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Pensioner benefits: why means testing won't work

Having survived the Autumn Statement with the CPI-linked rise in the state pension intact, pensioners now face a threat to universal benefits, warns Lorna Bourke.

 
Pensioner benefits: why means testing won't work

Plans to means test universal pensioner benefits may be sensible in theory, but the expense of identifying better-off pensioners would likely offset the savings, says Lorna Bourke. 

Pensioners' benefits in the firing line

Nick Clegg’s call for means testing of universal pensioner benefits such as the winter fuel allowance, bus passes and free TV licences, will infuriate the 12.6 million beneficiaries – a lot of pensioners to antagonise ahead of any election.

There is no doubt that this universal largesse is an inefficient use of government funds at a time when the Treasury is aiming to cut an estimated £30 billion before the end of this parliament in 2015. The cost of tax-free pensioner concessions is an estimated £16 billion. The exact figure will depend on what use is made of the free travel concession.

Pensioners have so far escaped relatively unscathed from the cuts compared with families with children. Parents who are higher-rate taxpayers are to lose child benefit, and there have been reductions in working tax credits and child-care allowances. But the over 65s – who already receive a higher personal tax allowance of £9,940, or £10,090 for those aged 75 plus – will receive the full 5.2% CPI-linked uprating in the state retirement pension at a time when many other benefits are frozen. 

State pension rise maintained

In his recent Autumn Statement the chancellor confirmed that the basic state pension, currently £102.15 a week for a single person, will be increased by the full 5.2% rise in the September’s CPI inflation figure, an increase of £5.30 a week to £107.45 a week.

But deputy prime minister Nick Clegg told the BBC ‘We should be asking millionaire pensioners to perhaps make a little sacrifice on their free TV licence or their free bus passes.’ This has been opposed by Tory ministers, who are fearful of upsetting a large number of voters.

The problem is that unless wealthy pensioners can be persuaded to give up these tax-free benefits voluntarily, the cost of means testing will probably wipe out much, if not all, of the savings.

Bus passes

There are around 12 million people in the UK who are eligible for free bus travel, and an estimated 9 million have a free bus pass. For Londoners, where travel on the tube costs as much as £5 for a single journey, the free travel pass could easily be worth more than £1,000 a year, depending on how many journeys are made. 

Arguably, the unemployed are more in need of free travel. They can easily run up travel costs of £25 a week if they attend several job interviews.

TV licences

This winter, those aged 80 or over will receive a £300 winter fuel payment, compared with the £400 they received last year. Younger pensioners will get £200 instead of £250. Last year, more than 12.6 million people received this benefit. On top of this, giving free television licences to all people over 75 costs the taxpayer more than £550 million a year. 

One way to means test pensioners cheaply would be to remove these concessions from higher-rate taxpayers – those with taxable incomes of £35,000 or more, who can easily be identified from their tax returns. However, only 450,000 pensioners are higher rate taxpayers, so the saving would be relatively small.

Donate your winter fuel payment

Saga, the over-50s group, is running a campaign to persuade wealthier pensioners to forgo their winter fuel payment – worth £200 for those aged 60 and over and up to £300 for people aged 80 or older – and donate the money to help poorer old people pay their fuel bills. 

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47 comments so far. Why not have your say?

kevin clayton

Dec 05, 2011 at 16:59

I think it would be more sensible to raise the age of those getting a bus pass or winter fuel allowance to at least 65. Who becomes a pensioner at 60 these days?

Kevin

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Mike the red

Dec 05, 2011 at 16:59

God, these stupid politicians are really starting to p*** me off. Millionnaires like Clegg don't know jack about the working or even the middle classes, he's never been in the unfortunate position of signing on the dole and being treat like s*** by un trained and uncaring Jobcentre staff. He doesn't even know the rules if this quote is correct

"Arguably, the unemployed are more in need of free travel. They can easily run up travel costs of £25 a week if they attend several job interviews".

Most jobcentres will pay the travel costs to interviews so long as there is evidence.

If ever there was need for revolution its now but wait, we have Sky TV, cheap booze and X factor (strictly come dancing for the brighter citizens) so why would we want to rock the boat?

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Altogether now

Dec 05, 2011 at 17:00

The easiest way to reduce the winter fuel payout is to ask pensioners to apply for it (similar to the free bus pass). Maybe only once every five/ten years send them an application form. It only needs a signature. Those well enough off to not need it will not bother to return the form. Means testing is way too expensive.

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georges

Dec 05, 2011 at 17:02

No means test - that simply adds public expenditure costs. Simple solution - either charge an annual fee for free travel card, say GBP20. People need encouragement to use public transport.

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Martin Drew

Dec 05, 2011 at 17:09

The easiest way to go part way with this is to make these allowances taxable. Those who don't pay tax would keep the full allowance, those that pay some tax would keep 80% of it and those that pay the higher rate would keep 50% of it, or 60% if the rate is reduced. No expense incurred by anyone and although not saving the whole amount it would presumably claw back quite a lot of money. Saga could still run their campaign to get people to donate the balance.

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Mike Greenland

Dec 05, 2011 at 17:11

Take them all away from all pensioners and add the saving to the basic pension. This will save on admin costs and mean people can spend it on what they want. It is ridiculous having these freebies that only serve to make politicians feel good.

...btw I am a pensioner and in receipt of them all...before anyone decides to have a go at me!!!

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cc

Dec 05, 2011 at 17:24

I'm pretty hacked off - I left my job pre-retirement when I moved from London, thinking I could bridge the gap of a couple of years with the capital from downsizing. Since then I've found that both my state pension and my bus pass would be delayed by more than eighteen months. I've always paid full NI and "earned" enough for a full pension and now I find that nearly two years have been stolen from me. I didn't have a very highly paid job but paid AVC's for a few years - just hope that the government don't try to steal that pension too. Still five years until I get that.

I agree with Martin's views on taxing pensioners' "perks" in the same way that workers incentives are taxed. This seems fair. I'd also be happy to make a contribution to the cost of my bus pass - you are in effect getting an annual season ticket for buses - but pensioners don't normally clutter up the buses in the rush hour, and it keeps cars off the roads and out of the car parks. At the moment I am often the only person paying the fare on the bus during the day.

There isn't a political party that represents my views , but if we don't vote we can't expect things to improve. Surely someone will pick up our votes.

Or am I alone.....?

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Barry1936

Dec 05, 2011 at 17:27

Here we go again, clobber the responsible people who saved for their retirement instead of spending during their lifetime. This is no way to give todays generation an incentive to look after themselves in old age; it just encourages them to rely on the State. This is old fashioned socialism which even the Labour Party discovered does not work

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TeaJay

Dec 05, 2011 at 17:31

I suspect that no cost-benefit analysis of this proposal has been carried out - gestures matter more than facts and consequences to politicians who are, after all, mainly spending our money.

I regret to say that mention of the travel perks of Londoners makes me see red - who on earth pays for these and why do the rest of us only receive a bus pass to a service which, in my suburban area of North Surrey, finishes at about 6 p.m.. HOWEVER, the point which really puzzles me is why, given that bus companies have to run a bus, whether it be empty or full of pensioners, which, to my mind, means that the actual cost of each pensioner journey is pennies, the scheme is said to cost our lords and masters so much.

Could it be that one lot of [government] accountants sat down with another lot of [bus company] accountants and proved conclusively that the cost of each space on the bus is £x and that's what needed re-imbursing, totally ignoring the reality of largely empty busses but for pensioners. Thus making bus companies a lot richer than they were.

Bearing in mind that these are the geniuses who brought you the fact that for GP's to provide an actual service when people might be taken ill, that is, during the night, including weekends, was worth, what , £6000 a year and were surprised that GP's, whom they had already offered a 40% or so income rise, decided to forgo £6K and opt for working 'office hours'.

I think I've got the gist right.

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roger cole

Dec 05, 2011 at 17:36

One or two whinges here but mostly quite a lot of sensible practical advice. Clegg and Cameron, are you listening? :)

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Ian Burgess

Dec 05, 2011 at 17:37

Kevin Clayton is correct - delay the payments until a person is aged 65 (well, apart from getting into cinemas and theatres a bit cheaper for over 60s). Clegg is an idiot - doesn't he know that there is a grey vote? Not only has his Party alienated the young vote he now wants to antagonise older people.

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William Dickinson

Dec 05, 2011 at 17:41

If Nick Clegg and his cronies want to "means test" Universal Pension benefits without incurring substantial administration costs the means test could be simplified to those paying 40% tax over the age of 65. If you are in this tax bracket you surely have the means to give up the winter fuel allowance and are highly unlikely to be using a bus pass in any event.

The alternative is yet another government administrative nightmare that costs more to run than what it saves the tax payers and the opportunity for yet another failed government IT project. Without this basic “financial sanity check” the predicted savings from the means testing end up going into paying the salaries of yet more civil servants, buildings for them to work in. This of course ignores the fact that adding yet more civil servants into the system adds yet another burden for the future in the form of their gold plated pensions.

The first rule of any policy that attacks benefits of people in or nearing retirement is that the end result must be a significant NET savings to the taxpayer which includes all of the liabilities, present as well as future. If it cannot pass this basic sanity test it is nothing more than political dogma that will annoy more voters than it will please IMHO.

NET savings calculations should, of necessity, including a "set-aside" calculation for the pensions that will need to be paid by future generations. A bit like the calculations used for the nuclear power industry which include future waste management and de-commissioning costs as part of the operational costs.

After all the government imposed such rules on private company final salary pensions in the form of the 1995 Pensions Act following the Maxwell debacle. However for patently obvious reasons the government declines to impose such rules on itself. Instead there is an ever increasing hidden liability of the public sector pension funding that is lurking in the background for future politicians and taxpayers to deal with.

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Ian White

Dec 05, 2011 at 17:44

As a pensioner I believe that these benefits should be directed at those who really need them rather than available to everyone who qualifies under the present rules but agree that the cost of means testing would probably reduce any saving to near zero. The first and simple thing I would do, as suggested by others, is to link the age at which you qualify to the state retirement age. 60 is definitely too young! I also think that the idea of paying for an annual bus pass, as with a Senior Rail card, is very sensible, so long as it is not too high to discourage the move away from public transport or costs a lot to administer. One thing that rarely seems to be taken into account in these dicussions is the economic benefits to an area as a result of free bus travel. Speaking from personal experience, it encourages people to visit new areas and to spend money while there through shopping, entertainment or eating. It also keeps us 'oldies' active, which is good for health and mental well-being!!

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Allan Harris

Dec 05, 2011 at 17:44

As a former GP I can clarify the last point. That was the deal, £6K a year for cover from 7PM to 8AM, not a generous level of pay. As we were paying £3K each per year to the local Co-operative (ie effectively working for not very much as the payback from night visit fees and the cost of being a member balanced out) we all left in droves and the PCT then found it had to fund GPs to do the night work at £800 for an overnight shift (at the top end - Bank Holidays etc.)

As for bus passes - I use mine a lot and feel no guilt. Parking is expensive and it keeps another car off the road.

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William Thomson

Dec 05, 2011 at 17:45

I pay £28 a year for my Senior Rail Travel Pass. I don't see why we can't pay a fee for the bus pass or go back to the old system where we got a discount of 50 percent. With the WFP why not add it to the pension and make it taxable. That would cut the cost by atleast 20 percent. And leave the free licence fee alone. It is an outrageous poll tax and out of place in today's multichannel world.

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Raymond Davenport

Dec 05, 2011 at 17:48

It makes me woder which planet Nick Clegg is living.

Quote "But deputy prime minister Nick Clegg told the BBC ‘We should be asking millionaire pensioners to perhaps make a little sacrifice on their free TV licence or their free bus passes.’ I have about 1000 millionaire freinds and there isn't a single one of the with a bus pass. Yes Nick, I can dream the same as you do, the difference ? I only dream occasionally.

It all comes down to the same old story. Someone who has worked hard all their lives, paid full national insurance conributions, paid or rather robbed of wages by income tax, taxed every time they spend, paid into private pension schemes to hopefully provide a more comfortable retirement, been thrifty and not wasted money on unneccessary luxuries, saved The Sun Holiday Tokens,paid many times over the cost of their home by way of mortgage interest, AND THEN A PLONKER LIKE NICK CLEGGS SAY'S "THEY CAN DO WITHOUT, WE'LL TAKE IT OFF THEM".

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Nigel gardiner

Dec 05, 2011 at 17:49

Just how did Clegg amass his wealth I wonder as he is purported to be a millionaire, he,s an idiot so surely it wasnt by hard work

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john humphries

Dec 05, 2011 at 17:49

For some reason, I've got this image in my head of politicians at Cabinet level, going to a fairground, where they take turns at the 'shoot the ducks' stall.

The ducks have nowhere to go, but round and round the mechanical treadmill, where they are targets for the air-rifle toting Ministers.

The ducks can't respond; can't be heard; can't be helped; can't avoid the constant barrage of little lead pot-shots. Oh, and 99% of the ducks are very tired, hard worked, old-fashioned ducks who did their best to provide for their later days on the social treadmill.

Seems a silly image, but I can't shake it out of my silly old brain.

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barry watson

Dec 05, 2011 at 17:51

you just cant get your breath can you,means test bus passes for goodness sake.

has clegg completely lost the plot, has he nothing better to think about

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Raymond Davenport

Dec 05, 2011 at 17:52

Still trying to reach out of touch ARM Investors, please visit http://arminvestors.com/armforum/index.php. We was all going to donate our 'bus passes but thanks to FSA we shall now very likely need them.

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Hilary hames

Dec 05, 2011 at 18:01

William Thomson

Next year consider getting your senior railcard from your local authority - I dont know if all of them offer the same discount but I paid £20.50.

Btw,anyone who wants to use their Tesco points instead can get their card for £14 worth of points.

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MICHAEL HARRIS

Dec 05, 2011 at 18:02

Another case of the left hand not knowing what the right hand is doing. We have been told ad nauseam to use public transport for green reasons. Now they propose to effectively tax that same transport.

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cc

Dec 05, 2011 at 18:02

Yes John, I certainly feel like a duck... its a bit like the old running in treacle nightmare.

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john humphries

Dec 05, 2011 at 18:04

# Nigel gardiner...... £??

For a start, look to his in-laws.

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White Stick follower

Dec 05, 2011 at 18:05

Clegg has yet again demonstrated that he lives in a cloistered world, totally detached from reality. Whether any of his ideas have any merit is a matter for the electorate to decide, but like most politicians he'll forget those poor souls totally-- until the next election is imminent. Otherwise, as far as I can see he is a waste of space- and as for financial matters, I believe that he is purported to be from a wealthy family and not short of a few thousand ponds here or there, so if he wants to join the wealthy who sponsored this initiative he won't notice any financial difference, because he gets none of these benefits and wouldn't miss them if he did.

He ignores the 'Silver Vote' at his peril.

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Roger Bailey

Dec 05, 2011 at 18:25

Means testing. I wonder how Clegg even came to know of the words. This is definitely not the answer and he obviously hasn't a clue just how laborious it is to maintain financial records in order to fill in the necessary application forms accurately. It wouild be beyond the capabilites of many pensioners over 75 , many of whom do not even claim other means tested benefits such as pension top ups.If the government really is so hard up raise the age of issue to the mens pension age.I applied for mine at 60 and have used it about three times over almost 6 years.Mainly the pensioners who use it are the ones that need to i.e. older/poorer ones who do not have a car at their disposal.

In my view , means testing of pensioners should be abolished together with means testing for Student Loans. I hate to think just how much this costs to administer let alone how many weeks of peoples lives are also wasted. Increase the state pension for everyone and stop any furher government subsidies to public sector pensions and private pensions tax reliefs. Simplify things, not make things ever more complicated, that's the sensible way to go..

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Anonymous 1 needed this 'off the record'

Dec 05, 2011 at 18:25

Nick Clegg does not seem to know that pensioners are already taxed at 50% on any income over the maximum Age Allowance income of £24000 actually £2000 lless than the average wage. How's that for fairness !

Mr. Clegg should check his facts before making any statement about anything - his record so far has been pretty poor.

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Keith Phillips

Dec 05, 2011 at 18:27

I have never understood why all benefits, not just for pensioners, are not treated as income, after all that is exactly what they are. They would then be taxed as for other income, so that those who do not really need the benefit, ie winter heating allowance, would be taxed and those who really need it would be under the tax threshold and would have if in full. At least, then the Treasury would be able to recoup some of the benefit.

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Christopher Carter

Dec 05, 2011 at 18:43

What does it matter where money comes from except politically. Since there is little to lose for the government politically, why don't they go on a simplifying spree scrapping all benefits (including ISAs) and adjusting pensions and taxation accordingly. CGT threshold could stay, but there are some ISA millionaires. How fair is that?

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gggggg hjhjkl;'

Dec 05, 2011 at 19:00

I agree with those above who point out "that the politicians ignore the grey vote at their peril". The politicians (apart from Nick Clegg) understand this very well. The press still appear NOT to have go the message

The Chancellor raised the basic state pension by CPI at September. This was done without introducing the averaging CPI formular that had been so widely muted, "do not mess with the grey vote" was well understood by him.

During my working life I received NO benefits from the welfare state, even though I had paid for them throughou, therefore I have no "guilt" about receiving te benefits of the bus pass and the Winter Fuel Allowance.

Anyone who attempts to change these will reap the "whirl wind" at the next election, mark my words.

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norastrand

Dec 05, 2011 at 19:07

Yes , Lets mean test the MPs , the royal family , Its always the ordinary bloke in the street , perhaps because its so simple to do . Is Mick Clegg real , he sold himself and his party for a ride in a limo !! , come on Nicholas where are your principles , with the toilet paper no doubt !!

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Sally Bhimani

Dec 05, 2011 at 19:34

Bus passes are almost self-regulating according to income - the rich rarely use or even apply, those with modest income use less often such as when they have the time to be eco-friendly or the cost of parking for several hours becomes prohibitive, & those with low income use most frequently for essential shopping, and more importantly, to maintain a relatively free social life without having to worry whether they can afford it.

Saying the pensioners are getting an increase related to RPI is incorrect - that applies only to the basic part of the pension: many of us have worked years longer to enhance our pension, only to find the increase is only on part of it (in my case, on 50% of it)

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Nick-

Dec 05, 2011 at 20:27

I have just read that Barclays will pay £5 billion to investment bankers despite calls for restraint from Bank of England. I have also read that there are 14 countries now world wide have served a special levy on banks which helps to pay their debt. After all, it was the banks responsible for the recession we are facing today. The present government have said we are all-in-it together, so why us the pensioners, the most powerless of all are targeted by the Liberal Democrats.

Nick Clegg should focus on greedy bankers, chief executives, politicians and even on ex Prime Ministers now millionaires claiming millions for travelling expenses, but of course to do that, would need courage and valour.

Further more, what will hapen to the VAT paid on the extra heating cost?

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Hesi

Dec 05, 2011 at 22:58

While we are having a go at everybody who receives anything perhaps the journalists at Citywire might like to suggest how those with mortgages subsidised by artificilaly low interest rates might like to contribute to this conscience tweaking. Indeed it is pensioners who have seen their income from savings fall more than 50% (yes 50%). I thought we were all in this together?

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alangb

Dec 06, 2011 at 00:55

Nick Clegg should focus on MP's pensions.

They should put their own House of Commons in order before attacking the rest of the pensioner community.

Why should an MP get a full 66% pension after 20 years as an MP when the rest of us have to work for 40 years?

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stuart parrott

Dec 06, 2011 at 01:57

If I were a Liberal Democrat member, I would be writing to Party HQ to say please, please, dump this greatest of political clowns, Clegg, before he consigns his party, his few MPs, and a thousand Lib-Dem councillors, to the ash heap of history. We the thirteen million "grey" voters , pensioners who have worked hard all our lives, will remember what Clegg said at the next election about minor fringe benefits like bus passes and winter fuel allowances: the Lib-Dems will suffer from the ill-considered remarks of this foolish millionaire toff, yet another in the long line of oily opportunist chancers, out-of-touch, overpaid and infinitely smug, who have occupied what used to be the mother of parliaments: Blair, Harman, Balls, Cooper, Cameron, Clegg, few of them as far as I can see have ever done a proper job, are just a bunch of sanctimonious and self-admiring Oxbridge career politicians who in their infinite self-regard presume to deliver self-righteous lectures to a United Kingdom they don't understand. The only politicians I can see of any weight or substance are William Hague, Duncan Smith and, a bright light in a sea of mediocrity, Nigel Farrage

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jamnor via mobile

Dec 06, 2011 at 08:31

This is a typical piecemeal idea that will only generate huge administrative costs and gain nothing. Many pensioners do not use their bus pass because they are not sufficiently well enough to do so. It nevertheless counts for a lot to know you have that entitlement. When pensioners face huge uncertainty over the scandalous state of care in old age in England anyway, and the same cost of living increases as the rest of us, it seems a bus pass is a small token of dignity. If the government is serious about cutting spending, it should start with the jobs for the boys public sector executives who currently are paid about 4 times more than they need to be, and their crony schemes. To start means testing pensioners, the cronies would need a new executive role 'means test gauleiter' created, with an entire empire of staff around them. This would of course mirror all the others, e.g. the one that harass pensioners over their disabled parkingspaces. Most pensioners live modestly, there is already a huge amount of means testing generating mountains of adminstrative overhead, when studies have shown a universal pension for all is cheapest overall. This is another really bad idea from politicians so far removed from the real world.

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Peter Young Engineer

Dec 06, 2011 at 08:38

I'm not sure how the Bus Pass works, even though I have one.

Bus Pass

Is it a fixed amount the Government pays or it it just the cost of the actual trips made. I've always assumed the latter but perhaps I'm wrong.

I've had mine a year but not used it yet as I am still working.

Anyway I think the Bus Pass serves us well, as someone said retired folks are generally using it during the daytime, whenever I've used our local bus to go into town (paying the fare, pre having a pass) it has been pretty full of pensioners, most of whom would have no other way of travelling. The driver records your pass when you get on (this is why I think it is paid per trip).

Take it away or change the way it works, pensioner travel will reduce and we will lose the remaining buses as it will be totally uneconomic to run them.

Nick Clegg is a total pratt!!!

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xxxxx

Dec 06, 2011 at 09:52

So let me get this right.

Most pensioners have a low income. Because of this we provide them with various universal benefits to make sure they can get out and about to lead fulfilled lives, to make sure they don't freeze to death (though not in all cases) and to provide some entertainment while at home (free TV licence).

This costs us a lot of money - £16 billion a year.

These are difficult financial times and we need to save money. Let's stop those who are well off, a comparitively small number of people from having these benefits. We will do this by means testing EVERYONE who is a pensioner.

It doesn't sound very logical. The net saving looks as if it would be small for the amount of effort by everyone. The sad fact is it is likely to be large. Nick Clegg knows only too well that as soon as you means test benefits pensioners are reluctant to claim them. Those in need will not claim and more will die from the cold but politicians can say they need not because the benefits are available. It sort of gives you an insight into the real Nick Clegg, the millionaire with millionaire friends.

For those who think the answer is to tax these benefits then I only say God help us because HMRC has an extremely poor track record in getting pensioners' tax correct. Just check out all the press articles over the years.

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Anonymous 2 needed this 'off the record'

Dec 06, 2011 at 09:52

A few rich people celebrities want publicity and so decide that for £200 they can display to their fictitious adoring general public that they are generous and benevolent to the needy whilst at the same time give the impression that those who don’t fall in line are lousy mean spirited people which the government should do something about.

Disposable income is that money which is available after taxes and so a pensioner on pension credit, should have added to his income notional monies for free rates, rental, dentistry as well as winter fuel payment, cold weather payments, allowances given by fuel providers and so on. So please identify which pensioners are in fuel poverty.

Some ex MPs probably derive income of £40,000pa from their pension scheme, will Nick, the betrayer of students, include this worthless lot of retiree’s in his millionaire list?

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David Lewis

Dec 06, 2011 at 11:28

Dear Mr Clegg

I gather that you think we who are older should have some of our ‘benefits’ such as free travel taken away so we “share the sacrifice required to balance the books”. Has it not occurred to you that we have already made that sacrifice? We have worked hard all our lives and built the country up from the devastating low that followed World War II. Throughout our working lives we have paid very substantial taxes and National Insurance. We have saved for our own pensions. Our contributions have paid for the pensions and care of the previous generation who had not made such provisions because of war service – in other words we acted as a community.

How have successive governments, including yours reacted? They have raided large swathes of our company pensions leaving us much worse off than was promised. The have pared away our state pensions, which I do not regard as a benefit but a right for which I have paid. They have broken the social contract that in exchange for contributions to the National Insurance Fund we would get free care in our old age. We, who handed on to your generation a country in good working order have not been thanked, we have been told we are a problem. You have taken money that should have been used to pay your dues to us and squandered it on other things, EU Bureaucracies, Overseas Aid for political reasons, Green Agendas that are nonsensical.

Mr Clegg, you were not elected to government in the last election, you sneaked into a supporting role by a chance of the electoral system. You have no mandate to thrust your distorted ideas upon us. You did nothing effective when a minority party in opposition to stop what the Labour Government did, you had no forward looking ideas and you still don’t. It is time to dig out your sandals and sweater and go back to leading the Liberal Party as a fringe novelty party. Oh, and please stop referring to the few things we are getting back from the state as perks or benefits. We have paid for these things and they are our right. Your job is to stop the wastage of resources in Europe, to reign in the idiotic spending on green matters and to ignite the bonfire of regulations and quangos that was promised and has never materialised. Not to steal even more from those who have already paid handsomely for that which you are now squandering. So far we have seen no evidence that you are up to the job. Were you on a bonus scheme, you would not be getting one.

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White Stick follower

Dec 06, 2011 at 12:05

Mr.Clegg does not have a bus pass, of course, because he's not old enough, so I wonder what he knows about using busses. Maybe there are plenty in Sheffield, and London is full of them, but where I live there are two per day ,which run on a schedule which is accuraet to + or- 20 minutes, (or perhaps doesn't come at all) to & from the town centre- that is the centre full of empty shops, Charity shops, travel agents, Estate Agents,hairdressers and coffee houses, none of which one has much need of.

Yes I have a bus pass, and I used it once 4 or 5 years ago, when I had to go to London and the Tubes were on strike.

However, the Bus Pass is very useful- as an Identity Card. It seems to rank with a Passport and Driving Licence in many finacial establishments.

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Peter Young Engineer

Dec 06, 2011 at 12:38

@ Dave Lewis:

You stated all my thoughts very eloquently, I retire in March on a reduced pension thanks to Gordon Brown et al.

It should be a mandatory qualification for an MP to have run a business for 20 years before being allowed to stand for Parliament.

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Nigel gardiner

Dec 06, 2011 at 13:47

Thank you David Lewis, well explained I think. I shall be going to see my local MP this month to pin his ears back to the wall about sevral things,and I shall pop your statement in my folder

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Alan's opinion via mobile

Dec 06, 2011 at 17:34

Well, we have had some excellent posts here; Stuart Parrott and David Lewis, particularly, and many others.

Almost unanimously, Clegg is identified for the un-elected naive moron that he is and his attempt at theft of rightful entitlements to deserving citizens is clearly exposed. Well done to those perceptive commentators!

I am quite certain he will be consigned to history at the next election and his political career will hopefully be over for good. Unfortunately, for taxpayers it will mean going on to have to pay for his bloated pension and allowances for many years to come - unless, of course, he chooses not to take them on principle ... fat chance of that!

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SSJ

Dec 07, 2011 at 14:22

You're all missing the benefits of introducing means-testing....we could create many thousands of civil service jobs to administer the scheme. That way, we reduce unemployment, saving expenditure on their unemployment benefits and gaining from their income tax payments. What's not to like?! Logically, we should means-test even more things - that way we could end up with a booming economy to rival China's!

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Roger Bailey

Dec 07, 2011 at 18:18

The new Citizens Pension proposed does not mean that means testing will be abolished. The buck will be passed to the Councils who will have to means test all pensioners who are eligible for claiming Housing and Council Tax benefits. They propose that only pensioners reachng pension age in 2015 will receive this new pension and that the current system will continue running alongside it until the last person dies. So not simplifying things, just creating uneccessary work.

There is a simple solution to this. Notionally credit every pensioner with the amount proposed for the Citizens pension and increase annually by CPI. In addition notionally credit all pensioners with Housing Benefit and Council Tax benefiit as they already calculate and adjust annually by an index which reflects the increase/decrease of Housing cost and Council Tax Let's assume that these figures are 140pw for the Citizens Pension and 120pw for the Housing Benefit. They already propose increasing personal allowance tp £12500 p.a, the new pension would be £13520 and 40 hours at the minmum wage would be £12646 so why not allign them all at the higher rate of £13520 for personal allowances so that those working on the minimum wage and all pensioners on this basic pension receive their income tax free.

On the basis that pensioners should be no worse off than they would be under the current system the difference between what they would receive under the old system and the new Citzens system can be clawed back up to this amount of this difference by deducting up to this amount from the Citizens Pension .

The portion of another pension that relates to their own personal contrbutions should be disregarded. and would be taxed as it currently is, as would the remainder of the state/private pension funded by the State or their employers that has not been clawed back.

Under current arrangements, married couples and co-habitees of either gender receive less Housing \beneifit than as individuals so the difference should also be clawed back in the same way.. As of the date of introduction, NIC shouild be abolished and tax rates adjusted to compensate for the loss of this income to the exchequer. 30 years of NIC contributions would entitle a pensioner to the full pension as it does now but in the future, years of Nic payments should be replaced by years of residence.

Existing subsidised pensions should also be abolished and employers or State contributions should be added to salaries so that they are taxed in the normal way. All tax reliefs on pension contrbutions should be withdrawn so that all persons can invest in say ISA's rather than pensions. These reliefs only benefit the higher rate taxpayer anyway.

So what do these suggestions achieve.

A reasonable pension for everyone who has either paid NIc's or been resident for 30 years.(excluding years of residence when NIC's could have been paid)

Abolition of means testing for pensioner with huge cost savings.

Abolition of NIC's nd the cost of administering these.

A reduction in Council Tax as Councils would no longer have the same amount of work to do to administer housing benefits.

37 billion of extra income from abolition of pensions tax reliiefs.

For those who can save or want to save, full access to all their savings some of which can be saved in tax free ISA's

Force high earners to pay tax on all their income rather than avoid thisby paying into pensions with much too generous contribution limits.

Allow low income pensioners to receive all the benefits that many previously did not claim for

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