Income Tax and Social Insurance are schemes dreamed up by rulers and weak politicians to get themselves elected. The more they offer freebies to a gullible public, the greater the chance of them gaining and remaining in office. The reforms of Beveridge and Bevin set the precedent for the state to take control and influence people’s lives from one of self-sufficiency to ‘cradle to grave’ dependency. In doing so, the greatest Ponzi scheme ever was created; one that would be criminal in any other sphere. Thus the blame lies squarely on the politicians and administrators who have failed to grasp the real truth. The system has been in place long enough that had it been managed by competent, knowledgeable people who exist in the real world and not some civil service, luxury bubble, the fund would have been moved from the position of what is paid in gets immediately paid out to a surplus over time and away from the Ponzi nature of the initial scheme. Just like households that manage their affairs efficiently and competently do when they put money away towards their retirement.
Ponzi schemes work as long as you feed money in at the bottom and you should be able to pay it out at the top – until that equilibrium is broken. The premise that it is the fault of the over 65s increasing overlooks the fact that those coming in at the bottom do not start contributing until a much later age than those who have contributed all their lives, only to find themselves vilified and accused of stealing their future.
The generation 65-plus started work at 14 or 15 and paid into the system all their lives, doing more than one job at a time to put a roof over their heads and make ends meet. Today’s generation see it as a right to go to new age Blairite universities with entrance standards lowered to allow the majority in, to study for a worthless degree that has no prospect of helping them get gainful employment beyond working behind the counter at McDonalds. And the thought of having to suddenly start work brings them out in a cold sweat and so they need a gap year to come to terms with it. Finally at 21-plus they may start paying into the system. Those who do gain worthwhile degrees are likely to spread their wings and never come back and help support the island that gave them the ‘leg up’ in the first place. Had they gone from school to gainful employment at the age of 15 to 16 it would have helped to bring the Ponzi see-saw back into equilibrium. The media might like to find out how many students are away at any one time avoiding work conscription and the contribution to tax and welfare thereby lost to the exchequer to help balance the account.
To compound the lie told by their predicated statistic, it is implied that at 65 people pay nothing more into the system. Many are paying as much or more in income tax than they did when they were working and pay a non-employed social security contribution as a percentage of all income, whether actually received or just deemed to have been distributed/received. Many will die, having paid until their last breath, while the teeny whiners pay in nothing but have no conscience about exploiting what the Ponzi scheme has fostered. The weekly pension that is received sees approximately 24% deducted if you have had the audacity to bring in more than the allowances that many would find it hard to live on. Yet when they need an operation to maintain their quality of life, many will die waiting. Get to 70 and you are at the back of the queue.
To get the treatment you had come to expect by your service and contribution to society over the years means having to pay into additional health insurance running into thousands per year.
No waiting times there.
Indulge a thought experiment as a modern day More’s ‘Utopia’. Let all the over-65s move away and take their wealth and contributions with them to live in their own self-sufficiency. How much would the black hole be when Guernsey no longer receives the income from income tax and social security contributions they had been using to support and cosset the critics who have yet to be a worthwhile, contributory member of society?
The problem needs addressing indubitably, but the argument is not valid solely rested on the premise of the drain caused by the over 65s.
The problem squarely starts with the young.