Is the Gov't right to get rid of final-salary pensions...

Off-topic
1

…for the public sector.

Personally I think they are absolutely right to do this. The private sector all but completely lost the final-salary schemes years ago. Time to bring the public sector in-line. The population is ageing and people are living longer, therefore the costs are going up at a frightening rate. And all the whinging unionists need to remember that these schemes have to be paid for from somewhere. Do these arrogant to$$ers honestly believe there is a bottomless pit of money?

Time for the public-sector to join the 21st century. Final salary pensions are unaffordable and unsustainable.

2

In principle I agree.

I would caveat with the point that many people put up with working in the public sector with poorer working conditions and lower pay than they would get for a similar role because of benefits such as, but not always; final salary pensions, greater job security, and more flexible working hours.

This could well lead to people leaving work in the public sector, not always a bad thing as many aspects of the public sector, are bloated, inefficient and seem to spend money at an alarming rate. However do we want experienced, and well trained people leaving front line services, because the carrot of a final salary pension at the end of there life of dedication to providing a public service is no longer being dangled?

3

Someone who works 20 years in a typical public sector job will end up with a pension worth about £4,500 a year - that is less than £90 a week - hardly a mint. Is a nurse who has done 20 years worth that much? That is what you should be asking.

Saying that private sector workers have been screwed by their employers so we should do the same to public sector workers just isn’t an argument.

4

Many colleagues of mine with a few years service could easily earn double what they get from the government in the private sector. One big reason they don’t at the moment is because they look forward to a relatively decent and safe pension (one they pay handsomely into every month) - one of the few incentives still left. If this is taken away, the ‘love of the job’ will only go so far for some. A number of experienced ones *will * walk, and recruitment won’t be so attractive to many more.

5

A big + 1.

6

A bigger +1

Also waxy - how can you be pleased that thousands of hard working, under paid, public sector workers will now be living on a pittance in their old age … yet be peeved off that you’re going to be £200 a month down as a result of being a high earner.

No offence intended mate … but seems to me that its no skin off your nose because it isn’t effecting you :slight_smile:

7

Mate, I’m no unionist (bit of a whinger sometimes and definitely a tosser though ;)) but I pay about £350 every month into my public sector pension scheme. To have its value dramatically devalued due to the likes of Gordon ‘Prudence’ Brown ‘mis-investing’ it is not good.

If my pension (currently set at about 15 years) goes, **** it - I’m calling on the old-boy-network and off to work for Graff or Aegis.

8

Have to agree with you Waxy. Operating a final salary scheme means that the following generations are saddled with someone else’s debt, how can that be fair?

9

So it is unfair for following generations to pay the pensions of the people who gave birth to them, kept them save and well when they were growing up, who educated them, built the infrastructure they use every day, defended the country, etc, etc?

10

There are several things wrong with the public sector final salary schemes, one of the biggest is they are not fully funded, and are simply paid out of general public purse. Another is that some people get disproportionate pay raises to the end of their workings lives to boost their pot.

As some have suggested, an average salary scheme would be a better option, or perhaps a cap on the final scheme.

Also it is a misnomer that public sector workers are paid less than the private sector. The private sector has far more people on minimum wage then the public sector.

Most private sector final salary schemes have gone, because they were unsustainable, and they had to change schemes to defined benefit schemes or scrap them. The government also keeps changing the goalposts on pensions, and the first thing Gordon Brown did was raid private pension schemes back in 1997. The addition of having to insure schemes as well has not only accelerated the closure of final salary pension but in some cases put companies into administration.

Public sector pensions need reforming, how that is going to be done is another question.

11

I agree that public sector pensions need reform, which is why, for example, new entrants to the civil service for several years have had an average scheme with pension payable at 65 and higher contributions. However, most of what you have said is right winf press propaganda and misinformation. For example -

Of course public pensions (including the state pension) are not fully funded. Would you be happy paying tax now to pay pensions to people after you are dead? That is the alternative if you had fully funded public sector pensions.

I have never known anyone get a promotions just before retirement to boost pension. It might happen to the bosses, but I have yet to see it in 30 years of public service at low levels and through middle management.

Public sector workers traditionally have always got paid less than the private sector. That has changed in recent years for three reasons - the private sector has been screwing its workers, the public sector has sold off all the low pay, low skill manual jobs to the private sector. There are fewer public sector jobs on minimum wage becasue no one in the public sector is a cleaner or porter or security guard for example. Thirdly, since we took ownership of banks, bankers in those companies count as public sector workers in the official pay statistics.

In changing pension schemes the private sector has drastically reduced the amount that it pays into pensions. It is not like the old system was unsustainable and they now pay the same as they were into the new schemes. Instead typical contributions from employers have reduced from 15% to about 7%.

As for Gordon Brown’s raid, that was in response to a call from the market authorities to close a loophole that was distorting equity markets. The amount involved it trivial compared with the amounts the employers have taken out of pensions since 1997. It is almost certain that the Tories would have closed that loophole if they had won in 1997.

12

If they bring in average salary pensions, instead of final salary pensions, will they allow for inflation somehow? Thirty years ago, I was earning just over £1 per hour. Allowing for inflation, I’m probably earning about the same now!

Since joining this local authority fire & rescue service, nearly twenty years ago, I have paid 11% of my wages into the firefighter’s pension scheme. I am planning on doing that until I have worked thirty years; I will then be sixty years old.

It is only recently, with the age discrimination laws, that firefighters have been able to work beyond the age of 55. I am going to need to keep myself very fit in order to stick with my plan.

The firefighter’s pension scheme has never been an invested fund. Since it was created, the money that was paid in by working firefighters was paid out to the retired firefighters. In the early days of the scheme this suited the employers well because retired firefighters would usually be dead very soon after retiring, if they even lasted that long. There were more payers than payees and the scheme was making a profit.

This profit (a proportion of our wages/pensions) was used by the employers to build new fire stations and buy new equipment.

These new fire stations are now old fire stations and in need of renovation or replacement. However, where fire stations are now being relocated to major road junctions to replace the old city (or town) centre stations, and those city centre sites are being sold to developers, are the massive profits from these sales coming back into our pension scheme?

You can guess the answer.

They have already messed up our pension scheme enough. It is still a carrot (as someone has astutely posted), which keeps us in the job but that carrot is in danger of becoming rotten.

I, for one, will vote yes to strike over my pension if they come for it.

13

Don’t blame you in the slightest. I don’t have that option … at the moment !

14

I never said I was, but I do think that bring final salary pensions to a halt in the public sector makes sense, because as I said originally with an ageing population and the fact that people are living longer it is unaffordable.

Also I think you have completely twisted what I said about child benefit, if you read back as to what I originally wrote, I said I totally understood that as a tax-payer there was going to be an impact on me to help get this country on the straight and narrow. I know this and accept this. My point was that whilst I accept this, I would be extremely pee’ed off if the Government took a fairly easy route, by removing child benefit from higher-rate tax-payers, but did not put the thought and energy in to cleaning up the benefits system from wasters and spoungers who have no intention of doing a day’s hard work and get everything given to them on a plate

15

The moral of the story is, if you’re under 30 contract out of your S2P else you’ll end up with nothing. By the time I retire there wont be a pension beucase you old folks will have drained it dry. :stuck_out_tongue:

I’ll be clutching onto my cleverly invested S2P.

16

Same here, opted out of the pensions cheme… since it changes all the time plus it onkly goes up to about %15 after about 20 years of putting money in, considering years ago people sued to join 1 company and kinda work for it until retirement… tehse days most people change jobs after 5 years or less, I hope by the time I do retire to do it somewhere nice and sunny… and I hope that I will have neough money put on the side or even a little business to manage in old age.

17

Ditto - use the pension to buy a boat or something.

The joys of SIPPs.

18

Are MP’s classed as " Public sector workers " and will the changes affect their pensions ?

19

They have their own scheme which doesn’t count as a public sector pension.

20

What a shocker. :confused: