Until there is a fair
pensions
policy, we shall not all have the chance to share in the Islands's
"Prosperous and Caring Society".
September 2004 - Pensioners and rising costs.
May I follow up Peter Chapman's
letter about
pensions (Examiner 31/8/04).
Rising costs in fuel and domestic
rates make
utter nonsense of the last pension rise of 2.8 %, especially when MHK's
have awarded themselves 20%. Now is the time, if ever, to award
the Manx Supplement to all pensioners, or many will face extreme
poverty. Rates and fuel rises aready exceed pension rises,
leaving less to live on each year for all the other rising costs.
Like it or not, if we live long
enough, we
shall all become pensioners. No matter how secure our jobs and
future pensions may seem at present, changes in personal or global
circumstances can easily bring about reliance on adequate government
provision.
It is therefore the duty of all of us
at the
ballot box, to consider the pensions policies of the candidates we vote
for. To be a prosperous and caring society, we need a government
based on compassion for all, not "get rich quick" for the few.
October
2004 - Gulf between rich and poor.
Two items caught my attention in a
recent
edition of the Examiner. One was a letter from a single mum with
two children, desperate to know where the rent was coming from.
The other was an account of nearly 400 wealthy visitors, playing golf
and speeding round the Island in a £112,000 Bently car.
Together, they demonstrate the
utterly shameful
gulf between rich and poor, both here and across. A gulf that
continually gets wider, as rising costs far outstrip meagre pension
rises.
Limiting pensions to that totally
false 2.8%
inflation figure, is as dishonest as stealing money from a blind man's
hat. We all know how the cost of domestic fuel, water, rates, and
now milk, have risen in the last few years. We also know how the
government has cheated, by including all the latest products in the
inflation figures. Items like DVD players and digital
cameras, not generally part of a pensioner's budget, always start high
and fall rapidly in price.
To draw a pension, we are now told we
must work
longer, die younger, or save more. The value of a pound has
fallen to about 2p in 50 years - an average year by year inflation
rate of around 8%. Even with bank interest, that
pound can still retain only a tiny fraction of its former
value. How do we save in these circumstances? With
today's house prices, student loan repayments, and easy credit at low
interest, how can there be any inducement at all to save?
To discourage saving even more, we
have today's
means-tested benfits. Why struggle to save for a pension, when
all you do is to disqualify yourself from Income Support, and all the
goodies that go with it? You could have spent all your money on
booze and fags, and still enjoy a good retirement as a real "drain on
the state".
Closing the gulf between rich and
poor by fair
taxation could be a way to ensure an adequate pension for all.
Let's face it, the rich have become so only by exploiting the
poor. It is only fair that they should give back some of their
gains. This not the voice of envy, but that of common
sense. We all know the professions that charge a lot of money for
poor service, and run the biggest cars.
Our economy is one of low income
tax and
wildly escalating property rates and fuel costs. That means
that people on a low income have to spend a greater proportion of
it on tax and other unavoidable costs, than do their more affluent
neighbours. This is grossly unfair, and needs to be
corrected by a more progressive tax system.
We should have more income tax and
less rates,
or better still, abolish rates altogether. The government also
needs to look at its system of business grants, which seem to just add
more wealth to the wealthy. A saving here might fund payment of
the "supplement" to all pensioners. Most of all perhaps, we need
a complete revision of means-tested benefits.
As inerim measures, could I suggest a
rate
rebate scheme, and, following the practice of the airlines, a variable
"fuel cost supplement" added to the basic pension. Pensioners
should no longer be faced with the dilemna of whether to freeze or
starve.
Just where is that "caring
community as well as an economially successful one",
recently spoken of by our chief minister?
November 2004 -
Opening of JFP website.
Readers will no doubt be aware of the
many
letters in these columns about the
rights and well being of pensioners.
I have now opened a website:"Justice
for
Pensioners", which I hope
will form a platform, not only for more detailed discussion
of these topics, but also for entertainment and recreation.
Priorities of course will be the
need for
pensions to keep up with the true cost of living, with its steeply
rising fuel costs and rates; along with fairer taxation that does not
penalise tthe poor, and benfits that do not discourage thrift.
Other targets might be the
ability to hear
the kind of music we like, or to have easier access to the Internet.
"Accessibility" will be a main
feature of the
site. Text size will be adjustable by the reader, and sound files
may also be included. Perhaps even a bit of tuneful music!
(quite legal to download).
Input is welcome from all sources.
January
2005 - Corruption, free speech and democracy.
I think most of us will agree that
last year
has been a bad one politically for the Island, culminating in the House
of Keys defining the word "corruption", the loss of free speech
(by closing the Mannin Line and Manxnet Forum), and generally a bad
press in the UK.
Can we look forward to something
better in
2005? At risk of being told about the "morning boat", I will make
some suggestions for radical changes.
On local government reform, the whole
system of
raising finance by the "rates" needs to be totally scrapped and
replaced, either by local income tax, or funding from central
government. This would be fair, nd reflect abilility to
pay. If the present trends continue, we shall soon be paying back
more in rates than we receive in pensions. Ireland has done it,
and the UK is reviewing its council tax. Can we not take a lead
here?
Something has to be done about rising
fuel
costs. On an island surrounded by tides and swept by winds, it is
utterly ludicrous that we should be held to ransome by a monopoly gas
supplier. With Lady Isabella (the Laxey water wheel)
as our symbol, let us
at least investigate these new and clean sources of energy.
And on the subject of clean energy,
is it not
time we introduced "smokeless zones" to the Island? Must we
continue to be suffocated by coal smoke whenever we open our front
doors on a winter evening? Cutting the price of other fuels will
help in this respect.
My initial reaction to government in
the Isle
of Man was that it would be a refreshing change from the tangle of
party politics "across". But what a disillusion. There
seems to be very little that the Island can decide for itself,
independently of Brussels or Westminster. Yet we have no
democratically elected representatives in either of those
places. Just something called "Protocal 3" which seems to give us
the worst of everything.
Is our government proud of the fact
that, along
with the UK, we have the worst pension of the major European countries
at 16.75% of average wage? Does it also consider itself to be
perpetuating a degree of racism by its continued selective payment of
the Manx Pension Supplement?
Here are just s few more of the
questions I am
sure many may want to ask. Would we be better off with a
chief minister (or president) elected by popular vote? Do we need
more than a one-man opposition in our government? Does our whole constitution need revising
to bring
us into the 21st century. Has our historic House of Keys become
the House of Sleaze?
There is much that is good about our
Island,
but that is no reason for not making it better. While
we still have some democracy here, let us use it for making the
improvements we need.
February 2005 - Comments
on budget
The budget may be the subject of self congratulation by our governmet,
but it leaves little comfort for pensioners, who are now quite
literally left out in the cold, as they face massive heating bills.
Inflation is now accepted by the
government as 5.9% . Yet pensions have risen by only
3.1%. This leaves us now, quite officially, almost 3% worse off
than before.
To crown this, Onchan Commissioners
have just
announced a rate rise of 7.5%, and I have no doubt this could be
reflected throughout the Island. In the UK, even the Tories are
now talking of halving the council tax for pensioners. Is it not
time for something like that here? That is of course until such
regressive taxes are abolished altogether.
I may not be the only one
puzzled by the
huge tax generosity shown to some iindustries here.
When we see alll the glitz and
glamour of the
of the Oscars and the BAFTA's, can anyone really believe that the film
industry is hard up? Should ordinary workers and pensioners be
subsidizing the lifestyle of film stars?
Should such a morally degenerative
activity as
on-line gaming be encouraged by tax incentives? It can ruin lives
as much as drink and drugs, and shows high profits anyway.
Could pouring money into tourism be
"flogging a
dead horse". Grants for holiday accommodation may be
seen by some as adding wealth to the wealthy. The way
to get visitors, is to make it cheaper to come here.
Why do flights to sunny continental destinations cost less than
the relatively short hop to the Isle of Man?
In short, could our government give
more
thought, not just to wealthy businesses, but to its ordinary
citizens, and , and in particular, show less meaness to its pensioners.
April 2005 - Rating revaluation.
It is sad to read that our government is planning a rating
revaluation. Sad, because it may cost millions that
would be better spent on health, education and
pensions. And sad again, because the rates are such an
outmoded and unfair tax, hitting hardest those who can least
afford it.
Rates bills have soared
by about seventy percent in eight years,
compared to about a thirty percent rise
in pensions. More than twice as much. Add to this the
galloping inflation in gas and electricity bills, and it becomes
a mathematical certainty that these three costs alone must
eventually overtake any income tied to the official inflation
figure.. The only question is when.
Many will be threatened by extreme
poverty if
the trends are not reversed. Yet our government still
buries its head in the sand, by refusing to accept that
pensions should be related to fuel costs, and local taxes to
the ability to pay.
The mechanism to collect income tax
already
exists, and could easily be adapted to collect a bit more for local
purposes. Far simpler and cheaper than a massive revaluation
excercise, and the result much fairer.
Or perhaps we might go a stage
further and
ask if we need local government at all. A
few years ago, the Isle of Wight was governed by several urban district
councils . Later, it became a county with two
boroughs, which finally were merged into a single tier
of government known as a "unitary authority". The saving in
bureaucracy was enormous.
Could the Isle of Man do the same?,
Just one
tier of government would take over all local
services. Local committees could ensure that each
area received a fair share of the cake, but would themselves have
no spending or tax raising powers. No rates. No
valuation. Just a bit more income tax.
Does anyone else have ideas? It
wouold be
reassuring to hear from just one MHK supporting a policy of fair tax
and pensions, that would lead the Isle of Man into the
twenty-first century.
May 2005 - Domestic
rates and means tested benefits.
I write in response to "Bells
battle..."
(Examiner, 10th May).
Although I have written before about
pension
injustice, there are two areas that need to be stressed where
reform is urgently needed - Local authority
rates and means tested benefits.
Allan Bell's proposed rating
revaluation is
regressive almost beyond belief. The way forward is to completely
abolish this outdated and unfair tax. It hits hardest those
who can least afford it, by taking the greatest proportion of their
income. It is time for it to pass into oblivion with
the window tax. Think also of the money to be saved by not
carrying out such a revaluation.
The generally preferred alternative
is a "local
income tax". It certainly reflects the ability to pay, and the
mechanism to collect it is already in place. However, here in the
Isle of Man, it seems that we might go a stage further, and ask if
we need local government at all. Could public housing, waste
collection, libraries and other local services, all be administered and
funded by central government? In that case, they would
automatically be paid for from income tax, VAT and excise duties.
What could be fairer?
As it would no doubt take many years
to
implement such a scheme, perhaps we need to look at short term
remedies. Could we put a cap on the rates paid by a
household, that would depend on its total income? That would
certainly help pensioners. With
any
kind of tax reform, there are winners and losers. In this
case, the only losers would be the wealthy who can afford it. The
only protest would come from the selfish and greedy.
The Treasury Minister seems to be
directing
help regarding fuel bills to those on income support. Does he not
realize how many are on the borderline and do not receive this
benefit? Would he consider a "fuel cost supplement", to be added
to all pensions?
But a little more about income
support and
other means tested benefits. Their effect is pernicious in
several ways. If you receive them, you are caught in a
poverty trap, out of which any escape is discouraged. Every penny
you may earn is deducted from your benefit, leaving you no better
off. You are doomed to poverty. If you are working, you
could lose the incentive to contribute to a pension, or save
for a rainy day, as this could easily disqualify you from
benefits you might otherwise later receive.
Means tested benefits in their
present
form are bad. They discourage prudence , thrift, and self help,
and are socially degrading to those who need to claim them. They
should be replaced by what in principle might be called a "negative
income tax". Instead of an offensively inquisitorial
multi-page form, only the conventional tax return would be needed to
claim it.
What is certain, is that the present
rates and
fuel bills, rising wildly out of all proportion to incomes, simply
cannot continue. Otherwise, whole incomes will soon be spent on
these costs alone. So really, Mr. Bell and your fellow ministers,
you must get your heads out of the sand and do something positive.
Oh, and by the way,
just as an
afterthought, why not end that farce of the two tier pension by paying
the supplement to all pensioners. It would certtainly help with
the fuel costs.
September 2005 - John
Rimmington and rates revaluation.
So we are to have a rating revaluation,
with a banding system based on capital values. In everything but
name, this is the hated council tax from across, which is driving all
those on low incomes into even greater poverty and misery, and has sent
an old lady to prison.
With such a
proposal, how dare John Rimmington speak about the fairness
or otherwise of taxes? Does he hate pensioners so much that,
besides branding them a "drain on the state", he now wants to squeeze
them out of existence by this oppressive tax? He says there
is no fair tax. Come on! Any tax related to the ability to
pay has to be fairer than one that is not. That is what most
people agree, but not Mr. Rimmington.
He says that some
people pay little or no income tax, and so the burden would fall
disproportionally on those who do pay. Good heavens! That
is the whole idea - relating it fairly to the ability to pay! Do
MHK's consider only the effect on their own pockets? Do they
begrudge a bit of extra tax on their own generous salaries, in order to
lift thousands of others out of poverty?
As an island, we
take a pride in our heritage. We have preserved many relics
from the past, for enjoyment by ourselves and tourists alike. They
include our railways, horse trams, the Laxey wheel, and so on.
But let us not extend this to preserving an obsolete system of
government and taxation. Property based taxes now hit hardest
those with a low income, by consuming a greater proporttion of
it. They are archaic, and along with the window
tax,should be scrapped.
We need forward
thinkers in our goverment to ensure a fair and equitable society in the
future. With a well managed economy, and a fair tax system, no
one need go through the degradation of claiming income support or tax
rebates. What did the official brochure say about "all sharing in
a prosperous and caring society"?
But for now, let
us make one thing clear. We don't want the "council tax" in the
Isle of Man!
October 2005 - We have
paid for our pensions.
Hardly a week passes without without a
letter of complaint in these columns about the diminishing value of the
state pension paid in the Isle of Man. On the other hand, there
are those who accuse us of "whinging". Perhaps they are of
considerable independent means, and see their pension as just "pocket
money for sweets". Good luck to them. But for some of us,
it forms a considerable part, and in some cases perhaps all of our
income after retirement.
Not only that, but we have worked hard and
paid for it. It is ours by right,and not as a charitable
gift. The present generation of pensioners from the UK have paid
dearly for it, not only in national insurance, but high levels of
income tax with a standard rate up to around 35 percent.
In the past, considerable amounts of that
money were paid to the Isle of Man government to cover the pensions,
paid under the reciprocal scheme, to UK residents moving here.
That money created the surplus that made possible the payment of the
Manx Pension Suppplement. Ironically, it seems that the very
people whose payments created that fund, are the ones to whom its
benefit is now denied.
This is not justice. We are all
faced with the same rising fuel bills, rising water costs,and rising
rates. With rising oil and transport costs, a further round
of inflation could be on the way.
But perhaps justice is not in the
vocabulary of our our present MHK's and ministers, who seem to
arrogantly defend the status quo regarding payment of the Supplement
only to those with 10 years or more of Manx NHI contributions. We
have all paid for it! We should all get it!
Here I would like to issue a challenge,
which has the backing of IOMPA members. It is for any MHK,
minister, or government official, to produce a budget for living
indefinitely on the basic state pension of £82.05p per
week. That is for everything - rent
(or mortgage), rates, fuel, food, clothes, transport, entertainment
- everything. The next task for them would be to fill in one
of those lengthy and degrading forms to claim income support, and be
utterly thankful they are not doing it for real.
They have a little more than a year now to
make changes before the next general election. In the
menantime, I hope that fresh prospective candidates will be looking at
the situation, and offering some new roads to democracy. Pensions are bound to be a major issue at that
election. Let's all be ready for it.