us ever get to retire or the world hasn't blown up by then.

 

[BarryZola]

Compound interest does not agree with 1% of your pension pot being taken each year being something you wouldn’t massively miss. It'd be hugely impactive to your pensions final value and the amount you'd be living off in retirement.

In the past 20 years the FTSE 100 has averaged around 6% a year in returns. The S&P500 has returned around 10% (if anyone is tuned in enough to change where their pension pot is invested - if they have a choice). Your pension is still going to grow. It'll mainly grow due to your actual contributions anyway, not the interest. And don't forget that your employer has probably been at least matching your contributions anyway so half of it is free money, and the fact that it's protected from tax when it goes in in the first place (I'm pretty sure).

Has anyone got any better ideas that will actually make an actual difference in the next couple of years? Something that is actually achievable? There's no way that you're suddenly going to get all of the workshy people suddenly off their ar**s and looking for work. Labour have refused to sort out the benefits situation. They're obviously not going after the banks and other massive companies for windfall taxes or whatever (let's be honest, business runs the government now).

So what, things like 1% tax on a pension for a few years until we get ourselves into a better place financially are so offensive that you're happy to just see the status quo? Because that's pretty much what you're getting.

Or, you could have one simple additional tax that's easy for everyone to understand on your pension for several years which relaxes a load of other measures that would be brought in otherwise. Honestly, I don't know what people 'realistically' want.