Service pension if Scotland were to become independent
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Service pension if Scotland were to become independent
I wished to know what effect Scottish independence would have on my pension and asked the question of the yes campaign as Scotland would then be outwith the UK I wanted to know if my pension would be frozen as I would now be residing in a foreign country. Here is the response I received:
"Q. What happens to my military pension?
A. The Scottish Government has also published an extensive guide to "Pensions in an independent Scotland". It explains that "this Government proposes that an independent Scotland will take on responsibility for the pensions of staff within the civil service, armed forces and others who work in Scotland’s public service, as well as existing pensioners and deferred members".
The paper also provides the following reassurance: "On independence, the public service pensions of members of currently reserved schemes who live in or work for Scotland – for example, the armed forces and civil servants – would continue to be paid in full".
The Scottish Government confirms that all rights and entitlements to public service pensions will continue to be protected on independence, and that there will be no difference to individual contribution rates or benefit levels as a result of independence. Your pension will therefore not be frozen."
"Q. What happens to my military pension?
A. The Scottish Government has also published an extensive guide to "Pensions in an independent Scotland". It explains that "this Government proposes that an independent Scotland will take on responsibility for the pensions of staff within the civil service, armed forces and others who work in Scotland’s public service, as well as existing pensioners and deferred members".
The paper also provides the following reassurance: "On independence, the public service pensions of members of currently reserved schemes who live in or work for Scotland – for example, the armed forces and civil servants – would continue to be paid in full".
The Scottish Government confirms that all rights and entitlements to public service pensions will continue to be protected on independence, and that there will be no difference to individual contribution rates or benefit levels as a result of independence. Your pension will therefore not be frozen."
Again, as per my answer on your other thread, easy for them to say - much harder/impossible for them to implement. Thanks for raising the issue with them though as it will also affect me directly. I just don't believe they will have the power to make good on all the promises they are delivering. In the event of independence there will be so much horse-trading to split the countries that I suspect service and ex-service personnel's interests will not be at the top of the SNP agenda.
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Any idea how substantial the armed forces pension bill as drawn by ex forces personnel resident in Scotland actually is? What I'm getting at, is it substantial enough to present a real risk. I suspect pensions earned while under service of the UK would be honored by the same ie funded by transfer from UK gov. The UK would have had to pay them anyway! But certainly a good question tomdocherty.
Who on earth would believe the Scots Nats? Even if the UK government paid them our pensions to be forwarded to is, what's to stop them paying it to some out of work junkie in Glasgow? I'm making arrangements now to be resident in England from 19th September and declare my house in Scotland as a holiday home?
Do not let these idiots get their hands on your hard earned pensions!
Do not let these idiots get their hands on your hard earned pensions!
I live in New Zealand and have done since i left the RAF in 1994. My pension is paid into a UK bank account directly from the Paymaster. The original terms of the pension are still extant. Every year I get the same percentage rise as those that still live in the UK. I would presume that those living in Scotland post Independence (if it happens) that are currently receiving a pension will be treated in the same way. However, how any that choose to transfer to the Scottish Armed forces are treated is anybodies guess. Oil will run out soon so where will the countries revenue come from?
More of an issue may be the Old Age pension. As I live in NZ I am entitled to receive the UK pension at 65. However, it is not indexed linked so I am stuck with the starting level for the rest of my days. Unless Scotland is able to get some sort of agreement with the UK government then that may also be the case for you.
More of an issue may be the Old Age pension. As I live in NZ I am entitled to receive the UK pension at 65. However, it is not indexed linked so I am stuck with the starting level for the rest of my days. Unless Scotland is able to get some sort of agreement with the UK government then that may also be the case for you.
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I thought that pensions are paid from the Defence budget rather than invested funds as happens on the civvy side of the fence. If so the money coming from future earnings, so I would expect that the it would be a future joint UK/iScotland funding source to pay pensions rather than a lump sum transfer. The same would apply to all government employees with pension rights.
If I read the Yes campaigns answer to the question put by the OP correctly, then they are proposing (among other things) that an independent Scotland would take on responsibility for paying military pensions for those already retired who are living in Scotland after independence.
The question I have to ask is why? It could open up a can of worms, and there is already a working system in place for paying UK mil pensions to people living in "foreign countries" (as per the person living in NZ in post 5) involving bilateral agreements on such things as where tax is paid. If the OP were to move to Belgium tomorrow, as he is entitled to do as an EU citizen, then his pension would continue to be paid by the UK government in accord with the agreement in place with the Belgian government, this almost certainly involves being paid in Ł, with the emigrant having to live with fluctuations in exchange rates.
Lets look at a specific scenario, involving the OP (hence known as TD) and his mythical twin invented by me (TD2) living in England who has accrued EXACTLY THE SAME MILITARY PENSION ENTITLEMENT as TD.
Let us say that it is 2019, and Scotland is fully independent. However, due to the lack of a currency agreement between the two governments, the currency in use in Scotland is the Scottish pound (ScotŁ). While the ScotŁ and UKŁ started off at 1:1 parity, over the years the ScotŁ has come to be worth less than UKŁ. TDs mythical twin is currently receiving UKŁ30,000 a year in pension. However, while TD is receiving ScotŁ30,000, this is now only the equivalent of say UKŁ28,000. Thus, while TD and TD2 have earned equivalent entitlements, they are not receiving equivalent benefits. The Scottish government has therefore failed to fulfill its pledge, that there will be no difference to individual contribution rates or benefit levels. Would TD be within his rights to take the Scottish government to court over this, no doubt eventually ending in the European court of human rights. Has his right to receive his full pension entitlement been breached?
Does the Scottish government track the ScotŁ to UKŁ exchange rate and pay TD a different amount each month to compensate him so he receives the same as TD2?
If instead of some form of Ł, an independent Scotland were to join the Euro, once again would TD be paid a different number of Euros every month as the Ł to Euro exchange rate varies to ensure he receives the same entitlement as TD2?
There could also be the situation where exchange rates (whether it be Scottish pounds or Euros to the Ł) see TD getting effectively a higher pension than TD2, is his income cut in this case?
At the end of the day there is already a system in place that works well for those who are already retired who end up living in a "foreign country". If it ain't broke, don't fix it!
As ever, I may have got the wrong end of the stick, and am willing to be corrected........
The question I have to ask is why? It could open up a can of worms, and there is already a working system in place for paying UK mil pensions to people living in "foreign countries" (as per the person living in NZ in post 5) involving bilateral agreements on such things as where tax is paid. If the OP were to move to Belgium tomorrow, as he is entitled to do as an EU citizen, then his pension would continue to be paid by the UK government in accord with the agreement in place with the Belgian government, this almost certainly involves being paid in Ł, with the emigrant having to live with fluctuations in exchange rates.
Lets look at a specific scenario, involving the OP (hence known as TD) and his mythical twin invented by me (TD2) living in England who has accrued EXACTLY THE SAME MILITARY PENSION ENTITLEMENT as TD.
Let us say that it is 2019, and Scotland is fully independent. However, due to the lack of a currency agreement between the two governments, the currency in use in Scotland is the Scottish pound (ScotŁ). While the ScotŁ and UKŁ started off at 1:1 parity, over the years the ScotŁ has come to be worth less than UKŁ. TDs mythical twin is currently receiving UKŁ30,000 a year in pension. However, while TD is receiving ScotŁ30,000, this is now only the equivalent of say UKŁ28,000. Thus, while TD and TD2 have earned equivalent entitlements, they are not receiving equivalent benefits. The Scottish government has therefore failed to fulfill its pledge, that there will be no difference to individual contribution rates or benefit levels. Would TD be within his rights to take the Scottish government to court over this, no doubt eventually ending in the European court of human rights. Has his right to receive his full pension entitlement been breached?
Does the Scottish government track the ScotŁ to UKŁ exchange rate and pay TD a different amount each month to compensate him so he receives the same as TD2?
If instead of some form of Ł, an independent Scotland were to join the Euro, once again would TD be paid a different number of Euros every month as the Ł to Euro exchange rate varies to ensure he receives the same entitlement as TD2?
There could also be the situation where exchange rates (whether it be Scottish pounds or Euros to the Ł) see TD getting effectively a higher pension than TD2, is his income cut in this case?
At the end of the day there is already a system in place that works well for those who are already retired who end up living in a "foreign country". If it ain't broke, don't fix it!
As ever, I may have got the wrong end of the stick, and am willing to be corrected........
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it's late and I've only scan read the thread, but I believe you (op) and possibly most who have replied have missed a fairly fundamental point.
Should Scotland vote yes, and should the UK legislative sovereign body (House of Commons and House of Lords, to you an me) uphold that vote...which they have said they will, some 18 months or so after the vote the UK ceases to exist.
For now, most people are content to represent that possibility, by labeling the resultant parts, Scotland and rUK, so let's go with that for now.
You (op) now get to decide your domicile...nobody, but nobody, can force you to be either a Scot (wherever you live now and wherever you were born) or a resident of rUK. In fact every single one of us living in Scotland (regardless of ethnic origin) and probably a very large percentage of those living in England, Wales and Northern Ireland will also face the same choice.
And the beauty of it is, no *****ing politician will have a say in our choice.
That is because we are all currently legally British...period. And when a democratic society changes its status by a democratic vote, its citizens defacto will have democratic choice of outcome.
If Scotland becomes independent (probably not) it will of course be able to enact any such laws as its society and its population wishes. But well before then, you and I will have had ample opportunity to foxtrot oscar down south (along with a sh1tload of wealthy jocks...if there is one thing history tells us, it is that fortune seeking jocks like to spread their wings...ain't that right 007)
Of course, if you decide to stay up here...well then that's your choice innit.
If you make that choice then it is pointless asking people for predictions...they cannot give them to you...nobody can. Nobody know what laws the new countries (Scotland and rUK) might enact. Anybody that tells you differently is basically full of it.
Personally, I am in the same situation, and there is no way that the responsibility for paying my pension will shift to the jocks. I'll be down the M74 and across the border quicker than you can say och aye the noo if that ever becomes even the remotest possibility.
Should Scotland vote yes, and should the UK legislative sovereign body (House of Commons and House of Lords, to you an me) uphold that vote...which they have said they will, some 18 months or so after the vote the UK ceases to exist.
For now, most people are content to represent that possibility, by labeling the resultant parts, Scotland and rUK, so let's go with that for now.
You (op) now get to decide your domicile...nobody, but nobody, can force you to be either a Scot (wherever you live now and wherever you were born) or a resident of rUK. In fact every single one of us living in Scotland (regardless of ethnic origin) and probably a very large percentage of those living in England, Wales and Northern Ireland will also face the same choice.
And the beauty of it is, no *****ing politician will have a say in our choice.
That is because we are all currently legally British...period. And when a democratic society changes its status by a democratic vote, its citizens defacto will have democratic choice of outcome.
If Scotland becomes independent (probably not) it will of course be able to enact any such laws as its society and its population wishes. But well before then, you and I will have had ample opportunity to foxtrot oscar down south (along with a sh1tload of wealthy jocks...if there is one thing history tells us, it is that fortune seeking jocks like to spread their wings...ain't that right 007)
Of course, if you decide to stay up here...well then that's your choice innit.
If you make that choice then it is pointless asking people for predictions...they cannot give them to you...nobody can. Nobody know what laws the new countries (Scotland and rUK) might enact. Anybody that tells you differently is basically full of it.
Personally, I am in the same situation, and there is no way that the responsibility for paying my pension will shift to the jocks. I'll be down the M74 and across the border quicker than you can say och aye the noo if that ever becomes even the remotest possibility.
Last edited by The Old Fat One; 25th Jul 2014 at 22:18.
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Earlier this week, the Office of Budget Responsibility released a document about lots of stuff. Para 35 (sad I remember) refers to the over estimates of North Sea oil stocks. My worry for the integrity and security of any preserved pension, held north of the border would be based on what happens, not in 10 years, but in 40.
In times of national crisis, when all the current politicians are in the 80s, will they really give a damn when the law has to be changed due to extenuating circumstances? Pensions south of the border (state, occupational or private) are nothing more than vehicles. If there's roadworks to be done, as we've seen, you might sometimes want to get out and walk.
In times of national crisis, when all the current politicians are in the 80s, will they really give a damn when the law has to be changed due to extenuating circumstances? Pensions south of the border (state, occupational or private) are nothing more than vehicles. If there's roadworks to be done, as we've seen, you might sometimes want to get out and walk.
