Turner Report - State Pension debts

The Turner report into the state pension has the following

""We have suggested that the state pension age will have to rise to somewhere between 67 and 69 by 2050 and that public expenditure on pension and pension benefits will need to rise from 6.2% of GDP today to between 7.5% and 8% GDP in 2050."


So what's GDP?


http://www.guardian.co.uk/news/datablog/2009/nov/25/gdp-uk-1948-growth-economy#data

1,533 billion.

So 8% of linked to inflation is around the 123 billion a year mark.

What's current government taxation?

http://en.wikipedia.org/wiki/2011_United_Kingdom_budget

589 billion a year

So to put the pensions in context, that is 21% of all taxes going on just one debt.

At 5% interest we can compare the Gilt debt with future pension payouts.

2,460 billion. (note not millions, billions)

All hidden off the books.

Just one way of looking at one of the government frauds. Hiding the debts off the books so it can carry on spending.

Very bluntly they are running a Ponzi, and they know it. To hide the figures shows that its deliberate.

The consequences for MPs? Well they made sure their pension was fully funded and not a Ponzi. They've made sure they aren't a victim of their fraud.

The cotton plantation

http://www.youtube.com/watch?v=vb8Rj5xkDPk

Well worth a listen. The state are slave owners. That's why the left wants to book people as assets of the state, slavery, to try and balance the books.

The Railway Rip Off

Meanwhile over at the BBC

Costs per passenger km for different systems, in Greece. However, the BBC lets slip the figures for the UK.

Train: 0.6 euros (48p)
Taxi (for one): 1.2 euros
Taxi (for four): 0.3 euros
Plane: 0.14 euros
Bus: 0.08 euros
Car: 0.18 euros
UK train: 0.3 euros

http://www.bbc.co.uk/news/magazine-18032721

We're being forced to pay for the UK train system, even if we don't use it.

Look at the cost of buses/coaches in comparison. 0.3 / 0.08 = 375%

The state's a rip off.

The Teneriffe Aircrash

The investigation would reveal that the primary cause of the accident was the captain of the KLM flight taking off without clearance from Air Traffic Control. However, the investigation would specify that the captain did not intentionally take off without clearance; rather he fully believed he had clearance to take off due to misunderstandings between his flight crew and ATC. Dutch investigators would place a greater emphasis on this than their American and Spanish counterparts,but ultimately KLM would admit their crew was responsible for the accident, and the airline financially compensated the victims.

The accident had a lasting influence on the industry, particularly in the area of communication. An increased emphasis was placed on using standardized phraseology in ATC communication by both controllers and pilots alike, thereby reducing the chance for misunderstandings. As part of these changes, the word "takeoff" was removed from general usage, and is only spoken by ATC when actually clearing an aircraft to take off. Less experienced flight crew members were encouraged to challenge their captains when they believed something was not correct, and captains were instructed to listen to their crew and evaluate all decisions in light of crew concerns. This concept would later be expanded into what is known today as Crew Resource Management. CRM training is now mandatory for all airline pilots.

http://en.wikipedia.org/wiki/Tenerife_airport_disaster

Now what's the relevance of an air crash to the government? Well, politicians are behaving the same way. They aren't questioning what is going on. They are suffering from Group Think. 

The standard group think is that the deficit means the same as debt. Often exposed by people like Gordon Brown that the government can pay down the deficit. You can't. The deficit is an overspend.

Next comes what is a debt. They will just admit to gilts being debts. State pension? Not a debt. Implication is simple they won't pay it. Civil service pensions? Not a debt. It's not on the books. State second pension. Not a debt. All paid for up front, but it won't be paid because the debts are too large.

So politicians are behaving like the captain of the plane. The aren't listening to all the alarms going off. They are intent on full speed ahead when its clear there is going to be a crash.

Addison Lee

The real story relates to bus lanes.

Mr Addison Lee has told his drivers to drive in bus lanes just like Black Cabs. He will defend them in court, and pay their fines if they are fined.

Now why does he think he can win? Well its down to European law. European law bans illegal state aid to one part of an industry compared to another. That applies to handouts as well as legal discrimination.  So black cabs and addison lee are both in the taxi business. You can't ban one and not the other.

TFL are worried on one major point. If they lose, its retrospective. It's that TFL was acting illegally, and that means they have to hand back the loot. That's really worries them. Now they can deal with it in two ways. Give in and allow him in by changing the law then he probably won't go for the test case, or they can ban all taxis from bus lanes. Bound to piss off lots of MPs and Peers.

The same applies to the post office parking on double yellows. White van man needs to sharpen up and work out that in the delivery business, that is also illegal state aid.

More ways that the state have created regulations where they will be shafted as a result.

The state pension rip off

There is the obvious question, is the state pension a good value for money?

First we need to know what the historical facts are.

For the past 60 years, we need to now RPI or inflation, historical wages, and the level of the FTSE.

Other information is available here. CPI and RPI, Average Wages

A reasonable yield, or average dividend for the FTSE is 3%.

We also have the median wage for the UK of 26K. From the tax calculator here, we can get the NI paid by or on behalf of the employee. It is 2,253 plus 2,612 or 18.71%.

Tax Calculator

So now we can work out what median wages are for a person retiring on median wage last year, back to when they were 18. We then take their NI, invest it in the FTSE, add on the 3% of yield. Next year, we do the same, and the FTSE can go up and down.

At the end, we have a fund. We then take that fund and invest in the most expensive (lowest income) annuity going. Joint life and RPI. Anutity rates here.

End result is that a median wage earner would have got 18,587 a year, rising with inflation, until both died. Instead they got a touch over 5,000 a year.

That's some rip off.

Calculations for the details.

Yet another rip off by the government, of what can't be described, as anyone rich.

More rip offs.

Merve the Swerve is up on the TV again pleading like a little kid for yet another go at controlling inflation

"Please please, let me have another go, I'll get it right next time"

So how much of a rip off has he presided over?


Well this graph starts off with the inflation target at 2.5% RPI, in May 1997. In December 2003, the target was changed to 2.0% using CPI. It looks at just how well the Bank of England tracks prices over time, rather than its year on year inflation figure. If the Bank of England does its job, then the line will be around zero.

It's not. Its over 7% above where it should be if it had done its job.