All the industries in the UK are on the decline and most UK companies are being either sold off, shut down or are being owned (for a long time) by foreign companies.
It may take several decades for the UK to come back from this.
I would recommend interested HNers to read up on the State Pension Triple Lock; and the various income tax cliff edges as some key examples.
With respect to the income tax, it is possible for higher earning (not by US standards) employees to receive a bonus and actually take home less money than before they received the bonus.
The triple lock is a politically motivated policy which always grows the state pension (given to essentially all UK citizens and anybody that ever worked there for more than 3 years) at a rate faster than earnings grow or faster than the economy grows. It will subsume the entire government budget.
Given the extremely high cost of energy, and housing in many places, younger people also seem to be opting out entirely. Disability payments the government pays are increasing at a rapid rate. (1 in 13 of the population are currently receiving this benefit).
1. As you say, an aging population has placed the entire country into a gridlock - the pensions system as it stands is ridiculous and unsustainable. Unfortunately, it is an almost immediate political suicide to even attempt to reform it. Young people are disillusioned and wield little monetary or political power. The old generation has all the cards, and are actively destroying their children's future for their own short term benefit. They have mortgaged their children's future, which they won't get to see, for the short period of time they still have remaining. 2. There's no investment culture in the UK. Literally everything and everyone is rent seeking. Want a retirement? Buy property and rent it out. Want a pension? Pension funds just buy gilts - government bonds. Very little money goes into productive assets. This creates a vicious cycle where money is simply siphoned away from the little productivity that remains to an ever growing number of rent seekers.
There's no easy way out of this. One generation will effectively have to give up their welfare, but nobody wants to do this (understandable). The UK cannot afford to be the welfare state it wants to be.
It can be done over a period of time. Canada moved from a non-funded pension model like the UK currently has, to a partially funded model which currently has over $731 billion in assets.
They began this change in 1999. If they hadn't made that change in direction they'd be in a much worse situation today.
It's possible to change from one system to another, if a government is able to look much further ahead than its own term in government.
With the Canadian model, your payments out at the end are tied to what you put in. Which is not quite the case in the UK, which allows extremely low payments in for just 10 years to get a very high amount out indefinitely.
The British government must take the same path the Canadians took.
To be fair what you get is proportional. If you are an NI payer for 4 years then you only get 4/32 of the state pension.
Having said that the triple lock is a ridiculous idea. The trouble is people are loss averse so it is really hard to take away things people have got used to.
Anybody who ever worked in the UK can do it and you don’t need to have ever been a citizen.
There are adverts on Irish radio about it quite often.
It’s an absolutely terrible deal for the British government when you consider how high the state pension annual payout is.
I live in another country right now and I do it myself!
As long as you have less than £8,000 in the bank.
What are you referring to here? Higher rates of income tax are only taken on the money earned over the band. So If you earn £50,271, you pay 20% on £50,270 and 40% on £1.
Are you referring to some other kind of tax then?
The marginal tax rate for 100k -> 125k is 60% (due to losing the ~£12k tax free allowance)
"Your personal allowance goes down by £1 for every £2 that your adjusted net income is above £100,000. This means your allowance is zero if your income is £125,140 or above."