Confronting Inequality in the UK Pension System
Article 7: Rebalancing Pension Equity
The articles are not intended to offer financial advice. Readers are encouraged to consult a qualified financial advisor for guidance.
Chagos—Global Security Threat
Ceding the Chagos Archipelago to Mauritius Threatens Global Security
Published 17th January 2025
The Chagos Archipelago, particularly Diego Garcia, is a cornerstone of global security. Housing a vital Anglo-American naval and strategic base, it plays a pivotal role in regional stability and international efforts, including U.S. Space Operations. This base is essential to counter Chinese and Russian advances in weaponising space through the development of counterspace technologies.
Since October 2024, I have been leading the charge against Keir Starmer’s decision to cede the Chagos Archipelago to Mauritius—an ally of China—without proper parliamentary debate. This hasty action risks compromising UK and U.S. security interests. Initially, the deal was rejected by a new Mauritius government, but concerns remained about a revised agreement being finalised during recess periods to bypass parliamentary scrutiny and avoid intervention by Donald Trump, the incoming U.S. President.
The commentary ‘Chagos Archipelago Betrayal! and Compensation’ incontrovertibly demonstrated that Mauritius’s territorial claim is unfounded. Its argument hinges on the false premise that historical administration equates to ownership. This principle has no legal or fiduciary basis, rendering Mauritius’s claim invalid and the UK’s sovereignty intact.
Reports that Keir Starmer is now consulting with President Trump offer a glimmer of hope. However, the Foreign Office is reportedly working urgently to resolve outstanding issues.
I appeal to American readers: Share this message on X and ensure Donald Trump’s team is fully aware of Mauritius’s illegitimate claim. Together, we can halt this farcical transfer.
Anthony Royd
A Global Security Risk: The Peril of Ceding the Chagos Archipelago
The geopolitical stakes surrounding Diego Garcia extend far beyond regional considerations, as the island’s strategic location is pivotal to maintaining global security and countering the escalating threat of space weaponisation by adversarial powers.
Strategic Importance of Diego Garcia
Diego Garcia’s significance cannot be overstated. A Chinese military presence near this U.S. base would jeopardise American dominance in the Indian Ocean and undermine critical space operations. Equipped with eavesdropping and communications-jamming systems, a Chinese garrison could neutralise U.S. capabilities, compromising both regional and global security.
Evidence of Space Weaponisation
Counterspace Technologies
China and Russia are advancing counterspace capabilities, including anti-satellite (ASAT) missiles, signal jamming, and spoofing. Russia’s development of space-based systems targeting satellites in low Earth orbit exemplifies this threat.
Cyberattacks
Russia’s cyberattack on satellite communications at the onset of the Ukraine invasion in February 2022 highlights the strategic importance of space assets in modern warfare.
Satellite Weaponisation
U.S. intelligence accuses Russia of launching satellites capable of attacking others in orbit, further confirming militaristic intentions.
Strategic Partnerships
Despite advocating for outer space arms control, China and Russia pursue militarisation under the guise of peaceful cooperation, fuelling concerns about a looming arms race.
Broader Implications
The efforts by China and Russia to militarise space threaten not only regional stability but also global security. The ambiguity of their dual-use technologies complicates oversight and increases the risk of conflict in space. These developments demand vigilance and decisive action to maintain the balance of power and protect satellite-dependent systems.
In summary, the Chagos Archipelago is not just a geopolitical dispute; it is a linchpin in the broader struggle against space militarisation. The stakes are too high to allow this vital territory to fall into hands that threaten global security, or Is It Me!
Stand with Anthony Royd to safeguard the Archipelago and preserve international stability.
Confronting Inequality in the UK Pension System
A Call for Fair and Lasting Reform
by Anthony Royd
Article 7: Rebalancing Pension Equity
Published 9th January 2025
A Matter of Fairness
In his third pension article, Anthony Royd identified a critical disparity in the UK’s pension system: public sector employees benefit from far more generous pensions compared to the basic state pension, which many private sector retirees must rely on.
This discrepancy raises serious questions about equity and fairness, as public sector pensions are primarily funded by government contributions, while private sector workers often face less favourable alternatives. Addressing this imbalance is essential for creating a fairer, more sustainable system.
The Triple Lock Controversy and State Pension Inadequacy
The UK’s basic state pension system pales in comparison to other G7 countries. With the full state pension currently set at £11,500 annually—and even less for retirees over 75—it leaves millions of pensioners far below the relative poverty threshold of £20,400.
In comparison
Germany replaces approximately 50% of pre-retirement income.
France achieves around 75%.
Canada provides about 60%.
By contrast, the UK’s replacement rate has been failed by the Triple Lock, generating a paltry 28.4%, well below the OECD average of 58.6% and the EU average of 63.5%. This systemic inadequacy forces millions of retirees into financial hardship, while public sector workers enjoy pensions that often replace 50%–75% of pre-retirement income in addition to the state pension.
Disparities in Public Sector Pensions
The advantages afforded to public sector employees underscore the inequities in the UK pension system. Below are examples of public sector schemes:
Teachers’ Pensions
Scheme: Defined benefit, calculated based on career average salary and years of service.
Payout: Teachers retiring after 30 years receive approximately 60% of their final salary.
Civil Service Pensions
Scheme: Defined benefit, typically with accrual rates of 1/40th or 1/50th of final salary per year of service.
Payout: Full-career civil servants receive pensions equivalent to 50%–70% of their pre-retirement income.
NHS Workers’ Pensions
Scheme: Defined benefit, often accruing at 1/80th or 1/60th per year of service.
Payout: After 30 years, NHS staff receive 60%–75% of pre-retirement income.
Steps Toward Reform: Rebalancing Public and State Pensions
Public Sector Pension Reform
Reforming public sector pensions is key to achieving equity. Proposed measures may include:
Adjusting Contribution Rates
Increasing employee contributions to reduce the burden on taxpayers while maintaining retirement security.
Capping Pension Payouts
Aligning public sector pensions with private sector standards by capping payouts at ratios proportional to state pension replacement rates.
Introducing Hybrid Models
Replace public sector pension schemes with an enhanced state pension system, supplemented by a hybrid approach that combines defined benefit (providing predictable retirement income) and defined contribution (based on investment performance) elements.
This would ensure a balanced approach to equity and sustainability.
State Pension Reform
Transforming the state pension system is equally critical. Key actions include:
Increasing State Pension Levels
Raising the basic state pension to between 60% and 70% of pre-retirement income, aligning it with international benchmarks and ensuring fairness across all demographics.
Eliminating Disparities
Addressing the injustice faced by individuals over 75, who receive lower pensions despite contributing to National Insurance for 50 years, requires a universal pension system based solely on contribution years rather than date of birth.
The Women Against State Pension Inequality (WASPI) campaign highlights another pressing issue of pension disparity. It was established to address grievances stemming from changes to the state pension age for women born in the 1950s.
Their complaint focuses on the abrupt transition of the pension age from 60 to 65, and subsequently to 66, as initiated by the 1995 Pensions Act and accelerated by subsequent legislation. Inadequate communication of these changes left many women unprepared, leading to significant financial hardship. Investigations have identified maladministration in how these reforms were handled, further fuelling WASPI’s demands for government compensation—demands that remain unmet despite widespread public and parliamentary support.
Introducing a Defined Benefit Scheme
Transitioning the state pension to a Defined Benefit Scheme funded by National Insurance contributions, with funds ring-fenced exclusively for pension payments. This approach would reduce reliance on general taxation and ease intergenerational fiscal pressures.
Economic and Social Benefits of Reform
Equity Across Demographics
Raising the state pension replacement rate would eliminate the need for disproportionate public sector schemes, ensuring fairness for both public and private sector retirees.
Sustainability
Ring-fenced National Insurance contributions would create a more stable and transparent funding system, safeguarding pensions for future generations.
Economic Stimulus
A fairer pension system would boost consumer spending, reduce poverty, and create long-term economic growth.
Intergenerational Justice
Rebalancing pensions would reduce the financial strain on younger taxpayers, fostering a more equitable society.
A Path Toward Pension Equity
The UK’s pension system is in dire need of reform to address glaring disparities between public sector pensions and the state pension. By aligning state pension levels with international standards and reforming public sector schemes to reflect the realities faced by private sector workers, policymakers can create a fairer, more sustainable system.
Increasing the state pension replacement rate to 60%–70% of pre-retirement income would ensure retirees receive adequate support while alleviating the financial burden on taxpayers.
A comprehensive overhaul is essential to delivering equity, sustainability, and security for all UK citizens.
Rebalancing Pensions: A Fair and Sustainable Future for All Retirees
The UK’s pension system disproportionately favours public sector employees, leaving private sector workers and state pension recipients at a significant disadvantage.
Reforming both public sector pensions and the basic state pension is essential to achieve equity.
A key solution lies in transitioning to a Hybrid Model that replaces bloated public sector pension schemes with a fairer system. By introducing a combination of defined benefit (predictable retirement income) and defined contribution (investment performance-based) systems, underpinned by an increased state pension, the UK can balance affordability and equity.
Additionally, raising the state pension to align with international benchmarks, capping excessive public sector pensions, and funding pensions through ring-fenced contributions will create a more just, sustainable, and economically beneficial framework.
The time to act is now, to secure a fairer future for all retirees, or Is It Me!
Next in the Series: Securing Fairness: Transforming UK Pensions for All Retirees
Join Anthony Royd as his final article presents a comprehensive solution—a Hybrid Pension Model that merges fairness and affordability by replacing bloated public sector pensions with a balanced system. Coupled with a Universal Pension Credit, with a Double Lock for vulnerable groups.
