Has The Country Gone Crazy?

No, I am not talking about Indonesia; I am talking about the United Kingdom. I have just returned from a short holiday there and was able to find more reasons for staying overseas! Here are some of the stories that were hitting the headlines while I was there:

Mother allowed underage daughters to have babies

Not so many years ago in the UK an unmarried mother would have faced great hardships if not supported by her family. Today, under the ‘progressive’ welfare state large amounts of money are handed out by way of various benefits to families who cannot support themselves. Consequently a particular family of a mother and her three young unmarried daughters, all with babies, were reported to be enjoying an income from the state of several hundred pounds a week, more than many people could earn.

The ‘refugee’ child smuggling racket

The UK’s generous handouts have not gone unnoticed by foreign scam artists. It was reported that hundreds of children were being smuggled into the UK by African syndicates in order to claim benefits from the state. Much of the lucrative income is allegedly returned to the syndicates in Africa. It seems that the scam letter writers have found a new source of income. Massive fraud is suspected but the authorities appear powerless to combat it.

Bibles to be banned in some hospitals
Some hospitals in the UK are proposing to ban bibles for risk of offending ethnic minorities. Interestingly, the move has been criticized by the same ethnic minorities the proposal was intended to please.

Pensionable age to depend on social class?

Every western country is struggling with the problem of funding retirement pensions for ageing populations. One proposal that made the headlines while I was in the UK was that people should retire at an age depending on their social class. Those who left school early and had a shorter expected life span should be able to draw their pensions at the current retirement age of 65 but those who followed higher education and had a longer life expectancy should not be able to draw their pensions until 70. There is a certain element of logic in this in that those who left school early have been contributing longer to the state scheme whilst those who were ‘privileged’ to go to university started working and contributing much later. However laudable, such a proposal would be extremely difficult to implement so it will no doubt fall by the wayside.

Britain is not alone with its follies

Despite the above the UK in many respects is more productive than many of its European counterparts. In parts of Europe workers cling even more tightly to benefits they consider their birthright. This in turn increases the tax burden and discourages job creation. Politically, Europe is currently in turmoil following rejection by the French and Dutch of the proposed new constitution. The rejection was seen as a wake-up call for politicians who had been promoting changes without listening to the people. But it also meant that long-needed reforms would now be harder to push through. Workers will fight to retain their 35-hour weeks oblivious to the fact that those in other countries such as India are prepared to work 35-hour days, and for much less!

What has all this to do with Bali?

For long term expats in Bali the news items referred to may just be of passing interest. But there are implications that affect us all. Budgets in western countries are under increasing pressure due to ageing populations and excessive welfare handouts. It means that should we return to our home countries in later life there will be few, if any, state benefits. Survival may depend on friends, family or charities if we have not made adequate provision for ourselves. Long term private care now costs at least US$3,000 a month. To keep this funded without dipping into capital would require a lump sum of around US$750,000. So we may have to keep open the option of seeing out our golden days in Bali. At least it’s warmer than the UK!

Colin Bloodworth is a senior adviser with Financial Partners International. The views expressed are his own. If you have any questions you may contact the writer at 021 520 8099 or