Has the SNP just changed its pension policy?
I've blogged on pensions time and time again, but in all cases when it came to dealing with the SNP and pensions it was dog whistle politics, innuendo or sleight of hand.
After all it would be difficult to pin anyone in the SNP actually saying that the UK would fund Scottish pensions in the event of independence. Sure there was a lot of pointing to a letter that turned out to be wrong and a casual nod towards Steve Webb's evidence to the Scottish Affairs Select Committee all designed to give the impression that the UK might fund pensions without actually saying it.
The SNP are clever that way.
There is a reason they were never explicit of course.
The continuing UK wouldn't fund pensions in an independent Scotland. Both sides agreed on this.
Let me say that again.
Both sides agreed on this. The SNP's own paper on pensions and their white paper were explicit on it. Therefore for the SNP to state that cUK would be funding pensions for Scots would be a huge issue and a remarkable change in policy with huge repercussions.
Enter Dr Whitford
That all changed today when Dr Phillipa Whitford wrote to a constituent (Martin McFarlane) on the subject. In his letter he challenged Whitford's recent use of the zombie DWP letter and provided her with an extract from the White Paper which stated that the Scottish Government was responsible for all pensions of those living in Scotland and my FOI letter.
Rather than give the innuendo and dog whistle approach, a potentially cornered Whitford came out with what can only charitably be described as a rewriting of history or possibly a dramatic change in SNP policy. Below I quote the letter my own commentary on it. "The UK Pensions Minister Steven Webb was quite open when giving evidence to the Work and Pensions Committee" Not a good start it's Steve Webb and it was to the Scottish Affairs Select Committee - none of this is that important but it does show that this was not a well thought through reply. "... that the UK would have to fund pensions of those already retired and with accumulated pensions rights after paying in National Insurance over many years." Steve Webb said exactly the opposite if this. Time after Time at the committee it was clarified that Webb was not talking about the funding of pensions. The very article that Whitford cites in her reply also highlights that the question of payment (that is funding of pensions) was not resolved at the committee ("The question is, who is paying for it, and how is that [cost] split?")
So the idea that the UK stated that it would be paying and funding Scots pensions is a complete fabrication by Whitford.
It get's worse. In Webb's follow up written evidence he was explicit that cUK would expect an independent Scottish Government to fund Scots pensions including those already in payment. This isn't Whitford making a casual mistake, she is explicitly stating something that was not said in the committee and was explicitly contradicted by Webb himself.
"This is normal practice and there are many mobile workers who have proportions of their Pensions from more than one country. As, he pointed out, where you live or what citizenship you hold is not relevant, just as or those pensioners who currently live in France or Spain." What normal practice is there for pension liability allocation on the secession of a state? The only case we have is the UK and Eire splitting up and there Eire took on the liability for existing pensions.
Whitford is attempting to deliberately confuse the issue of people moving country after retirement and the break up of a state. Let's be clear here, the "normal practice" in these circumstances as set out by Whitford's own party in their "White Paper' and 'Pensions In an Independent Scotland" publications was that the responsibility for all pensions (including those currently in payment) for all Scottish residents at the point of independence would fall on the Scottish Government and not the continuing UK.
So not only do we have Whitford making up what the UK government said we also have her explicitly contradicting her own party's proposals on the subject. Something she was explicitly aware of when replying as Martin McFarlane provided her with an extract of the SNP. So the real question here is do we have a new pension policy?
"Going forward, of course, a growing proportion of each younger person's pension would be paid to and due from a future Scottish Government"
This gives us no doubt about Whitford's intentions and meaning here. Her case is that an independent Scotland would only be responsible for new pensions rights accrued from the date of independence with existing rights paid for by the continuing UK. Again both the SNP and the UK agreed explicitly that this was not the case. Whitford is therefore asserting a set of facts that do not exist or creating a new SNP policy.
"It was proposed that there would likely come a cut off point from where, the UK would transfer a negotiated sum to cover their liability and the pensions would then become the responsibility of the Scottish Government"
Now this is interesting because it's entirely new.
What exactly was proposed?
When was this proposed?
The SNP never proposed it in any official publication that I'm aware of (and I've been through them over and over again). So do we have a senior frontbench SNP MP making up a proposal that did not exist? Furthermore what negotiated sum would there be for a liability that has no backing assets. Pensions are a transfer payment, they are paid for out of current taxation and not from a pot. Again, let me be clear here, (and I make no apology for repetition) Whitford is contradicting existing SNP policy or announcing a new policy. "All of that transition would be negotiated but it is misleading to suggest that the UK would or could walk away from their liability for Pension for which they have received a citizen's National Insurance contributions for 30-40 years." It's a mark of how much Whitford is winging it here that she now contradicts herself. At the start of the letter she recognised that citizenship is irrelevant, now she invokes citizenship incorrectly. The continuing UK would not be walking away from a liability, the liability (for current and future pensions) would fall with the Scottish Government for all Scottish residents as the SNP proposed and as agreed by Steve Webb in his written evidence. There is no legal entitlement to a pension from the UK state as has been demonstrated within the European Court. It's quite clear the only person being misleading here is Whitford. "All of these issues are being considered by the Growth Commission and will again be aired in any future debate. However there are international norms and it would be very unlikely that the UK would default on paying the pension entitlements to people (sic) have paid their National Insurance contributions" All fascinating stuff.
Is this now a statement that the Growth Commission have abandoned the SNP's previous position on pensions and are saying that pensions will be paid by the continuing UK?
If they do that will be a remarkable state of affairs and will leave many Scottish pensioners worried about their existing pensions, because with the UK on the record as stating existing pensions will depend on the ability of the Scottish Government to fund its obligations it would mean their pensions would stop on independence. There are no international norms when it comes to allocating pensions between states (other than Eire). Furthermore the UK government agreeing with the Scottish Government position that they take on the liability for all current and future Scottish pensions is not a default (again something that has been established in law). Therefore this letter begs a number of questions: Is this a new SNP policy on pensions from a senior SNP front bencher? Is the Growth Commission standing behind the policy as set out in this letter? Why has Whiteford specifically mislead Mr McFarlane by stating facts which did not exist with respect to Steve Webb's evidence? Is Whiteford badly misinformed, lying or setting out a new policy on pensions? If the SNP has changed its position on pensions should Scottish pensioners now be worried about their state pension after independence?
Let me say that again.
Both sides agreed on this. The SNP's own paper on pensions and their white paper were explicit on it. Therefore for the SNP to state that cUK would be funding pensions for Scots would be a huge issue and a remarkable change in policy with huge repercussions.
Enter Dr Whitford
That all changed today when Dr Phillipa Whitford wrote to a constituent (Martin McFarlane) on the subject. In his letter he challenged Whitford's recent use of the zombie DWP letter and provided her with an extract from the White Paper which stated that the Scottish Government was responsible for all pensions of those living in Scotland and my FOI letter. Rather than give the innuendo and dog whistle approach, a potentially cornered Whitford came out with what can only charitably be described as a rewriting of history or possibly a dramatic change in SNP policy. Below I quote the letter my own commentary on it. "The UK Pensions Minister Steven Webb was quite open when giving evidence to the Work and Pensions Committee" Not a good start it's Steve Webb and it was to the Scottish Affairs Select Committee - none of this is that important but it does show that this was not a well thought through reply. "... that the UK would have to fund pensions of those already retired and with accumulated pensions rights after paying in National Insurance over many years." Steve Webb said exactly the opposite if this. Time after Time at the committee it was clarified that Webb was not talking about the funding of pensions. The very article that Whitford cites in her reply also highlights that the question of payment (that is funding of pensions) was not resolved at the committee ("The question is, who is paying for it, and how is that [cost] split?")
So the idea that the UK stated that it would be paying and funding Scots pensions is a complete fabrication by Whitford.
It get's worse. In Webb's follow up written evidence he was explicit that cUK would expect an independent Scottish Government to fund Scots pensions including those already in payment. This isn't Whitford making a casual mistake, she is explicitly stating something that was not said in the committee and was explicitly contradicted by Webb himself.
"This is normal practice and there are many mobile workers who have proportions of their Pensions from more than one country. As, he pointed out, where you live or what citizenship you hold is not relevant, just as or those pensioners who currently live in France or Spain." What normal practice is there for pension liability allocation on the secession of a state? The only case we have is the UK and Eire splitting up and there Eire took on the liability for existing pensions.
Whitford is attempting to deliberately confuse the issue of people moving country after retirement and the break up of a state. Let's be clear here, the "normal practice" in these circumstances as set out by Whitford's own party in their "White Paper' and 'Pensions In an Independent Scotland" publications was that the responsibility for all pensions (including those currently in payment) for all Scottish residents at the point of independence would fall on the Scottish Government and not the continuing UK.
So not only do we have Whitford making up what the UK government said we also have her explicitly contradicting her own party's proposals on the subject. Something she was explicitly aware of when replying as Martin McFarlane provided her with an extract of the SNP. So the real question here is do we have a new pension policy?
"Going forward, of course, a growing proportion of each younger person's pension would be paid to and due from a future Scottish Government"
This gives us no doubt about Whitford's intentions and meaning here. Her case is that an independent Scotland would only be responsible for new pensions rights accrued from the date of independence with existing rights paid for by the continuing UK. Again both the SNP and the UK agreed explicitly that this was not the case. Whitford is therefore asserting a set of facts that do not exist or creating a new SNP policy.
"It was proposed that there would likely come a cut off point from where, the UK would transfer a negotiated sum to cover their liability and the pensions would then become the responsibility of the Scottish Government"
Now this is interesting because it's entirely new. What exactly was proposed?
When was this proposed?
The SNP never proposed it in any official publication that I'm aware of (and I've been through them over and over again). So do we have a senior frontbench SNP MP making up a proposal that did not exist? Furthermore what negotiated sum would there be for a liability that has no backing assets. Pensions are a transfer payment, they are paid for out of current taxation and not from a pot. Again, let me be clear here, (and I make no apology for repetition) Whitford is contradicting existing SNP policy or announcing a new policy. "All of that transition would be negotiated but it is misleading to suggest that the UK would or could walk away from their liability for Pension for which they have received a citizen's National Insurance contributions for 30-40 years." It's a mark of how much Whitford is winging it here that she now contradicts herself. At the start of the letter she recognised that citizenship is irrelevant, now she invokes citizenship incorrectly. The continuing UK would not be walking away from a liability, the liability (for current and future pensions) would fall with the Scottish Government for all Scottish residents as the SNP proposed and as agreed by Steve Webb in his written evidence. There is no legal entitlement to a pension from the UK state as has been demonstrated within the European Court. It's quite clear the only person being misleading here is Whitford. "All of these issues are being considered by the Growth Commission and will again be aired in any future debate. However there are international norms and it would be very unlikely that the UK would default on paying the pension entitlements to people (sic) have paid their National Insurance contributions" All fascinating stuff.
Is this now a statement that the Growth Commission have abandoned the SNP's previous position on pensions and are saying that pensions will be paid by the continuing UK?
If they do that will be a remarkable state of affairs and will leave many Scottish pensioners worried about their existing pensions, because with the UK on the record as stating existing pensions will depend on the ability of the Scottish Government to fund its obligations it would mean their pensions would stop on independence. There are no international norms when it comes to allocating pensions between states (other than Eire). Furthermore the UK government agreeing with the Scottish Government position that they take on the liability for all current and future Scottish pensions is not a default (again something that has been established in law). Therefore this letter begs a number of questions: Is this a new SNP policy on pensions from a senior SNP front bencher? Is the Growth Commission standing behind the policy as set out in this letter? Why has Whiteford specifically mislead Mr McFarlane by stating facts which did not exist with respect to Steve Webb's evidence? Is Whiteford badly misinformed, lying or setting out a new policy on pensions? If the SNP has changed its position on pensions should Scottish pensioners now be worried about their state pension after independence?
I have rarely come across a more convoluted, painfully confused and intellectually stunted attempt to muddy what is a perfectly clear position. The UK is liable to provide a pension to people who have made the appropriate contributions, wherever they live. To pretend other is simply dishonest.
ReplyDeleteIt may be the case that the an iScot would agree to take administrative responsibility for payment of these pensions as an agent of the rUK. It may be the case that a future iScot would, in the context of a negotiated settlement, agree to take financial responsibility for such pensions in respect of an agreed transfer of funds or asset.
However, in the absence of any such agreement, the rUK will continue have a continuing legal liability for the payment of these pensions. To pretend otherwise is to put forward the contention that the UK would carry out their legal pension responsibilities everywhere else in the globe EXCEPT in Scotland - which is an absurdity. But then, absurd propositions seem to come easily to you.
Joseph,
DeleteWhat you just said is in direct contradiction to the Scottish government's position. As for your legal liability point I've already proved that is wrong. It would be helpful if you actually read the blog before posting your comment, it would save you looking confused and muddled.
The EXCEPT Scotland point is wrong people from cUK who retired to Scotland after independence would still get a cUK pension. Again you are attempting to confuse two different issues. I get that, I know why you need to do that as it's difficult to face the fact that the Yes campaign led you to the garden path on this.
Hey Neil
DeleteFriday next week looks like a meeting on Radio 4 between a guy that seems pretty good with figures and another guy that 'thinks' he's pretty good with figures, to talk about GERS. This maybe a pretty good time to ask your pal Kev if he could bring up this pension myth you've adopted at the same time in order for both of these Unionist scare tactics could be debunked simultaneously live on air, whatcha think?
Neil,
DeleteYou had a long debate with Mike F following your blog on 18th Nov 2016 regarding the responsibility for pension payments in iScot. A separate blog with the arguements put forward in that conversation would be really helpful in putting this debate to bed.
http://rwbblog.blogspot.co.uk/2016/11/gers-beyond-laser-engineer.html?m=1
Dointhebiz 1 - It's Radio Scotland and given how little Murphy was able to produce a genuine critique of GERS I doubt he's be able to understand pensions, even where both the SNP and the UK governments agree on the subject.
DeleteYes Gordon, fair point. This idea that the cUK would be paying for Scots pensions ignores the fact that Scotland would also have to pay for cUK pensions which creates no net value at all.
DeleteScotland currently pays it's pension liabilities and would continue to pay it's pensions liabilities.
ReplyDeleteThere is an already accrued calculation to be done but that is dependent on UK reconciliation periods.
There is no mystery or slight of hand in any position I've heard or read that counters this position.
Ian you'd have a point if even one party to this debate actually agreed with you. Both sides agree on this topic and it you thought about it this is the only logical outcome for both sides.
DeleteState pensions are not paid from a pot that the individual accrues. Today's pensioners are paid by today's workers. They in turn get their pensions paid by tomorrow's workers and so it goes on.
ReplyDeleteIt's very unlikely that r.uk taxpayers will pay for pensions in an independent Scotland.
A country needs a strong economy to support pensions and benefits
You can nit pick till your heart's content about SNP pension policy but the fact is we are already part of the UK triple lock pension pish and we are already being screwed. I will now have to work till I'm 68 for my pension. You speak to waspi women about pensions and they'll cure you of your penchant for being pedantic with pensions. ScotGov have a little time to formulate their policies for an independent Scotland, no? UKgov? We'll they've had centuries to get it right and you'd think pensions would be a basic, yes? Not so for our esteemed UKGov.
ReplyDeleteI'd say the onus is on the Union and unionists to start PROVING their positive case for the union. Let Scotland actually see ALL of the relevant data required. So that both you and I can make an informed decision.
Get FACTS; start asking WM to back up your arguments RE finances & GERS. No more estimates or fiddling the books. You can only forecast future income with factual data. That, you don't have. Get it. Remember, don't Scottish Gov have a legal obligation to balance books? They've already got a proven track record. Let's check that against the UKGov. Hmmmm they've got form. They're pretty shit at running economies but fantastic at lining their own pockets.
Perhaps you have vested interests in the union (which means you're selfish) or you are afraid (which means you need courage). One thing is for absolute certain. If you feel more British than Scottish then you're NOT a proud Scot. You're not a Scot at all. If you deny Scotland self determination, you. are. not. Scottish.
An immigrant who has come here, choosing Scotland as his home and who wants to help Scotland choose her future is a new Scot.Remember that.
So pensions? Oh they'll be paid and we'll know by whom, once it's been negotiated, though I'd say you've more to deal with now. Wouldn't you?
For a start the SNP could change the UK pension right now under their top up powers so perhaps you might want to take up the issue with them as well? Or is this SNP Good?
DeleteProving the positive case for the union?
UK single market (our biggest market) single UK currency that is the "best for Scotland" as Salmond says himself, £9bn fiscal transfer from UK, pooling and sharing on welfare which is so strong that you seemingly want to keep it after independence.
The GERS facts are produced by the Scottish Government and they have never been refused a request for information from Westminster - see the FOI on this blog.
Perhaps I am simply asking a few questions and not getting straight answers? Give me a real costed plan for independence, explain how the UK single market would continue and tell me what the currency is and I'll engage. Until then you are just plating the man and I'm just as much a Scot as you or anyone else.
Pensions yes they will be paid, by the Scottish Government. both sides agree on this.
Neil
ReplyDeleteAre you suggesting that UK gvt simply ignores any notional accrual of Scots if they went Indy?
No not at all, the accrual is spit between the cUK and an independent Scotland on a residency basis as per the Scottish governments statements on this.
DeleteSo your assertion is that a newly independent Scotland would be required to pay the state pension of all those Scots entitled to it from day one of Independence? The fact that these people have paid their NI contributions for the previous 50 years to the UK treasury is in your opinion irrelevant. The UK in effect walks away Scot free because there is no "pension pot" as it is all paid from last weeks NI payments? I'm actually astonished you expect anyone to believe such utter drivel. If that were the case (which it isn't) I would expect any Scottish negotiator sitting down with representatives of the rUK to tell them that Scotland will not be talking on a per capita share of the UK debt.
ReplyDeleteTwo can play at that game!
Silver Surfer - it's generally a good idea to read the blog before posting. If you had you would realise that it's not my assertion. This is the position of the SNP Scottish Government. Let me say that again, its the position of the SNP Scottish Government that all pensions in Scotland including the associated payments become their responsibility after independence. The UK agree with them on that issue. There is nothing of substance to negotiate here. if you think that the Scottish government is talking utter drivel then take it up with the SNP. However they are taking the only logically available position.
DeleteThe UK isnt walking away Scot free, it's been paying Scottish pensions from UK taxation since pensions were invented. Post independence it will receive cUK taxation and pay cUK pensions, just as Scotland shall receive iScotland taxes and pay iScot pensions.
Finally debt isnt optional, if you'd read this blog you would know that, but it seems you just post up comments without actually reading.
Of course "all pensions in Scotland including the associated payments" become the responsibility of the Scottish Government after independence, I doubt there is anyone who will disagree with either you or them on that score. What many do disagree with is "your assertion" that there will be no fiscal transfer to the Scottish government from the rUK for the decades of NI contributions made by Scots workers while citizens of the UK. You mention Steve Webb's letter in which he backtracks on his evidence given to the Scottish Affairs Select Committee in Westminster during which he stated:-
Delete"At the moment the only thing that determines how much pension you get is how much NI contributions you've paid in. So you don't have to be British to get a British pension. If you pay British NI and you satisfy the minimum contribution rules you get a pension from the UK government whether you're a UK citizen or not".
Under further questioning from the chair (Ian Davidson, Labour) Webb said " Where you end up isn't material because you've paid into the system" he continued, "people have built up a right in respect of service for as long as they have been paying into the UK system". He was basically stating that the responsibility for state pension provision for those Scots already retired prior to independence rests with the UK. There would then have to be negotiations to cover the "banked" contributions which every Scot under the age of 65 had paid into the NI system up to the point of independence.
So, to reiterate, the only thing the Scottish Government have done thus far is confirm they will take over the administration of Scottish state pensions once we are independent. That in no way implies they will supply the funds to service these pensions for which the UK has collected and banked deductions taken from every Scot during their working life, and we're not just talking about retiree's here. I would also expect negotiations to take place in order for a fiscal settlement to be made for all the contributions the UK treasury has had from those aged between 16 & 64, so contrary to your "assertions" there is plenty of substance to be negotiated here. But You at least got one thing right we can both agree on, the UK government won't be walking away Scot free.
They'll pay their dues just like Steve Webb said in his address to Westminster's Scottish Affairs Select Committee. But don't take my word for it, go watch the video on Parliament TV.
So you now agree that Scotland is going to be paying all pensions in Scotland. That's progress.
DeleteNow you seem to have moved on to a transfer of assets from the UK in respect of these payments. There are two major problems with this:
1 There are no assets in the NI fund they have been paid out directly to existing pensioners. Scottish NI payers (supplemented by rUK NI payers) have been funding Scottish Pensions since inception
So you now agree that Scotland is going to be paying all pensions in Scotland. That's progress.
Now you seem to have moved on to a transfer of assets from the UK in respect of these payments. There are two major problems with this:
1 There are no assets in the NI fund they have been paid out directly to existing pensioners. Scottish NI payers (supplemented by rUK NI payers) have been funding Scottish Pensions since inception.
2 If there is a call for a fiscal transfer from the cUK to Scotland in respect of contributions paid into the British system (of which Scotland is a part) then Scotland would also owe cUK a fiscal transfer in respect of the cUK pensioners that have earned their rights whilst Scotland was part of the UK. That would mean a money flow to Scotland from cUK for existing pensioners and second flow from Scotland to cUK in respect of it’s population share of existing UK pensioners. Guess what? At the end of that process Scotland loses out, that’s because Scottish NI as a proportion of UK NI is lower than our population share. This is exactly why the Scottish Government chose this route.
3 Its the only logical political route. After independence if the cUK decided to stop payments to Scots there is nothing the Scottish electorate could do about it, that would leave the Scottish Government carrying the can anyway.
You also say that the Scottish Government was only talking about administration? That’s not true as the white paper clearly states the Scottish Government is responsible for the payment, furthermore the finances section of the Scottish Government budget in the white paper take the full cost of pensions as being the sole burden of the Scottish Government.
If your assertion was correct there would be a significant saving in the budget. It’s not there. You are simply wrong.
You see I’m not making an assertion I’m making a point that is based on evidence. You on the other hand are just making points without any any evidence. Where for example is the statement of this expected transfer between cUK and an independent Scotland? If that was the case you would have expected the SNP to have set that out somewhere. Maybe in the white paper. Maybe in "Pensions In an independent Scotland”. But no, nothing not a sausage.
So all we have are your baseless assertions.
1/2
2/2
DeleteYou then go on to quote Steve Webb to the Scottish Affairs Select Committee.
As we can see you start by citing Webb and then discarding what he says when it comes to payment, arguing that he was backtracking.
A few more things:
1 I know Steve Webb, I’ve debated him in public, he knows his subject inside out and would not contradict himself.
2 If you even looked at little at this blog you would have seen I’ve covered that meeting in intricate detail - i refer to that in this article, which shows you are commenting on this without actually having read my piece. My other blog entry includes fully transcribing the session you are deliberately clipping from. You should probably go and read that before trying this line any more as you are just making a fool of yourself.
http://rwbblog.blogspot.co.uk/2017/01/the-fundamental-pensions-error-at-heart.html
3 Not only are you redacting the quotes you are expressly misquoting him, at no point did he say that the responsibility for Scots already returned prior to independence rests with the UK. You have literally made that up. If you are reduced to this sort of fiction, what possibly makes you think you have a case?
So to reiterate:
You are demonstrably wrong that it is administration only, the Scottish Government statements and budgets prove you wrong.
There is only one logical political and economic outcome that works and that is each political nation being responsible for its own resident’s benefits.
Even if you were right and there was to be a transfer of obligations between Scotland and cUK it would not work out in Scotland’s favour. If you remotely thought about this for a hew seconds you would realise this. However you are clearly so blinded by anger about the fact that it was the Yes campaign that lied on pensions it has stolen your objectivity.
Try to get it back before posting again you aren’t helping yourself.
I've never disputed that the Scottish government will take over the administration of Scottish pensions post independence. The issue here is still your ludicrous assertion that they will also fund the payments despite the London treasury having collected contributions from Scottish pay packets for decades. So,
Delete1. The fact there are no assets in the NI fund is clearly a) a prime example of Westminster's mismanagement of the state pension scheme, and b) not really Scotland's problem. Scots have paid in and as Webb pointed out, and provided they have banked enough contributions then they have earned the right to a full state pension from the UK. There is therefore no supplement (subsidy) required from rUK NI payers. That's just the same scaremongering Better Together nonsense that fooled many a pensioner in 2014. In effect: "ye cannae go independent as the English'll no top up yer pension". Gimme a break for God's sake!
2.That's just an expansion of the scaremongering drivel pointed out at 1.) above. Once again, provided a person has banked enough contributions in their own right then they are entitled to a full state pension on the day of their retiral. The money flow would be from Westminster not from English pensioners but nice try at muddying the waters to make it look like us poor Scots are eternally dependent on the largesse of our broad shouldered deep pocketed (but in reality...skint) chums to the South. I'll remember in future if ever get a request to top up my underfunded state pension contributions to inform the DWP not to worry about it as some anonymous Ni payer in England will supplement it as is their burden...according to you! On your last point about pensions being underfunded, other than Westminster mismanagement of the scheme how can it be underfunded when people pay in exactly what is required of them by the UK treasury. It's a personal contract between the individual and the government which guarantee's a state pension on retirement.
3.No it isn't the only logical political route as that will be mapped at the negotiating table prior to Scotland becoming an independent state, and there isn't a cat in hell's chance that the rUK (not cUK as that is open to question as well) would welsh on their obligations to Scotland as their standing in the international community would be trashed even beyond that which brexit will achieve.
The Scottish government claiming responsibility for the payment of Scottish pensions says nothing about them taking sole responsibility for the funding of them, particularly as it is clear that Westminster has a financial obligation towards those who have banked their contributions with the UK treasury. you are as usual trying to preempt what will clearly be a central plank of the negotiations between Scotland and the rUK. Your last paragraph is typical of the strawmen you resort to when scaremongering and empty assertions fail you.
Until such time as negotiations between both governments have been completed it's clear the baseless assertions are all yours.
1/2 To quote the opening line of your first comment?
Delete“So your assertion is that a newly independent Scotland would be required to pay the state pension of all those Scots entitled to it from day one of Independence?”
Now your first line.
“I’ve never disputed that the Scottish government will take over the administration of Scottish pensions post independence.”
So within 3 comments you are contradicting yourself and denying what you said. It’s a good illustration of your confusion. As I said your nationalism is blinding you.
So your case is now that cUK will fund the pensions of existing pensioners in Scotland.
I note that you have stopped quoting Webb in that respect, no acknowledgement of the fact that you deliberately misquoted him. I take it you now accept that Webb’s evidence was consistent. If it wasn’t consistent then please show how. But there is no doubt that when it comes to payment he is explicit, the UK will not be paying for Scottish pensions (including those in payment).
You’ve also decided to ignore the simple fact that the Scottish Government include the full cost of pensions in their white paper budget. Can you perhaps try to address that point rather than ignore it and hope it goes away.
I couldn’t agree more that under the UK system the method used is simple, pay your NI stamps and you earn credits to a pension from the UK. But if that is the case then Scotland as part of the UK has an obligation to meet those rights just as much as the cUK.
The trouble is you are assuming that the cUK pension system is the same as the former UK pension system. It’s not, the membership of that system has changed fundamentally. The former UK pension system has to be supported by its previous members (Scotland and cUK).
All this boils down to one simple fact, if cUK are responsible for former UK pensions then Scotland (as a member of the former UK) is also responsible for a population share of all those pensions.
That means (as you argue) a financial transfer from cUK to Scotland in respect of their share of the liabilities BUT also a transfer from Scotland to cUK in respect of their share of the liabilities. When you tot those transfers up (based on NI contributions and numbers of pensioners) we end up with Scotland owing cUK money - thats the only time that the NI contributions of Scotland and cUK actually matter.
Can you explain how you have arrived at such an asymmetric position with the cUK paying to Scotland but Scotland not paying to cUK in respect of former UK pension obligations?
Picking through the rest of your ramblings.
DeleteThere is no legal right to a pension from the UK. That has been proved comprehensively in the European Court (again if you’d read the blog you would know that). Therefore there is no question of the cUK being compelled to pay pensions for Scots legally or morally given that the pay as you go system is used internationally as well.
A pay as you go pension scheme is not mismanagement but quite a natural way to pay for pensions though a state pension system. If it’s all about mismanagement why do the SNP employ these systems for public sector schemes and why do they propose exactly the same system for Scotland post independence. At least try to be consistent.
Scots paying for Scots pension is the only logical outcome of this arrangement. For example say, remarkably, the Scottish Government changed their position and demanded that cUK paid their pensions? If cUK said that they wouldn’t then what? Scots Pensioners don’t have a vote in cUK, they would therefore turn to the Scottish Government to make their payments to them. Net result, we end up in the position that both sides already agreed on. Scots pay for Scots, cUK pay for cUK.
That is the only logical outcome of these negotiations and it’s why going into these negotiations both sides agree on the outcome, Scots pay for Scots and cUK pays for cUK. The trouble is you want to argue a different outcome will arise but have no idea how or why the cUK would do Scotland such a favour as to pay for Scots pensions and not expect Scotland to pay a population share of cUK pensions.
You’ve got a ridiculous amount of strawmen in your last post but again you’ve got nothing to back up your position other than assertion and moral outrage that no one will agree to your asymmetric proposal.
Maybe instead of ranting you can explain:
1 If the Scottish Government expected cUK to pay for current pensions why is it not in their budget?
2 Why is there no statement to that effect in any Scottish Government document?
3 Why would cUK agree to such an asymmetric proposal for pensions?
4 Why do you think there is a legal contract for a welfare system that doesn’t have a contract and has been proven not endow taxpayers with future legal rights at the level of the European Court?
Still waiting for a reply to my last post, what's the matter, cat got your tongue?
DeletePatience Valeman, I have several other things to do than moderate your posts.
DeleteThere is no contradiction in my opening comments, we just disagree on who will fund the pension scheme which the Scottish government would quite rightly claim administration of on independence. Don't they already administer the public pension scheme (teachers, firemen, etc) for which Westminster sends them a cash transfer?
ReplyDeleteAs for you claiming that I have deliberately misquoted Steve Webb's comments, well that's just a flat out lie on your part. I transcribed (just like you have) part of his comments which were relevant to the point I was making at that time. Lets go over it again briefly, he was saying that citizenship was irrelevant, but what does matter was the accrued rights of the individual who has paid the necessary NI contributions. In other words if you've paid your dues dutifully throughout your working life then the UK will provide you with a pension no matter where you live.
Let's get hypothetical here and look at 2 Scots who've paid their dues retiring the day before Scotland officially becomes independent. One decides to spend his remaining years as an expat in Spain whilst the other remains in Scotland, According to Webb both have banked the right to a state pension from the UK. But you are clearly of the opinion that only poor old Jock remaining in Scotland will lose out on the UK state pension? Seems rather harsh don't you think while his mate on the Costa Del Sol is laughing all the way to the bank.
One of you is telling fibs and it isn't Steve Webb
Well at least you now agree beyond any doubt that the UK pension ends on independence. The responsibility for paying pensions lies with the Scottish Government and not the UK, so that is at least some progress for you Valeman.
DeleteYou transcribed a subsection of the full part that I transcribed of Webb's evidence you left out the important parts about paying for pensions (which is now the part we are disputing as you accept fully that pensions in Scotland - all of them - are paid by the Scottish Government). You cant with one had say the Scottish Government is responsible for making the payment and then with the other hand say that the UK government will pay it "no matter where you live". Try to pick a side it's so much easier when you are not all over the place.
When Webb did actually opine on the question of payment he was very clear as you know that it was for the Scottish Government to meet the bill. This is entirely in line with the Scottish Government in their Pension paper, the White Paper and their post independence budget. You have to ask yourself why you think you are right and Steve Webb and the Scottish Government are wrong on this?
In the situation you describe the Scottish resident would be paid for by the Scottish Government and the one in Spain by the International Pension Centre funded by the Scottish Government. None of this is hard.
You might want to look at the latest blog by the way, because as usual you haven't thought it through Valeman. I'll give you a hint. If the former UK pension obligations now rest with the cUK why dont a population share of those obligations also lie with Scotland which was part of the former UK?
Have a think before reading the next blog and making another fool of yourself.