How long can babyboomers expect a 'free lunch'?

The answer is to abolish means testing. Introduce a flat rate pension based only on residency and then tell everybody they are on their own.

@Keith, agree.

Instead of blaming baby boomers why not address the politicians.

what is a baby boomer supposed to do refuse the minimum 2.5% yearly state pension increase?

We all know that pensions should have been tackled ages ago but having a go at baby boomers, who in reality just used the chances to save, is ridiculous they did not make the rules....politicians did.

You just know from the headline when it's going to be a Michelle McGagh article!

Every generation passes on the consequences of its own successes to the next generation, too. Or tries to, if their successes can be kept out of the hands of an overgrown and inefficient state.

Have you thought how you would live on the state pension, Michelle? Or how you would look after your parents if they didn't have a pension?

What I strongly resent is the inappropriate emotive language. As a baby boomer, I am not "asking for a free lunch" nor am I "demanding" anything. Over a working life time, I've paid taxes and contributions as prescribed. Now I'm claiming the pension the state tells me is my entitlement. No free lunch, no demand.

Pension liberalisation is probably foolish - it certainly looks like a political game aimed at short term advantage for Osborne. The whole purpose of pensions is to provide a lifetime income after work has ceased to provide it.

It might well be that there is a problem with growing numbers of retired people. I've been expecting such a problem for almost sixty years - it was obvious as schools expanded to take the first wave of boomers. So we shouldn't really be unprepared.

But there is no need to pitch this in terms of one group having taken advantage of another. We will need to resolve the problem as fairly as we can.

Really, though, the biggest problem is the small group of people who have hugely enriched themselves beyond all reason or justice at the expense of everyone else. Efforts to scapegoat groups such as the poor or baby boomers is nothing but a smoke screen.

What a disgusting conclusion from a disgustingly misdirected report.

A far better question would be - how long can politicians expect a free lunch? They're the ones responsible for robbing everyone decent blind whilst rewarding themselves excessive pay and expenses.

Politicians are the ones that have filled the country up and sold the country out to appease the EU / party donors (house builders, bankers, etc...) so that when they've finished ripping off the taxpayer, they move to a cushy number in the city or Brussels.

It's nothing more than crushing irony to claim that people who have paid into the system are having a free lunch whilst politicians engage in the most chronic treachery by throwing away the country's wealth and heritage whilst tolerating/encouraging benefits scroungers and engineering a major demographic shift that threatens everything Britain used to stand for.

I have paid vast sums of money during my working life to fund the state pensions of people in older generations plus a huge amount bringing up two children, and now it's payback time. That's what I call an implicit intergenerational contract.

This intergenerational conflict approach really makes me sick. When I look at today's youngsters' lifestyles and compare them with my own as I progressed through the decades (yes, I am a so called baby boomer) all I see is that in many respects they expect far more instant gratification than my generation ever did.

Surely it would be fair to all if the pension is related to no of years paid in and a fixed contribution?

Pension age 75 so max 60 years

Completely irrelevant, as any "Report for Labour" has been, is and will be while Tombstone Ed or The Commissar and his Neo-Trots were/are in charge. Another 9 years in the wilderness?

David 111 - not much else for them really...

The 'baby boomers' have paid in for over 40 years and so paid for previous generations state pensions. But that's ok I take it?

Cowardly governments in collusion with the retirement vote have consistently fleeced the young with high taxes, university tuition fees, the effective abolition of defined benefit pension schemes, grossly high house prices and the end of job security. In a nutshell, having had all these benefits themselves while keeping the retired of their day in poverty, they have drawn up the drawbridge on those that follow - for what reason? To pay for a retirement welfare system of unprecedented generosity for themselves that will not survive to the next generation.

Just for starters, the state pension age needs to be equalised with immediate effect. Also a % of employer and employee National Insurance contributions should be diverted into a sovereign wealth pension fund - with a lower rate of contributions where an acceptable defined benefit pension scheme is in operation. And no, you should under no circumstances be able to blow your pension pot in one go and make yourself dependent on the young - the whole point of pension tax brakes is to avoid such dependency in old age.

"The 'baby boomers' have paid in for over 40 years and so paid for previous generations state pensions. But that's ok I take it?"

Er. No. The generation prior to the boomers lived in old age poverty and the boomer cohort will take out 120% of what they put in. But don't worry eh.

As a babyboomer I have got another 15 years before my state pension age. Can't say I am going to be the lucky generation. I don't think I am safe now It wouldn't surprise me if the goal post aren't moved yet again. 67 at the moment and counting.

"Er. No. The generation prior to the boomers lived in old age poverty and the boomer cohort will take out 120% of what they put in. But don't worry eh."

Not so simple. Many of my parents' generation had long, comfortable retirements on defined benefit schemes. Only some lived in poverty. Plenty of boomers have been excluded from defined benefits.

One would expect each generation to take out more than they paid in, if pensioners are allowed to participate in generally rising living standards. Isn't it a good thing to remove them from poverty.

The writer of the article is trying to make political capital out of a sorry mess brought upon the nation by a number of factors, some of which are squarely in Labour's camp, others the 'fault' of many different elements.

First, when the State Pension Scheme was set up in the 1940s, nobody knew that the UK's life expectancy was going to rise so high. So in the early years, the total amount to be paid out in State pensions was much more limited than it became subsequently, and there are, as the writer says, no free lunches. So contribution levels and/or retirement ages should have gone up as life expectancy rose, and no governments grasped this nettle, because the electorate prefers free lunches and votes accordingly, like Romans preferring bread and circuses.

Secondly, the State pension was and is unfunded. No pension pot is built up for each individual, and there has therefore been an inter-generational robbing of Peter to pay Paul right from the outset hard-wired into the whole State Pension system.

Thirdly, some people could have afforded to contribute more for their retirement, while others did not have enough money to do so, some because pay levels were too low, others because of a personal failure to defer gratification - furniture and entertainment today already had a wide appeal compared with retirement saving for 20 or 30 years hence back in the 1970s. That's what people are like. They won't change.

Fourthly, a mere 15 years ago, Britain had the best private pensions in Europe. But then Gordon Brown took away some of the tax advantages of pension funds, making the cost to employers higher, and then the 1980s pension scandal resulted in more rigid regulation, and the need for pension funds to invest more in gilts and less in equities, so that although theoretically safer, the net result was that providing a decent retirement income cost more again. So naturally, more and more employers decided to water down or close the defined benefit schemes that had provided security for pensioners in the private sector. Now only MPs seem to have retained this level of retirement comfort.......

Fifthly, the excesses of the 2000s led to governments around the world forcing down interest rates, causing the price of gilts to rise and the value of annuities based on them to fall, as a result of which nobody wanted to be forced into taking an annuity because the income levels were so minute relative to the capital cost of that income. Annuities just looked even worse value than before.

Finally, George Osborne has moved the pension tax goalposts again and again, so that now the incentives to make pension contributions have been reduced again, and people are much more than at any time since the 1940s being left to their own devices without any real attempt to force people into saving enough to fund their own retirement, other than a token gesture level of compulsory contributions to workplace pensions which will never provide enough retirement income and in many cases the employees are better off doing their savings in different ways.

What a mess.

Now, in just two short paragraphs, here is how to sort out the mess........

Oh dear - no space left to write more!

This must be the first time that every post is in complete and justifiably angry agreement. I have earned a salary, paid tax and national insurance since I was eighteen and retired at the age of fifty nine four years ago. I have never in my life claimed a penny in un/employment benefit. The state pension which I have earned, paid for and have every right to, will stat to be paid in eighteen months unless some form of legalised and immoral government theft prevents it. Every single paltry penny has been earned and paid for by hard graft. I am fortunate that it will represent but a small proportion of my retirement income but that doesn't alter the fact that it is paid for and mine. A quick calculation tells me that I have paid around £2m in income tax alone during my working life. 'Asking for a free lunch'!!!! I am not asking for a free lunch; I am demanding a burger when I have paid for fillet steak!

My point is that the baby boomers go from 1946 to 1964. I don't think people born towards the 1964 end have been practically lucky. 1940 to 1958 perhaps.

With 15 years to go till I retire and possible goal posts being moved between now and then. I may not be any better off than the younger generation. I may make up part of the shafted generating along with all the people that are younger than me. You can't say I have been part of the lucky generation until the fat lady sings

Whatever your views on the competency of current & previous governments, their actions have basically been contained by what would be acceptable to the electorate – and that means us.

Since the 1940’s, life expectancy has increased through a combination of wealth, giving better living conditions and medical advances. We so often hear about how medical advances saves lives, but that’s not actually true. Medical advances & improved living conditions only delay deaths. The net result is an increase in the number of pensioners, many of whom are living for longer. It’s not the fault of these pensioners that they are creating a far higher bill than was expected, they’re just claiming what they were promised and what they have paid for.

Neither is it the fault of the younger generations. Advances in technology has resulted in industry running leaner with far fewer well paid jobs available (globalisation has also seen jobs move to lower cost economies) – how many workers does it take to produce a Nissan Qashqai compared to a Ford Cortina?

A massive increase in the demand for housing has been caused by a larger population (and a number of other factors), which has inevitably resulted in far higher prices (although we shouldn’t judge the whole country on London prices/problems).

Ultimately we’ve created an unsustainable model where our taxes fund an NHS that offers ever more expensive treatments that helps to create more pensioners who live longer (taking more of the available tax pot) and leaves them living in houses that adds additional pressure on prices.

Something has to give and the electorate has to allow the government (whichever government that may be) to make some pretty unpalatable choices.

Should the brief of the NHS change so that treatments are reduced once you reach a certain age? Should the bedroom tax be widened to include the whole population (with tax breaks for pensioners/singles who choose to house share)? Should assisted dying be legalised & even extended once the standard of life drops below a certain level?

Can you imagine the outcry if the government tried to introduce any of these changes? Yet the reality is that if we don’t make fundamental changes to the current model then nothing will change – The pensions & NHS bills will be unsustainable and the younger generations will have no chance of living the life that the baby-boomers were promised and have paid for.

Is that wrong? Do we have the courage to make such fundamental changes? Big questions, difficult decisions, but they need to be addressed by each and every one of us.

Slash civil service pensions, slash MP's pensions. They can afford it. Stop giving money away to other countries and halt immigration. There you go, enough savings for a decent pension of all who have contributed.

"every generation passes the consequences of its own failures down to the next generation".

Sadly, the iniquitous IHT persuades the same generation to spend everything rather than being able to............

"pass the consequences of its success down to the next generation".

trout bites fly

There isn't total agreement. I don't think that older people, of whom I am one, can just sit back and talk about what they've paid in and what they're entitled to. There will have to be compromise in order to deal with the population issues. But there really are far more important political battles in relation to fair division of rewards, and they aren't to do with foreign aid, benefits, immigration etc. Pitching it as an issue of old versus young is stupid and unhelpful.

And the question of funded pensions is a red herring. There is no real difference between funded and unfunded pensions - just different pieces of paper. The reality is that pensioners and children have to live on the fruits of the labour of working people. The rest is just accounting.

Why is it always private sector pensioners that get criticised for saving for their old age, and then get clobbered by successive governments because they are saving too much? I see no mention of the massive increase in the public sector, especially under Labour, and the resultant pension black hole which will see 'baby boomer' public sector retirees living longer on fat final salary pensions, funded by everyone else.

I worked in local government for a few years at the start of my career in 1972, but when I married, I left for the private sector and took out my pension contributions to buy a made-to-measure wedding suit from Burtons and pay for a deposit on a rented flat. Imagine my surprise recently when I was informed that I was due a £6000 lump sum and a small index-linked pension for the rest of my life. For someone who did not realise he had any public sector pension entitlement, what does a pension look like for someone with 40 years service?

For example, I know of a couple who spent their life in local government, and while one still works (because she can't face life not working!), their joint pension will be £110,000 pa.

Governments find it easy to plunder private sector pension funds, and then come back for more, but won't touch the public sector.

@uncommercial, there is a big difference between a funded and an unfunded state pension. Both types of pension are exposed to the demographic pressure of increased life expectancies, but funded pensions are immune to demographic anomalies such as the Baby Boom because you are paying for your own pension and not someone else's.

And of course there's the simple fact that the current unfunded pension system is basically a Ponzi scheme, but apparently it's perfectly legal to run one if you are the government.

The State Pension Age was 70 years when introduced. It should rise from 66 in 2020 to 70 by 2040. One year for every five fears.

NI contributions to 44 to qualify for a full pension. It was 44 before it was reduced by Blair goverment

LouisV-W4 - I worked all my life in local government, eventually retiring from a reasonably senior middle management level job. I can assure you that my pension is well below a quarter of your friends' £110,000 a year! I can only assume they are or were both at director level. Most local government employees retire on very modest pensions (well below the level of mine), whatever the public believes.

@PaulSh I'm afraid that is complete rot, and it is grossly misleading to describe state pensions as a Ponzi scheme.

Lavochkin: “Should the brief of the NHS change so that treatments are reduced once you reach a certain age?”

Why do you believe that such age discrimination does not already exist? In 1998, when my Father developed heart disease, his GP told my Mother “You’ve had him for 40 years, what more do you expect?”

And how long should people with children expect a free lunch at the expense of those with no children? And how long should the unemployed expect a free lunch at the expense of those who have worked all their lives.

This report is totally worthless, there are too many people who expect to be kept by taxpayers for all their lives. Pensioners have paid into the system and deserve the benefits of contributions at retirement, just as their taxes supported pensioners when they were younger.

@ Keith Cobby.

Re your suggestion of dropping a Contributions Requirement for qualifying for State Pension and replacing it with a mere Residence Requirement, this would mean that huge numbers of immigrants who have never paid anything in, and their ageing relatives would qualify for a UK State Pension.

Immigration would soar even higher.

What a huge cost to the Britsish taxpayer

I have a simple question. Do the authors of these articles ever read the responses? If not, why not? If so, could we have a considered response to this virtually complete rejection of Ms NcGagh's arguments, please?

Boris, I'm not saying that there isn't already some age discrimination in the NHS - especially at an individual level. The point I was trying to make is that as a society, we expect ever improving health care and ever more complex & expensive treatments, with no consideration for how we are going to pay for it.

At an individual level, we would all want our health service to do anything and everything to keep us and our loved ones alive for as long as possible. However, for our society as a whole, is that the best approach?

The question that I have in my mind is whether it may be preferable to focus our resources on the younger generations. Not exactly "live fast, die young", but wouldn't you prefer to have a higher proportion of your lifetime earnings to spend during your most vibrant years?

Not everybody will, but that doesn't mean the question shouldn't be asked & at the moment, we don't really have this option.

My wife and I are baby boomers, we have brought up 2 children. We paid for childcare no vouchers or grandparents

We worked during university vacations as we both came from working backgrounds.

We didnt/dont smoke, didnt go out much.

gradually moved up the housing ladder

We looked after 3 parents without any additional handouts for care etc other than NHS medical care

WE saw politicians say no tution fees and then stitch everyone up

We have seen pension promises denied ( I saw my MP a number of years ago and he denied what is happening)

The bus pass is never within reach , the pension age keeps moving - broken promises, and dont get me started on flat rate pension

NHS gone to hell in a handcart

Care homes fleecing everyone with 3rd world standards

If old age was so wonderful why dont the youngsters want it

We have never had a debt other than a mortgage

If the young people think its wonderful did they have wars to fight, rationing

Hard manual labour - the boomers are enjoying what they paid for

The young never had it so good

The problem lies in the politicians and rip off Britain

Euthenasia is the way forward check in at 75

An analysis as pathetic as I would expect from anything commissioned by the Labour Party.

We are "baby boomers" and have already helped two children get their own homes, as well as giving continual help to children and grandchildren.

Boy oh boy do I resent this utterly crap-awful article, as others have remarked.

We got "lucky" by working, in my case, the equivalent of three full time jobs for years, forever doing stacks of freelance work, also renovating property and working exceptionally hard and long. Do that and everyone can be "the lucky generation."

Yes, we also paid in contributions for about 45 years and still pay lots of tax.

If the government needs money it should start by getting hundreds of thousands off "the sick" as many are just slackers, well able to work. (I exempt the genuinely sick, of course.)

Next, stop hundreds of thousands of immigrants pouring in, many with their hands out for homes and handouts. Then we would actually have homes to go round and plenty of money to look after those who really do need help.

Also, we should scrap the absurd idea of foreign aid, which goes to nations like India with space programmes. We should also get the heck out of the clasp of the absurd, overbearing bunch of unelected morons (the commissioners and judges) who rule us from Brussels and Strasbourg. They also take £55 million a DAY from us. Some twerp giving out leaflets said to me today :"But we get some of it back." How kind of them, to give us a small percentage of our own money back.

Off to take a couple of aspirins.

It only comes back with strings attached. "Support" for small businesses has actually cost my business time and money, in other words, money and money, since wasting my time is also a cost to my business. I could have been doing something more productive. In contrast, those providing the "support" actually get paid for it, whether it helps or not.

A ludicrous, ill informed article, presumably from generation whinge. The reality:

It's official: the British state pension at a maximum £110.15 a week is the most miserable in Europe. Compared to average income, even Hungary and Slovenia better the pension benefits 12.3m British pensioners receive, according to a new OECD report.

British workers on average earnings typically get a state pension worth 32.6% of their working wage.

What I don't understand is how there are so many tax-payer funded pensions of £55k-60k+, from age 60 or lower, at a time when the lifetime allowance applicable to the rest of us (if we could reach it) would buy less than half that amount. Why is this happening at a time when others are facing working until they drop? How can that be justified and how much would be saved if there were a cap?

Michael Stevens' point about 44 years of NI is interesting.

Geoffrey M is right too about how not all Boomers are in the same fortunate situation as others. Some Boomers will face more difficult retirements than their parents, mainly due to demise of DB pensions.

Generalisations have a lot to answer for (and Steve Webb is very good at them.)

It is interesting that many do not know that many pensioners have state pension plus SERPs total of £10,000, £12,000 or even over £14,000 per year. Just from the NI full contributions

NI should rise to44 years and retirement age 70 by 2040

Michael Stevens' point is yet another example of the the intergenerational injustice between the retired, and those who are young. Being in the middle age wise, I contributed to the SERPS in my early working life for about 12 - 15 years, in the mistaken belief, as it was then promoted, that SERPS was the equivalent of a defined benefit occupational pension. Since then what I thought was a guaranteed pension has been steadily watered down to a projection ivalue n effect of zero; although in theory it will be worth the wonderful sum of £20 per week, this will be fully absorbed by the new flat rate pension of £155 - which based on many future years of increased National Insurance Contributions going forward, I would be qualifying for in any event. I expect many others will be in the same position.

@mark antrobus That's just plain injustice. It doesn't really clarify anything to call it intergenerational. The situation you describe is primarily the result of schemes devised by George Osborne. Neither Osborne nor Cameron are baby boomers. They are people who seem careless of the principle that government policy should attempt to be fair to all citizens.

but they write this:

"The government is committed to ensuring older people can live with dignity and security in retirement."

vs £8060 at £155pw

Sorry, that followed Michael's 18:36.

Discussions on 'Intergenerational' injustice, promoted by people like Tessa (two homes) Jowell are always very restricted in their scope.

What is needed, if existing older people are to be vilified, is a proper system of

'Intergenerational Accounting' which includes the value of one generation bringing up the next one and handing over to them a fully functioning world and infrastructure.

But there is a problem with generalisations. There are huge variations in the circumstances of Baby Boomers, there are unemployed 61 year olds living on savings (if they have any) due to age discrimination; same variation applies to younger generations for different reasons.

@dd

But the present debate about "Intergenerational Unfairness" which is increasingly bubbling up, and will get worse, is and will be conducted in generalisations, however the specifics to which you refer can all be taken into account in a 'macro-model' of Intergenerational Accounting.

Good!

Enough already!

Adjusted for inflation, how much has it cost to build the M1 motorway and hand it over fully functioning (more or less) to the next generation ?

We all know that modern science is helping everyone to live longer so people have to save for themselves to supplement the state pension.

Politicians must learn to put all National Insurance money into separate funds for State Pensions and for the NHS, which is what they were designed for, and not to be added to the general kitty for them to squander as they think fit. Then there will be enough for a decent bread and butter payment every month for pensioners that have worked all their lives. The jam and the cream must come from their own savings.

The Government must also encourage people not to spend money they do not have. If you cannot afford something, save up until you can.

P.S.

I am sure that our illustrious leaders award themselves much better pensions than the OAP.

A huge problem is UK Population Growth.

Office of National Statistics (ONS) show 53% of last years growth came from direct immigration.

This represents a huge competition for younger people seeking housing and good jobs with pensions and good 'tax payer affordable' state pensions.

Pointing at the older generation and claiming they have been greedy is just a diversionary tactic to avoid mentioning this uncomfortable and

non "politically correct" fact.