Can I state a few obvious points I believe to be correct?
- The UK DWP is holding a pension fund where almost all UK residents are putting contributions in;
- The UK DWP is paying the pensions to those that matured their annuity, wherever they are on the planet;
- There are intra-EU arrangements that avoid double taxation and introduce further compliance;
- The existing legislation allows a UK taxpayer to take the whole annuity as a lump sum to reinvest in another financial instrument.
I’m sure there are other subleties and this is a simplified scenario, and I’m sure that if I’m grossly mistaken I’ll be taken to task, but looking at the above I am really pushed to the limit of human comprehension to try and find a way to put Scottish taxpayers’ pensions at risk with an Independent Scotland.
Scotland will be responsible for paying pensions, as every independent country does, but the money will either come from a Scottish public pensions fund, paid by current contributions and stocked with the annuities at point 4, or from the rUK pension fund, where Scottish taxpayers’ contributions are held.
A third way could see the rUK pension fund handing over all the contributions from Scottish taxpayers to the new Scottish pension fund, but that would be a financial shock that could see UK finances suffer badly in already difficult times.
That fund, bolstered by Brown’s raid on private pensions funds, is offered as a guarantee against a number of state bonds. An overnight capital reduction of ~10% would be a massive blow.
It’s therefore beneficial for both parties not to put obstacles and upset a situation that is extremely simple and straightforward.
Any other option would be unnecessarily complicated, or unthinkable.