Pension deficit: ‘Young people are already struggling with living costs’
I WAS disappointed to read the article in Monday’s Guernsey Press in which Deputy Emilie Yerby appears to suggest that young people should be the primary source of funds to make up the deficit in the social security pension fund. (‘Pensions set to cost more’, 27 November)
Ms Yerby seems to have overlooked a very obvious injustice in the current Social Security contributions set-up and also failed to realise that her suggestion appears to contradict some of her manifesto pledges at the last election (nurturing and retaining tomorrow’s workforce and supporting young families).
How many islanders realise that there is a cap on contributions and high earners do not have to pay any social security on earnings of over £138,684 in 2017?
I believe that this means a young person earning £25,000 pa. pays the flat 6.6%, but someone earning £250,000 pa. only pays social security on the £138,684, meaning that their social security contribution is £9,153.14, or a mere 3.66% of gross income. How can anyone say that this is fair?
Many young people are already struggling with the cost of living, and unless the States is intent on driving them out of the island I suggest that this inequity in the current system is addressed as soon as possible so that those who can afford to pay more make a fair contribution to the pot and help to reduce the deficit.
Name and address withheld.