Bailing out TFL and Pensioners

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mercalia
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Re: Bailing out TFL and Pensioners

Postby mercalia » 17 Oct 2020, 4:12pm

jgurney wrote:
mercalia wrote: But there is an anomaly. I can go to Dartford and back but people living there cant.

Do you mean by train? The same applies to trains to Hampton Court and Thames Ditton - they are in Surrey, yet London pensioners passes are valid on them but Surrey ones are not.

The worst complications around these passes arose along the English/Welsh and English/Scottish borders. Generally, each nations' pensioners passes are not valid in the other nations. That caused some problems on cross-border buses, and became really absurd in Boundary Road, Chester, where the border runs down the middle of the road, so technically buses going one way along it are in England and those going the other way are in Wales. Special exceptions had to be applied


yes by train. There was talk about exending it to Gravesend. Would suit me fine.

mercalia
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Re: Bailing out TFL and Pensioners

Postby mercalia » 17 Oct 2020, 4:20pm

jgurney wrote:
mercalia wrote:Seems like the govt wants tfl to remove free transport for the 60+ incl pensioners in London as a condition of more bail out money

https://news.sky.com/story/government-offers-transport-for-london-further-1631bn-bailout-12105037?

.... There is a problem with the proposal. At the moment any one in England can use the local buses anywhere so if London pensioners could no longer use the buses for free we would have the anomaly that visiting pensioners still could!


I suspect the Sky report has been written by someone who does nort clearly understand the proposal. The plot is not to remove London pensioners bus passes altogether, but to remove the additional benefits above the basic bus pass. London Freedom Pass holders (pensioners and disabled people) can as well as using buses after 9:30 without paying also use buses before 9:30 and can use trains within the London area. Some other local authorities do similar things, e.g. Blackpool resident pensioners can use the Blackpool trams free while others cannot. The govt seems to want London resident pensioners stripped of these extras and confined to free bus travel after 9:30 only.


Do you have a reference for that detail? I dont think that was mentioned in either the Sky or BBC reports. I am surprised Johnson hasnt stamped his minister out as that would be as toxic as watering down the triple lock and the cost to the govt to keep tfl ticking over for 18 months a mere £6bn.

for any one who is interested here is a ref to the Freedom Pass laws and regulations and how it is funded
https://www.londoncouncils.gov.uk/node/4597

it seems it isnt just tfl that pays but also local councils , so it seems it is a bit more complicated

an interesting section
Apportionment of costs to boroughs
28. While costs were originally apportioned on the basis of pass numbers, the
introduction of smart card technology enabled actual usage to be determined.
Following arbitration in October 2008, apportionment is now based on the actual
usage of each pass where this data is available. For 2013/14, this covers buses,
underground, DLR and trams. National Rail and London Overground journeys
are now recorded on Oyster technology which will enable usage data to be used
for apportionment from 2014/15 onwards. However TEC agreed on 13 December
2012 that this change would be phased in over three years so that the 2014/15
settlement would apportion National Rail and London Overground 40% by usage
and 60% by the current method. 2015/16 would be apportioned 70% new method
and 30% current and 2016/17 onwards would be apportioned 100% by the new
method


so it looks like the cost to councils is based on actual useage. During the pandemic one would suppose the number of pensioners using it have gone down a great deal. So there is no strong argument to remove free access, as a) the councils are paying towards their pensioners use b) this sum is dependant on actual usage: if pensioners are not using the Freedom pass much removing it achieves little; and if they are, the local councils are paying a variable amount. ( where does the local council get its money from though?) The story as presented is about tfl ( mismanagement claim) and the govt which now seems to be only part of the story, you have to factor in the local councils also. Have I missed some thing or interpreted it wrong? It seems to me the whole Freedom Pass thing is a red herring to try and damage the Labour mayor prior to the new election is it next year? "Labour mayor mishandles funding public transport requiring the tory govt to step in and solve the problems he has created - vote for a tory mayor next year"

GeekDadZoid
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Re: Bailing out TFL and Pensioners

Postby GeekDadZoid » 17 Oct 2020, 5:03pm

philvantwo wrote:People who've never worked and claimed benefits all their life's will still get free travel. I've always said they should pay income tax and national insurance on their benefits.


That's a very silly idea really isn't it. So the state would give them money to then take some back? I am not sure if you think people who live on benefits have some kind of luxury lifestyle so they have lots of spare cash, I can assure you the overwhelming majority do not.

Cyril Haearn
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Re: Bailing out TFL and Pensioners

Postby Cyril Haearn » 17 Oct 2020, 5:21pm

I am retired and rarely go out before 9:30
Travel by train or bus is not very attractive even if cheap or free
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mumbojumbo
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Re: Bailing out TFL and Pensioners

Postby mumbojumbo » 17 Oct 2020, 6:21pm

[quotePeople who've never worked and claimed benefits all their life's will still get free travel. I've always said they should pay income tax and national insurance on their benefits.
][/quote]



You cannot pay national insurance on state pensions.Secondly noone claims benefits all their lives.Thirdly you are insinuating that the vulnerable and disabled should pay income tax on their benefits.The personal allowance is aroung £12000-few single people receive this much on benefits.

kwackers
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Re: Bailing out TFL and Pensioners

Postby kwackers » 17 Oct 2020, 6:23pm

Cyril Haearn wrote:I am retired and rarely go out before 9:30
Travel by train or bus is not very attractive even if cheap or free

Makes it even cheaper to offer then!

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Paulatic
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Re: Bailing out TFL and Pensioners

Postby Paulatic » 17 Oct 2020, 6:43pm

GeekDadZoid wrote:
philvantwo wrote:People who've never worked and claimed benefits all their life's will still get free travel. I've always said they should pay income tax and national insurance on their benefits.


That's a very silly idea really isn't it. So the state would give them money to then take some back? I am not sure if you think people who live on benefits have some kind of luxury lifestyle so they have lots of spare cash, I can assure you the overwhelming majority do not.

I think if the personal allowance was so low that even people on Universal Credit were in the tax band @philvantwo would be amongst the first to be heard.
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Roy A
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Re: Bailing out TFL and Pensioners

Postby Roy A » 17 Oct 2020, 7:58pm

Since benefitting from free bus travel when turning 60 and using my pass on London Transport buses regularly before I retired, my understanding was that Londoners holding TfL senior passes could travel on buses at anytime plus enjoying free travel on trains and tube journeys. I also understand they enjoyed concessions on Thames Clipper.

If TfL removes the concessions except for bus travel there is an option available to holders of railcards; which can be linked to Oyster Cards issued by TfL resulting in a 1/3rd saving on fares bought using the Oyster Card. This is a worthwhile saving for me when using the Tube or DLR etc.

Secondly noone claims benefits all their lives.
This is wishful thinking; I know of someone who has never worked since leaving school who is now over 60. He and his wife are not unique, I'm sure there are others.
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pete75
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Re: Bailing out TFL and Pensioners

Postby pete75 » 18 Oct 2020, 3:19pm

thirdcrank wrote:Combine your marginal rate of income tax with your NI contributions to calculate your true tax rate. Ever since the dead sheep, it's been higher than many people believe


Quite. NI used to be a fixed rate "stamp". Then earning related pensions and dole money were introduced so NI became earnings related which was fair enough. Earnings related dole and pensions have now stopped but the earnings related NI remains - a tax by another name and one which the employer also pays.

Jdsk
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Re: Bailing out TFL and Pensioners

Postby Jdsk » 18 Oct 2020, 3:23pm

pete75 wrote:
thirdcrank wrote:Combine your marginal rate of income tax with your NI contributions to calculate your true tax rate. Ever since the dead sheep, it's been higher than many people believe

Quite. NI used to be a fixed rate "stamp". Then earning related pensions and dole money were introduced so NI became earnings related which was fair enough. Earnings related dole and pensions have now stopped but the earnings related NI remains - a tax by another name and one which the employer also pays.

Yes. Is it deliberately used to keep the headline top income rate down?

Jonathan

PS: I'm repeatedly surprised by how many people think that NI is hypothecated to the NHS. Leading to "I've paid my... "AND THEY HAVEN'T! See also "road fund" and CYCLISTS!

irc
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Re: Bailing out TFL and Pensioners

Postby irc » 18 Oct 2020, 5:53pm

Paulatic wrote:
Imagine having to pay a basic rate of income tax of 35%. Do a quick calculation and see how much you are left with to spend. I don’t have to imagine it because it was a reality in the seventIes.


But don't forget the cuts in the basic tax rate were accompanied by a doubling of Vat to 15% followed by more increases later.

Looking at overall income tax VAT and NI rates I think we are not that far away.

Cutting income tax was a headline grabbed balanced out by less visible taxes.

Overall person tax probably not varied by more than a few percent over the years.

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Paulatic
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Re: Bailing out TFL and Pensioners

Postby Paulatic » 18 Oct 2020, 6:14pm

irc wrote:
Paulatic wrote:
Imagine having to pay a basic rate of income tax of 35%. Do a quick calculation and see how much you are left with to spend. I don’t have to imagine it because it was a reality in the seventIes.


But don't forget the cuts in the basic tax rate were accompanied by a doubling of Vat to 15% followed by more increases later.

Looking at overall income tax VAT and NI rates I think we are not that far away.

Cutting income tax was a headline grabbed balanced out by less visible taxes.

Overall person tax probably not varied by more than a few percent over the years.

You might well be right I think I have bitter memories because I was a young man in my prime and doing 60-70 hour weeks. 35% made a huge hole in my packet. One of the advantages of working 7 day weeks is you never have time to spend money making a purchase tax or VAT insignificant
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Jdsk
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Re: Bailing out TFL and Pensioners

Postby Jdsk » 18 Oct 2020, 6:25pm

irc wrote:Overall person tax probably not varied by more than a few percent over the years.

Screenshot 2020-10-18 at 18.28.02.png

Screenshot 2020-10-18 at 18.28.55.png

https://www.instituteforgovernment.org.uk/sites/default/files/publications/taxing-times-final.pdf

NB the second is from the PoV of the state not the individual.

Jonathan

thelawnet
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Re: Bailing out TFL and Pensioners

Postby thelawnet » 18 Oct 2020, 8:07pm

thirdcrank wrote:Combine your marginal rate of income tax with your NI contributions to calculate your true tax rate. Ever since the dead sheep, it's been higher than many people believe


Correct method is:
* Take sum of pay + employer's NI
* Divide by net pay

Employer's NI is 13.8%, income tax is 20% and employees NI is 12%. This is thus not 20%, not 32%,

1 - (.68 / 1.138) = 40.2%

Higher rate tax is then 51.0%, as employee NI goes down to 2%, while employer NI is not capped

Universal Credit and Tax Credits before create interesting situations; you get 63% of net taken away, where employer pays now 3% pension, employee 5%, both of which do not affect NI, but the 5% employee pension is exempt from NI.

So from a headline NMW of £8.72 the real wage with pension + NI is £10.03, of which the take home is £2.06, with a further 70p in pension, which is equivalent to 72.5% 'tax' (some not tax in that this is clawback of benefits paid, and benefits may still greatly exceed total tax paid) when you take into account the pension contributions, and a take-home of only 20.6% of the total salary cost.

So the government has a bit of a conflict between people not wanting to work for an extra £2/hour, and trying to cut the welfare bill.

They have been successfully working on this by increasing NMW above inflation, the effect of which is to increase pay so that fewer people are left with marginal rates where extra hours/responsibility are not worthwhile (once you earn enough to wipe out your base benefits entitlement, the marginal rate becomes much less forbidding)

Essentially at the lowest level there are lots of people who receive more from the government than they do from their employer,and the Blair approach was to pay them a big bonus on their benefits to do 16 hours a week, so that people were tempted into the labour market. This could be seen as corporate welfare in that you had people only working because of tax credits - the pay offered by the employer was not attractive enough for that on its own.

The idea since then has been how to maximise the amount of work people do by various carrot or stick approaches, i.e. either add extra incentives,or try to get people to ignore the fact that extra hours aren't cost more effective

Cyril Haearn
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Re: Bailing out TFL and Pensioners

Postby Cyril Haearn » 19 Oct 2020, 3:43pm

Whatabout vat, purchase taxes?
..
Free travel might be worthwhile in London, but in some small towns there is one bus that calls at all the schools, hospitals etc, often one could walk quicker from A to B
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