Equality and Diversity Laws, should these be scrapped??

David49

Contentious, yes, it's meant to set everyone thinking. If pension were withdrawn from the top 20% of wealth it would yield savings of £36 billion if we are serious about improving equality changes like this are going to be needed.

Anyone with assets over £500k is well able to support themselves, the UK has plenty of wealth if we don't start using it efficiently we are going to sink further and the equality gap is going to get wider.

This was your original suggestion. Now I realise you don't actually mean the top 20% of general population wealth which the ONS calculated as £600k for period 2020 to March 2022- now would be higher.

Your £500k assets per household threshold below which people should not be eligible for state pension therefore is a personal view and does not represent the top 20% of anything. A couple could reside in a £400k+ house in south east, just finished paying off their mortgage, have little savings, a modest car, but no personal or job pension. Their family and friends ie their support network, lives in the same area. Your proposal is that as they both retire at state pension age they should not qualify for or receive the state pension.

I now understand- thank you- it was the top 20% bit that I found confusing.

Lemonjam

"*ONS data- April 2020 to March 2022 calculated top 10%, top 20% and Median household wealth in the UK:
1) Top 20% threshold required a net worth of roughly £600,00 per household.
2) Top 10% threshold required £1.2 million or more
3) Median wealth, ie the average adult's net worth hovered around £400,000 household wealth in that period*"

Yes, that refers to the population in general not pensioners, because pensions are being drawn down the average pensioner wealth is less.

You can choose 20% or 10% of pensioners or anything in between, taper it as you choose, the principle is that we should not give benefits to those that don't need them.

However because the pensioner vote is vital to any party which is why they all have committed to retaining the triple lock on pensions.

David49

"The problem therefore David49 is your provocative suggestion that a household with £500k wealth in 2026 constitutes the top 20% of wealth holders win the UK- it doesn't. It did not even meet the top 20% threshold 4 to 5 years ago and is more likely hovering around the average wealth in 2026."

Pension paid is fixed per person 20% of pension fund cannot be the average wealth, it's very difficult to pin down the point that a 20% (or 10%wealth) threshold would apply threshold would apply, most of the statistics refer to income.
Clearly a lot of homeowners have properties valued at £200k or less and little private pension, others have houses worth £1m + plus and a private pension pot of £1m as well, where does the 20% threshold lie?

The principle that we should not give benefits to those that dont need them applies just as much the WFA, we know that wealthy families have enormous advantages over a poor family, if we are to have wealth tax it needs to apply to a much larger group than the ultra rich.
Obviously most of us would like any tax to apply to someone else, we all want as little tax and as many benefits as we can.

*ONS data- April 2020 to March 2022 calculated top 10%, top 20% and Median household wealth in the UK:
1) Top 20% threshold required a net worth of roughly £600,00 per household.
2) Top 10% threshold required £1.2 million or more
3) Median wealth, ie the average adult's net worth hovered around £400,000 household wealth in that period*

The ONS used data from the Wealth and Assets Survey WAS to calculate household wealth- methodology on ONS website. I understood that you suggested anyone with household wealth of £500,000 or more in 2026 constitutes the top 20% of wealth holders in the UK? If I misunderstood you please feel free to put me straight. As, allowing for inflation, £500k household didn't even constitute top 20% of wealth in 2020 to 2022 never mind about 2026= and is closer to median household wealth after adjustment for inflation.

What methodology/measure are you using to calculate household wealth in your £500,000 threshold amount? How does that differ from the ONS methodology? What measure did you use to support your suggestion that household wealth of £500k in 2026 constitutes the top 20% of UK wealth holders?

I understand and agree with your principle of a wealth tax and the principle we shouldn't give benefits to those that do not need them. However it's your suggestion that anyone with £500k household wealth in 2026, ie more or less median wealth should not be eligible for state pension. That somewhat shifts your position towards advocating state pension should only be paid to those with less than average household wealth

.

Thanks Graphite. TBH, a few pounds here or there doesn't alter the point though.

David, much of what you say is pretty much what I said. Ordinary people muddle along, trying to make their lives better for themselves and their children, just to find that they'd have been just as well off if they hadn't.

I agree that property inflation is an important factor, but assuming people don't 'emigrate' to cheaper areas (something that happens a lot where I live - the once small town has a large number of residents who have retired here on the proceeds of a house sale that released a lot of equity) it's not the only one.

A final salary pension makes a huge difference, for instance. Obviously not all of them are as 'gold plated' as the media would have us believe, but even the people on the lower end of them would have been worse off without them. They don't come free though - people pay in a chunk of their salary, and are often on lower wages in the roles that have them.

Inheritance is another thing that makes a difference. There will be others, too - it's not all about property inflation.

Also, savings outside of pensions - rainy day funds, if you like - can debar people from 'targeted' benefits of various types. The problem is not that they are given to those with no money, but that they are not given to those with a little put by, even if the people concerned earned the same salary and there were no obstacles such as disability to make a difference. Someone not getting the help their neighbour gets may soon find that they have used up the money they'd put by and are in the same position as the man next door, so they may as well not have saved it.

I'm not saying everyone thinks like that, or whether it's reasonable or not - just that I think many people do, and they are disillusioned. We (as a country) rely on a dependable workforce to do the essential things that keep us ticking along. If those people give up, it will be worse for everyone, so (IMO) there has to be an incentive to it. Even if they know they'll never have the big house on the hill or the fancy car, believing that they'll be better off in older age is an incentive to get up every day and go to work.

"If large numbers of people don't see the point in paying into pensions, or saving for older age, as it will be taxed away or taken from them in care fees or whatever, the welfare bill will rise exponentially. More and more people will realise that they'd be better off on PC and spend their spare money on cars, holidays etc."

Large numbers already spend their income month to month and borrow as a way of balancing the budget. They pay for their holidays and cars month by month. Others save and invest for the future, the lucky ones will save enough to make a difference, most will end up in the same care home as those that didnt save.

The very lucky ones will accumulate enough to make a difference in retirement, in most cases it's going to be because of property inflation NOT because they have worked harder, although they will have made smarter investments.

The source for that is The Private Office, and I don't know what, or how reliable it is, and it's not clear what sort of average is being used, but it's a start.

DD. Those are government numbers to 2024 after housing costs (AHC).

www.gov.uk/government/statistics/pensioners-incomes-financial-years-ending-1995-to-2024/pensioners-incomes-financial-years-ending-1995-to-2024

The £282 for singles is an average for men and women. Further down, you will see that single men had an average income AHC of £292 while for women it was £278.

Single women comprise two thirds of all pension credit claimants.

Section 8 of the link explains how the numbers are arrived at:

[ Quote]

8. About these statistics

How do we measure income?

The main income measure used in PI (Pensioner Income) is weekly net disposable unequivalised income, calculated for both BHC and AHC. Estimates should therefore only be regarded as broadly indicative of pensioners’ overall living standards. BHC income comprises total income from all sources for all members of the pensioner unit.

Income is net of:

• income tax payments and National Insurance contributions
• domestic rates or council tax
• contributions to pension schemes
• all maintenance payments
• student loan repayments
• parental contributions to students living away from home

Income AHC is derived by deducting a measure of housing costs from the overall income measure.

Housing costs include:

• rent (gross of housing benefit)
• water rates, community water charges and council water charges
• mortgage interest payments
• structural insurance premiums
• ground rent and service charges

When looking at individual income components, figures are calculated from gross income.

[End quote]

Google tells me that In the UK, the average income for a single pensioner is £282 per week (£14,664 per year). For retired couples, the average combined income is £595 per week (£30,940 per year). This total includes income from the State Pension, workplace or private pensions, and other investments.
The source for that is The Private Office, and I don't know what, or how reliable it is, and it's not clear what sort of average is being used, but it's a start.

As those figures include SP, it's very clear that cutting SP for people with above average earnings would make life impossible for average citizens. The figures take no account of property or other assets, but cutting pensions on the assumption that older people could sell up and release equity (so move away from the friends and family and other support networks) would be cruel, and wouldn't help much anyway. Also, it would mean that those in subsidised housing with nothing to sell would end up better off than those who had bought a house over many years.

Add to that the fact that people with houses are expected to sell them if they need care, that those with even small occupational pensions don't qualify for things that go to those on PC, and so on, there would be no point in saving anything at all for those who can't afford to save enough to lift them right out of that situation. People pay into pensions and savings so that they will be better off in older age than if they hadn't. If that's not going to happen, then why bother doing without when you're young enough to enjoy your money?

If large numbers of people don't see the point in paying into pensions, or saving for older age, as it will be taxed away or taken from them in care fees or whatever, the welfare bill will rise exponentially. More and more people will realise that they'd be better off on PC and spend their spare money on cars, holidays etc.

As usual, those with significant pensions and/or savings often can't imagine what that dilemma might be like, and nor can those who have always lived on benefits or minimum wage with no choices about how much to put aside for older age to be made.

It's the same people who are affected - the 'just above poor' and the 'not quite comfortable'. They are the ones who pay tax via PAYE (so no allowances for this and that), work long hours, pay rent to the better off or mortgages to the bank, and so on. Average people, basically. And they are the ones who are sick to the back teeth of finding that it was all for nothing, as they'd be just as well off if they hadn't bothered.

I really think that it is this group who need to be considered, as they are numerous, and getting more and more disenfranchised. They are, therefore, more likely to turn to Reform and so on than those who are comfortable (or wealthy). I don't know the answers, but we need to stop making tax on 'working people' the default way to raise money, and look at other ways of doing it.

I can agree with that.

"The problem therefore David49 is your provocative suggestion that a household with £500k wealth in 2026 constitutes the top 20% of wealth holders win the UK- it doesn't. It did not even meet the top 20% threshold 4 to 5 years ago and is more likely hovering around the average wealth in 2026."

Pension paid is fixed per person 20% of pension fund cannot be the average wealth, it's very difficult to pin down the point that a 20% (or 10%wealth) threshold would apply threshold would apply, most of the statistics refer to income.
Clearly a lot of homeowners have properties valued at £200k or less and little private pension, others have houses worth £1m + plus and a private pension pot of £1m as well, where does the 20% threshold lie?

The principle that we should not give benefits to those that dont need them applies just as much the WFA, we know that wealthy families have enormous advantages over a poor family, if we are to have wealth tax it needs to apply to a much larger group than the ultra rich.
Obviously most of us would like any tax to apply to someone else, we all want as little tax and as many benefits as we can.

"Right, but what if, like mine, the house hasn't been valued for decades as it hasn't been sold? Obviously selling prices are easy to find, but that only works if the house is sold."

If the property hasnt actually been sold or valued the valuation Office will use an index or comparison with the relevant class of property when the transaction was done

For example if you inherit or are gifted a property and rent it out for 20 yrs, there will probably be no formal value recorded. If you then decide to sell it CGT will need to be paid on the gain, VO will use the house price index to establish the original value. If the CGT rate is increased to income tax rates that will really hurt private landlords, so if you are thinking of getting out do it now.

Houses only qualify for zero CGT if they are your main residence, a second home doesnt

It's OK. I have no intention of replying.

No need - just don’t respond to what I haven’t said, or twist what I have!

You don’t agree with me, which is fine, but I do have a right to an opinion. I have often said it - to me, a fair society is based on ‘from each according to ability, and to each according to need’. Not in any extreme sense, but as an underlying principle of a welfare state that provides for all of us.

If a partner provides for another, they should pay their share of tax, too.

I am biting my tongue

Yes, means testing reduces incentive at all levels- whether to go for promotion, to work more hours and lose benefits at one level, or to cut hours and keep taxation below additional rate at another.

Why would people want to contribute to what has always been a universal system if they are going to be excluded from it? The charitable of heart are always free to donate to good causes- and many do, whether rich or poor. If systems are fair, people are more likely to be willing to stay within them, I assume. It’s when people feel taken advantage of that they feel resentful.

LemonJam

Cossy raises an interesting point about "joint assets" and measuring wealth by household rather than individual. But sticking with that...

ONS data- April 2020 to March 2022 calculated top 10%, top 20% and Median household wealth in the UK:
1) Top 20% threshold required a net worth of roughly £600,00 per household.
2) Top 10% threshold required £1.2 million or more
3) Median wealth, ie the average adult's net worth hovered around £400,000 household wealth in that period.

The problem therefore David49 is your provocative suggestion that a household with £500k wealth in 2026 constitutes the top 20% of wealth holders win the UK- it doesn't. It did not even meet the top 20% threshold 4 to 5 years ago and is more likely hovering around the average wealth in 2026.

I doubt anyone would support anyone forfeiting SP eligibility if they hold average household wealth.

IF the UK decided to go down your suggested route David49 the more sensible threshold would be top 10% wealth households forfeiting SP eligibility. There could be consideration of state pension payment reductions tapered downwards to the top 15% households over time. Over further time tapered downwards to top 20% households as part of a planned Reform approach over time.

👍👏👏👏👏👏👏

There are a lot of 'maybe's in there . Also, the rich partner will be paying his or her own tax, not that of the spouse. The point of a graduated tax system is that the more you earn the more you pay, not to take some people out of the system altogether. And paying for expensive items for their own use doesn't make that ok, in my book. I really don't want to have every financial argument in one post, but it isn't easy to pay for all healthcare - most private care uses NHS staff and facilities, so those who pay just jump the queues. Also, there is no private university system, so those buying private education are taking teachers from the common pool (paid for by all) in the same way as doctors are trained by the NHS then often practise privately.

If a partner provides for another, they should pay their share of tax, too. Maybe at a lower rate - say an extra 60%? The high spending couple can save on childcare, for a start - something that takes a lot out of the earnings of the lower-paid.

Anyway, I am not on trial here, and I don't know all the answers - I just gave an opinion on how not everyone does pay tax, which is how I see it. And yes, Tice and Farage come to my mind, too .

Thanks Doodledog for your clarification: "what I object to is people not paying taxes who are capable of doing so. Whether they have rich partners, offshore accounts, good accountants, I don't know - anyone who could work but doesn't is 'taking out' but not contributing to the things we all get free in the UK. The things you are pointing out, basically.

If someone has a rich partner who provides for them I would imagine the rich partner is paying tax act 40% or 45% and they are both likely to be big consumers paying high amounts of VAT etc etc. Shares, savings and purchases of high value homes will attract tax payments also. Plus they are more likely to pay for private health care, education etc and might not be accessing many universally available UK services.

I agree it's frustrating that people with good accountants and offshore accounts can reduce the amount of UK tax they pay (Tice and Farage come to mind!)

Lemonjam I agree with your first post, and am well aware of the points in it, other than - as I said earlier - I don't think that people who have no money of their own are paying tax, but never mind.

In the second:
1) People do get Pension Credit if they don't qualify for a SP based on contributions (I'm sure you know that). this often makes them better off than those who have paid in for decades. Also, they will get free social care if they need it, whilst others have to pay.

2) Yes, so those with savings may get less by way of legal help than those without, which I think is wrong - income and disposable income are different things. Anyway, by 'law and order' I meant living a country with a police force/parliament etc.

3) Yes, I know! But not all pay towards that provision (and I absolutely am not advocating that there should be a two-tier health service - just saying that capable adults should contribute towards expenditure in some way).

4) I am aware of that, too . This is a strange line of questioning.

I would not want to see any of that change, apart from wanting legal aid and post-school education to be universally free so society is fairer and offers more equal opportunity to all.

I repeat - what I object to is people not paying taxes who are capable of doing so. Whether they have rich partners, offshore accounts, good accountants, I don't know - anyone who could work but doesn't is 'taking out' but not contributing to the things we all get free in the UK. The things you are pointing out, basically.

That doesn't mean I don't think they should get those things - just that they should pay towards them. If they don't want a paid job, they could be expected to do voluntary work or something. Just 'do their bit'.

It worries me that so many people feel so disillusioned that they are turning to parties that will make things so much worse for all of us. IMO there needs to be a social contract, so that everyone can expect to get healthcare, housing, education etc when we need them, and to make a contribution towards that if we are capable of doing so. Then people won't resent working 40 hours a week for a wage that leaves them reliant on benefits, and paying high rents to pay landlords' mortgages. Too many people have nothing left at the end of the week, never mind the month, and when they see those who don't work getting as much or more than they do, they resent that.

Please don't lecture me about the welfare system, or the benefits of working to the wellbeing of those who do it? Those things may be obvious to people who have had rewarding jobs, but less so to those who have to declare their inheritance of £3k and have it deducted from their UC, and to those who work nightshift in a factory so that they can get the children to school and sleep while their partner is working days.

I repeat - I am talking about policies, not individual people.

Careful, Iam. You'll be accused of being a eugenicist or something before long 🙄.

I won't shoot you - I agree, and think that many others will too. It is the feeling that some work and others don't (but then get as much as the workers) that is, IMO, turning people to parties like Reform. Whether or not everyone pays tax, it tends to be income tax that is increased to raise funds, so workers' efforts are less and less fruitful, prices go up more and more, and if workers are then told that pensions are to be given to those who have not contributed instead of those who have, I'd expect to see strong objections.

Like you, ( Iam ) I am fairly comfortable, but only because I (and Mr Dog) both worked from 16 - 66. We have inherited nothing, and know that if we need care (as MIL does currently) we will leave little behind for our children, who both work and pay tax too. It does make you wonder why you bothered, sometimes.

Twisting that to suggest that we don't support a welfare state is preposterous.

Doodledog "I don't think it's fair that people who don't put in should take out":

1) SP- Not everyone automatically gets a state pension in the UK- it's strictly based n National Insurance contributions.
2) Legal aid is means tested.
3) Health care is free at the point of delivery for all UK residents.
4) State education is available universally for all school age children

What would you like to see change if anything?

If people can afford not to work, that's fine, but IMO, they should pay a contribution towards living in a country like the UK, where many things are universally provided, and they should not expect to get pensions after a lifetime of not working, or benefit from the contributions of those who work because they have to.

How are they supposed to 'make a contribution' if they're not earning?

Doodledog

Tuliptree

Chocolatelovinggran

David, surely any pensioner with an income above £12500 pays tax, exactly the same as everyone else over this threshold?

Everyone pays tax regardless of income because income tax is only one kind of tax. That’s one reason I don’t like people talking about taxpayers - as though they are a distinct group in society.

I think we may have had this discussion before, but I don't see how someone with no income is paying tax. If they spend money that someone else has given them, it is the giver who is paying the tax, surely? If I give someone the money to buy me a bag of potatoes, or to get themselves a box of chocolates (or whatever), I am still paying the tax, I think. It has come out of my taxed income already, but when it is spent I am paying tax again - regardless of who goes to the shops.

Income tax is paid by those who earn above the threshold- currently £12,750- this is a direct tax. Capital Gains tax is applied to profit when a person disposes of assets ( other than their primary residence). Inheritance tax is paid on aa person's estate after death if it exceeds the IHT threshold.

Stamp duty tax is paid when buying property, Business rate tax and Corporation tax levied for those in business etc.

The there are indirect taxes or consumption taxes- e.g VAT applied to most goods, Excise duties tax on alcohol, fuel, tobacco and gambling and Council tax.

It would be extremely rare for anyone not to pay any of the direct or indirect taxes listed above.

I’m late to this, as ever. It’s been a very busy week.
Anyway, back to the OP, I’m opposed to scrapping EDI (and the ECHR which to me goes hand in hand)

Confession, my 35 years in public service, plus paying add ons to the pension scheme means I’m ok. Not wealthy but combined with my state pension means I can eat and more importantly, afford to keep my dogs. I started work at 17 retired at 63 because RA stopped me.

Any savings I had with mr I (bless his soul) have been distributed to our adult children. They’re working, contributing , paying tex and looking after the next generation. I’m a simple soul, I expect that’s the case for other fortunate people like me.
David, I don’t white understand how cross, negative, cold and critical you are about our generation. Generally speaking, we grew up far from the lap of luxury, we’ve worked throughout our lives, managed in many cases to buy our houses. I hope never to need residential care. If I do, I expect my adult children to lose the little I’ve left to leave them, our family home.
I’ve mixed feelings about this despite my leftie leanings. I’d like them to inherent the home they grew up in, still refer to as home. Is it fair that those of us who worked etc etc to subsidise those who made different choices. I’m not talking about those who need our welfare state….. shoot me now

That comment has really upset me, so for the record I would like to repeat what I have said many times before, which is that when I have commented on tax/NI/contributions, it is in the context of policies, not people. I don't think it's fair that people who don't put in should take out, and I think it is often forgotten that 'taking out' is not always in terms of cash. Using facilities and benefitting from things like the NHS, defence and law and order are also taking out, and there are many who don't pay towards them, often because they can afford not to do so. If someone is unable to work because of illness, disability or caring responsibilities for those who are sick or disabled, then of course there should be provision for them - in fact IMO it should be better than it is now, and could be if the system wasn't paying out to those who choose not to work.

If people can afford not to work, that's fine, but IMO, they should pay a contribution towards living in a country like the UK, where many things are universally provided, and they should not expect to get pensions after a lifetime of not working, or benefit from the contributions of those who work because they have to.

None of that means that I think they are lesser beings. We all do what works best for us at the time that we do it, and I certainly don't think less of people for making choices that are perfectly legal and harm no-one. It is the system I don't like, not the people. I have said that several times, too.

MaizieD

Doodledog

I wasn't for a moment saying anyone was less valuable as a citizen than anyone else😳. That is really putting words in my mouth.

I was responding to the idea that everyone pays tax, when clearly they don't, and it doesn't matter who they are. The idea that this is relevant to their value as citizens is in your head, not mine.

As you are constantly complaining about people who don't pay income tax, notably SAHMs, I can only conclude that you don't think that they can be considered as valuable citizens.

And you don't seem to think that any other taxes exist apart from income tax and NI as you won't allow that anyone who spends pays tax in one way or another.

What am I supposed to think?

Well, you are supposed to look at what I write, not taking account of chips on your shoulder or assumptions you are making?

I'm actually quite insulted by the idea that anyone would think I assume that not paying tax makes someone a lesser human being. In all the years I have posted on here I have never said anything remotely like that.