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BBC News
18-02-2025
- Business
- BBC News
Isle of Man budget 'hits middle earners hardest', MHK says
A move to reduce income tax by 1% but reset National Insurance thresholds will place an increased burden on middle earners, an MHK has Watterson outlined concerns that measures in the Isle of Man Budget 2025-26 would leave some people would be left worse Treasury Minister Alex Allinson told Tynwald moving the thresholds up would assist the lower budget included a reduction in the island's higher income tax rate coupled with a £250 increase in the personal allowance, along with a rise in the National Insurance (NI) changes. Watterson said to fund the £10m reduction in income tax, the government had "shifted the burden onto national insurance contributions", resulting in fewer people paying to cover the "same tax need", which was "fundamentally unfair".He said the group who were "hardest hit" by the budget were the "squeezed middle", and those in their 40s "should be concerned about the long term sustainability of their Manx state pensions".John Wannenburgh raised concerns over the budget's reliance on £110m from reserves, which he said was "inherently unsatisfactory".But Chief Minister Alfred Cannan said the majority of families would be "better off" next year due to the budget, and it was "putting money back into people's pockets". Lawrie Hooper said the budget would see a £20m "raid" on the NI Fund to pay for a shortfall in income from contributions to pay for state pension, certain benefits and the said Manx Care would need a budget closer to £370m, instead of its allocated £357m and the only way to meet that budget would be to "bring forward significant cuts to services".Health and Social Care Minister Claire Christian said the department would be applying an additional £4.3m, increasing the allocation to Manx Care for its mandate to £ said changes supported by additional investment, a drive for efficiencies and "openness about constraints to increased activity" provided an opportunity to "reset and lay the foundations" for future health and social care told Tynwald her department would not be bringing forward service developments next year unless more funding was told Tynwald members that the NI Fund was not being raided as contributions were going to the NHS but the fund remained the same, and the long-term impact of that remained "minimal". He said despite the need to draw down on national reserves, they were forecast to grow over the medium-term from the current £1.86bn to £2bm by budget received the backing of 16 of the island's MHKs and was unanimously supported by the Legislative Council. Read more stories from the Isle of Man on the BBC, watch BBC North West Tonight on BBC iPlayer and follow BBC Isle of Man on Facebook and X.
BBC News
18-02-2025
- Business
- BBC News
Isle of Man Budget will 'put money back in pockets'
The forthcoming budget aims to "put money back in people's pockets" in the year ahead, the treasury minister has Allinson is due to deliver the financial plan for the Isle of Man for 2025-26 during the February sitting of Tynwald on said it would "honour many commitments made last year" in terms of looking at the personal allowances, and national insurance and child benefit follows a 2% hike in the higher rate of income tax in the 2024-25 budget, while was earmarked to help cover rising costs in health. But plans to replace the the "triple lock" state pension for some Manx residents have already been removed from the budget following criticism from said the plan would "try to deliver on the Island Plan to put significant investment in things that people really care about such as infrastructure, housing, education, and health and social care".He said the measures he would outline would try to "restore the balance that has been disrupted" by the coronavirus pandemic and the war in Ukraine, which led to an increase in inflation and the cost of living, by "putting money back in people's' pockets".Tuesday's budget aimed to "cater to the needs of working people, and particularly working people with families", the minister said. 'Respond to needs' In January, Allinson outlined plans to bring forward a "double lock guarantee" for those who retired after 5 April 2019 as part of the 2025-26 budget to preserve the National Insurance (NI) the "triple lock" principle, which is currently applied, the state pension sees increases each year in line with the higher of UK CPI inflation, average earnings, or 2.5%.But a report released in October forecast the NI Fund would be exhausted by 2047-48 if that system continued to be of Tuesday's debate, Allinson said he "had to respond to the needs and the wishes" of the MHKs who had raised concerns about a lack of consultation with politicians and the public and and the timeframe of the changes. A proposed 4.1% rise in both the basic state Retirement Pension and Manx State Pension will now be put forward as part of the budget future of the National Insurance scheme will now be debated in Isle of Man Budget 2025-26 will be delivered by Allinson at 10:00 GMT on Tuesday in the Tynwald Chamber before being debated by politicians. Read more stories from the Isle of Man on the BBC, watch BBC North West Tonight on BBC iPlayer and follow BBC Isle of Man on Facebook and X.
BBC News
13-02-2025
- Business
- BBC News
Isle of Man: 'Triple lock' to stay for Manx pensioners in 2025
Catherine Nicoll BBC News, Isle of Man BBC People who receive state pensions in the Isle of Man will see their payments increase 4.1% - in line with the UK's "triple lock" principle - from April, the government has confirmed. Treasury Minister Alex Allinson had outlined plans to bring forward a "double lock guarantee" for those who retired after 5 April 2019 as part of the 2025-26 budget to preserve the National Insurance Fund. But those plans had faced criticism from several MHKs, prompting the minister to agree to separate the changes from the budget debate itself. A motion on the island's National Insurance scheme is now set to be tabled for April. A revised Manx State Pension was introduced by the Treasury in 2019 and it has been applied to those who retired after 5 April that year. The proposed changes would only have affected those retirees, with anyone receiving payments prior to that continuing to receive the UK percentage uplift to the basic Retirement Pension. While the "triple lock" ensures increases are based on the higher of UK CPI inflation, average earnings, or 2.5%, the "double lock guarantee" would be based on either Manx inflation or 2%. A report published in October forecast the island's £1.09bn NI Fund would run out by the 2047-48 financial year. But in a debate in the House of Keys on Tuesday, concerns were raised over a lack of consultation with politicians and the public over the changes and the inclusion of the measures within the budget itself. Allinson said that, after listening to the comments, it was "clear that more time is needed to ensure there is consensus around the best way to secure our NI Fund and protect pensions in the future". "I will be working with Tynwald Members over the coming months to establish a public consultation so all views can be heard and a sustainable policy agreed," he added. The proposed 4.1% rise in both the basic Retirement Pension and Manx State Pension will now be put forward as part of the Isle of Man Budget 2025-26 instead.
BBC News
12-02-2025
- Business
- BBC News
Debate on Isle of Man state pension changes separated from budget
Politicians have agreed to have "a proper debate" about proposed changes to state pensions and the future of the National Insurance Fund. Treasury Minister Alex Allinson had intended to move plans to replace the "triple lock" commitment for those who retired after April 2019 as part of the 2025-26 MHKs backed Julie Edge's call for a "full independent national debate" on the issue separate from the delivery of the annual financial plan in Tynwald next said he would support holding a separate discussion about the plans to introduce a "double lock guarantee" as a way to preserve the National Insurance (NI) Fund. The treasury minister faced criticism from some members, who said he had not followed through with a commitment made in his 2024 budget speech to engage with politicians and the public prior to any changes.A report published in October forecast the island's £1.09bn NI Fund would run out by the 2047-48 financial year. Earlier in the weekly sitting of the House of Keys, Allinson defended the plans to introduce a system that would see pensions rise by either 2% or inflation, arguing it was not discriminatory under the island equality proposals would see the scrapping of the "triple lock", which currently ensures increases based on the higher of UK CPI inflation, average earnings, or 2.5%, for anyone who retired after 5 April 2025 and qualifies for the Manx state pension. 'Unacceptable and deeply unfair' But during a House of Keys debate that lasted more than an hour, Onchan MHK Edge said the policy could "put UK state pensioners living on our island in a better position than Manx-born pensioners who have lived and worked here all their lives"."That is both unacceptable and deeply unfair and I refuse to allow this proposal to be buried in the small print of the budget," she said."A separate motion is the only way to ensure proper scrutiny and debate."Glenfaba and Peel member Kate Lord-Brennan agreed a debate was needed, and argued that the Treasury moving ahead without wider scrutiny was a "flagrant disregard for Tynwald and the residents of the Isle of Man".She said the original plan to have the changes debated and voted on as part of the budget was "bizarre" and not how major policy should be treasury minister told members he would ask for the proposals to be listed as a separate motion for debate and approval at the February sitting of TynwaldHowever a bid by Lord-Brennan to have that pensions debate pushed back to a later sitting was narrowly voted down by MHKs. Read more stories from the Isle of Man on the BBC, watch BBC North West Tonight on BBC iPlayer and follow BBC Isle of Man on Facebook and X.
