Public Sector Pensions - Today's Times

[sadoldgit]

My heart bleeds for them.

 

If the Tories achieve one thing, and one thing only, I hope it is to sort out the balance between the public and private sector. The public sector is too big and too cushy. It's time that it was dragged into the real world.

 

They won't like it and they'll strike, but in the end it'll be a price worth paying to sort it out.

 

Abolutely, and while they are at it they can standardise the pay and perks too so a massive pay rise for me with a company car, mobile phone and laptop.

 

We do live in the real world mate and trust me, the private sector pays better and offers better perks - unless you count free paper clips as a perk.

[View From The Top]

Dense.

 

Its a outdated myth that all (or even many) civil servents are poorly paid, the fact that some still peddle this tripe I can only put down to self-interest. In reality teachers are well paid (starting at £22k p/a) to educate everyone's children - and even after the proposed (and long overdue) reforms to public sector pensions most will still be in a infinitely better position upon retirement to the vast majority of private sector employees. If you are really arguing that private sector workers bringing up family's on a income of £6 or £7 per hour should have found heaps of spare cash from somewhere to build up a sizable pension pot for themselves then you need to get in touch with reality at some stage sunny Jim.

 

Don't tell me this is all Tory propaganda - my own sister recently retired at 55 with a comfortable workplace pension after a lifetime of fairly well paid, secure, and to be frank relatively pleasant work within the NHS - a fate many hard grafting factory workers and the like could only dream of.

 

I know its fashionable for civil servants to be referred to as 'key workers' these days - but it seems to me the the poor sods who work themselves to the bone generating the wealth that actually pays for our grossly inflated public sector are the real heroes of British Labour.

 

But of course no bugger cares about them.

 

If you think £22k is well paid then you are living in LaLa land.

[Jonnyboy]

I work in the private and my partner the public, neither of us can afford a pension.

[Whitey Grandad]

Espeicially that comical one posted by the Grandad! Keep it up old boy!

 

Take your pick:

http://www.thisismoney.co.uk/money/news/article-1611158/25-of-council-tax-spent-on-pensions.html

http://www.telegraph.co.uk/news/uknews/1508474/26pc-of-council-tax-goes-on-public-pensions.html

http://www.thisislondon.co.uk/news/article-23491631-how-a-quarter-of-council-tax-goes-towards-town-hall-workers-pensions.do

http://www.taxpayersalliance.com/waste/2011/05/rising-cost-council-pensions-eating-local-government-budgets.html

 

All from a couple of years ago.

[CHAPEL END CHARLIE]

If you think £22k is well paid then you are living in LaLa land.

 

I live in the real world.

 

A newly qualified teacher in their first job gets £22k - this can rise to c £40k or more according to the NUT.

 

And yes I do think that's quite a lot of money, don't you ?

[LGTL]

I live in the real world.

 

A newly qualified teacher in their first job gets £22k - this can rise to c £40k or more according to the NUT.

 

And yes I do think that's quite a lot of money, don't you ?

 

It may rise to that after about 10-15 years if you're lucky. With added responsibilities obviously.

[CHAPEL END CHARLIE]

It may rise to that after about 10-15 years if you're lucky. With added responsibilities obviously.

 

I stand at a workbench 8+ hours a day in a grim factory working bloody hard for a firm that offers no (lets repeat that NO) pension at all to most of its staff and pays something perilously close to the minimum wage. This company could go bust at any time and I expect to have to work well into my 70's - if I live that long.

 

Please explain why I should sympathize with civil servants, who are any which way you look at it are still massively better off than I will ever be.

Edited 1 July, 2011 by CHAPEL END CHARLIE

[View From The Top]

I live in the real world.

 

A newly qualified teacher in their first job gets £22k - this can rise to c £40k or more according to the NUT.

 

And yes I do think that's quite a lot of money, don't you ?

 

No, I don't and frankly I'm surprised anyone does.

[View From The Top]

I stand at a workbench 8+ hours a day in a grim factory working bloody hard for a firm that offers no (lets repeat that NO) pension at all to most of its staff and pays something perilously close to the minimum wage. This company could go bust at any time and I expect to have to work well into my 70's - if I live that long.

 

Please explain why I should sympathies with civil servants, who are any which way you look at it are still massively better off than I will ever be.

 

Get a better job then, that seems to be the mantra of the private sector.

[View From The Top]

Take your pick:

http://www.thisismoney.co.uk/money/news/article-1611158/25-of-council-tax-spent-on-pensions.html

http://www.telegraph.co.uk/news/uknews/1508474/26pc-of-council-tax-goes-on-public-pensions.html

http://www.thisislondon.co.uk/news/article-23491631-how-a-quarter-of-council-tax-goes-towards-town-hall-workers-pensions.do

http://www.taxpayersalliance.com/waste/2011/05/rising-cost-council-pensions-eating-local-government-budgets.html

 

All from a couple of years ago.

 

So the government are lying then when they say that the LGPS is in credit and will be for at least the next 25 years?

[CHAPEL END CHARLIE]

Get a better job then, that seems to be the mantra of the private sector.

 

As someone who has obviously never gotten his hands dirty in his life I expect you think that's a simple task for a working man in the midst of a major reccesson.

 

But yes I'm looking for some cushy civil service posting.

[LGTL]

I stand at a workbench 8+ hours a day in a grim factory working bloody hard for a firm that offers no (lets repeat that NO) pension at all to most of its staff and pays something perilously close to the minimum wage. This company could go bust at any time and I expect to have to work well into my 70's - if I live that long.

 

Please explain why I should sympathize with civil servants, who are any which way you look at it are still massively better off than I will ever be.

 

Teaching is a postgraduate profession, so their salaries need to be compared like for like. I've graduate friends in the Private sector earning £50k + a year at 24, with all the perks that go with it including final salary pensions. You shouldn't sympathise but you should probably understand why teachers might be earning more then minimum wage and expect a decent pension, just like their equivalents are getting in the private. Well the ones I know anyway.

Edited 1 July, 2011 by LGTL

[View From The Top]

As someone who has obviously never gotten his hands dirty in his life I expect you think that's a simple task for a working man in the midst of a major reccesson.

 

But yes I'm looking for some cushy civil service posting.

 

Muppet.

 

I've been there, seen it, done it. I then used my brain and got myself out of it.

 

Try it.

[CHAPEL END CHARLIE]

Teaching is a postgraduate profession, so their salaries need to be compared like for like. I've graduate friends in the Private sector earning £50k + a year at 24, with all the perks that go with it including final salary pensions. You shouldn't sympathise but you should probably understand why teachers might be earning more then minimum wage and expect a decent pension.

 

I had some good teachers and some bloody terrible ones - they all went to university. No one I know earns anything like £50k a year, I don't know how you could even spend that much money - although View from the Top clearly sees that kind of sum as petty change.

 

Why do you think only civil servants deserve a 'decent pension' ? One rule for them and another for the rest of us ?

[CHAPEL END CHARLIE]

Muppet.

 

I've been there, seen it, done it. I then used my brain and got myself out of it.

 

Try it.

 

You've never done a real days work in your life sonny - you don't even know what it means.

[dubai_phil]

Having spent 3 weeks back home I watched the telly and remembered all the things that made me dislike being home.

 

Simply put what got me angry was some muppet female teacher bemoaning her lot in life. Oh dear, she has to work to 66 now. Hello, what happened to EQUALITY?

 

Or the simply fact in the papers that the head of the Union running the strike gets 27k a year in Pension contributions, compared to the Teachers on 22k a year?

 

Or the very, very VERY basic simple fact of life - Everyone I met in the Private Sector has spent the past 4 years being screwed on No pay rises or in most cases pay CUTS, their Pensions have massive holes in them so they have to work until they are 90 or so IF they can keep their job OR their employer doesn't go bust.

 

Hell, there is a recession. You lot were all guilty with your big mortgages and credit card billls and stupid Fire Station Centres & Aircraft Carriers you couldn't afford and that moron raiding the pension funds and selling off your Gold for peanuts.

 

Don't go on strike, go find that Scottish imbecile and get HIM to pay your pension personally - HE's the one who fecked it all up

[sadoldgit]

There is an awful lot of b*ll*cks spouted on this thread. I have worked in both the public and private sector and I can tell you that life in the public sector is so much harder nowdays.

 

I manage 14 people, I work 10 hour days, I have trouble getting leave because I can't get staff to act up for me, I earn less than the national average wage, there is no overtime available so I don't get paid for the extra hours I work, my office is undermanned and those who do come in end up going off sick because of the stress, there is a pay freeze, there is no opportunty for promotion. No I didn't go on strike but after reading this thread I wish I had.

 

I am earning half or what I did ten years ago with more stress to do what? To serve the public. The very public now who are saying that the public sector have got it easy.

 

What you have to understand is this. You want your bins cleared, your children taught, your streets safe from crime right? None of these things actually create a cash flow. They are dependant on Governement funding. They are essential for the effecient running of our society yet those in the private sector think they are paying too much for these services. The truth is that they are not paying enough.

 

I don't agree with strikes but the people who went out yesterday have got a grievance. If someone signs up for a contract they expect that to be honoured. The Government can't suddenly change someone's pension scheme after 20 odd years of service. Where does that happen in the public sector?

 

I am all up for equality. BUt that applies to both sectors. You want change fine, but for new starters not people who signed up for a package years ago.

[Hedgehog]

I stand at a workbench 8+ hours a day in a grim factory working bloody hard for a firm that offers no (lets repeat that NO) pension at all to most of its staff and pays something perilously close to the minimum wage. This company could go bust at any time and I expect to have to work well into my 70's - if I live that long.

 

Please explain why I should sympathize with civil servants, who are any which way you look at it are still massively better off than I will ever be.

 

Well just get a job in the public sector then, take a job in nursing, teaching etc. as it loooks like anyone can get such a job. Yes your job may be hard/work long hours/work to 70. Why do it if you could get a cushy job in the public domain. Don't think your arguement holds much ground.

[badgerx16]

Don't go on strike, go find that Scottish imbecile and get HIM to pay your pension personally - HE's the one who fecked it all up

Of course Nigel Lawson & Norman Lamont had nothing to do with it, creating the environment, and then encouraging companies to take 'contribution holidays' from paying their dues into private sector pension schemes ?

 

http://www.opalliance.org.uk/decline.htm#5billion

 

http://www.ipe.com/news/uk-pension-schemes-took-e26bn-in-contribution-holidays_6717.php

 

http://business.timesonline.co.uk/tol/business/article1071505.ece

[Wade Garrett]

Having spent 3 weeks back home I watched the telly and remembered all the things that made me dislike being home.

 

Simply put what got me angry was some muppet female teacher bemoaning her lot in life. Oh dear, she has to work to 66 now. Hello, what happened to EQUALITY?

 

Or the simply fact in the papers that the head of the Union running the strike gets 27k a year in Pension contributions, compared to the Teachers on 22k a year?

 

Or the very, very VERY basic simple fact of life - Everyone I met in the Private Sector has spent the past 4 years being screwed on No pay rises or in most cases pay CUTS, their Pensions have massive holes in them so they have to work until they are 90 or so IF they can keep their job OR their employer doesn't go bust.

 

Hell, there is a recession. You lot were all guilty with your big mortgages and credit card billls and stupid Fire Station Centres & Aircraft Carriers you couldn't afford and that moron raiding the pension funds and selling off your Gold for peanuts.

 

Don't go on strike, go find that Scottish imbecile and get HIM to pay your pension personally - HE's the one who fecked it all up

 

You've been in the sun for too long. DOn't judge us from your tax-free work haven in the sun. At least the people you are slagging off pay income tax here.

[dune]

Don't go on strike, go find that Scottish imbecile and get HIM to pay your pension personally - HE's the one who fecked it all up

 

Well said.

[bridge too far]

You've been in the sun for too long. DOn't judge us from your tax-free work haven in the sun. At least the people you are slagging off pay income tax here.

 

And what DP chooses to ignore about the head of one of the teachers' union's pension contributions is this:

 

1. The union members, via the union's trustees, vote to approve or disapprove union officials' salaries and pensions, just like shareholders approve or not the salaries of the directors of those companies. Their salaries and pensions come from members' subscriptions, not from the taxpayer.

 

2. Top executives of private companies get HUGE pension pots when they retire - with contributions of something in the order of 25% from the companies employing them.

 

We should all get decent pensions - if we don't the taxpayer will have to pick up the tab caused by an increase in pensioners claiming pension credits. Don't be fooled by the divide and rule policies of this ConDem government.

[Verbal]

You've been in the sun for too long. DOn't judge us from your tax-free work haven in the sun. At least the people you are slagging off pay income tax here.

 

That would be bankrupted and bailed-out tax-free work haven in the sun.

[Thorpe-le-Saint]

I stand at a workbench 8+ hours a day in a grim factory working bloody hard for a firm that offers no (lets repeat that NO) pension at all to most of its staff and pays something perilously close to the minimum wage. This company could go bust at any time and I expect to have to work well into my 70's - if I live that long.

 

Please explain why I should sympathize with civil servants, who are any which way you look at it are still massively better off than I will ever be.

 

Surely you were not forced into taking such a crappy job?

 

I didn't just jump head first into teaching, I weighed up the pros and cons first between that or working for soulless company. This always amazes me about the private sector, it's as if someone shoved a gun at your temple and frog marched you into taking a job with no pension scheme/low chances of progression.

 

You knew the deal when you signed up as I did with teaching: mediocre pay for a university leaver but we were to be rewarded in retirement.

[dubai_phil]

What you have to understand is this. You want your bins cleared, your children taught, your streets safe from crime right? None of these things actually create a cash flow. They are dependant on Governement funding. They are essential for the effecient running of our society yet those in the private sector think they are paying too much for these services. The truth is that they are not paying enough.

 

I don't agree with strikes but the people who went out yesterday have got a grievance. If someone signs up for a contract they expect that to be honoured. The Government can't suddenly change someone's pension scheme after 20 odd years of service. Where does that happen in the public sector?

 

.

 

Bit less stressed today having slept off the yuk flight home.

 

Soggy hits the bit that I actually agree with. The fact is that the "Public" need "Services" & that local & central Government have to provide that out of taxes (or as is the case down here) in fees.

 

The problem is that the amount spent on these support services seems to have had little or no control. for example, how are the provision of these services priotritised? What is the most important? Is it getting the bins emptied or is it bombing Libya? Is it employing "people facing care workers" or employing expensive managers who only set targets and add nothing to the levels of actual service at the front line (like that Baby whatever woman that got her unfair dismissal claim recently)

 

Should the people who have worked in the public sector for 15 or more years get screwed over on their contracts because some 10,000 or so "new" quasi political roles were creaated. Should Department heads get salaries higher than the Prime Minister when the teachers are getting screwed or my mate who helps maintain Housing Association promperties gets his pay cut by 33%?

 

The British Army is smaller than the US Marines. Yet it has more than ten times the number of Officers and some 80% of those drive desks. Is that REALLY what your money should be spent on?

 

The politics is actually very simple. There are a great many great people in the Public Sector doing hard and stressful jobs. But everytime someobody tries to look for waste (The MOD procurement processes), profligacy (Council Credit Cards), overpaid useless management (Baby P example) they are hounded down by saying "Sop the cuts".

 

The service providers at the frontline need the help and support. The system never lets that happen as politics and vested interests get in the way.

 

Want to stop having to cut Teachers pensions? Easy, fire the entire top level of Civil Servants & Government staff and let the people below them do the work. Bet that someone somewhere can find the 80:20 rule - 80% of the money paid as salaries etc goes to the top 20% of "managers"

 

So the situation you now have is that eliminating waste always hurts the public facing staff as the top Turkeys would never vote for Christmas. And unfortunately that has been the same since before Harold Wilson & Jim Hacker et al, not just the Scottish Imbecile. he just let go of the reins even more.

[dubai_phil]

And what DP chooses to ignore about the head of one of the teachers' union's pension contributions is this:

 

1. The union members, via the union's trustees, vote to approve or disapprove union officials' salaries and pensions, just like shareholders approve or not the salaries of the directors of those companies. Their salaries and pensions come from members' subscriptions, not from the taxpayer.

 

2. Top executives of private companies get HUGE pension pots when they retire - with contributions of something in the order of 25% from the companies employing them.

 

We should all get decent pensions - if we don't the taxpayer will have to pick up the tab caused by an increase in pensioners claiming pension credits. Don't be fooled by the divide and rule policies of this ConDem government.

 

And in MANY cases this is as criminally wrong as the top end waste in "The Public Sector". Again, was it better to waste all that money on those National Fire Station Centres (not the concept but the whole shambles of Top Management not even having a proper PLAN of what to do with the money!) or to cut pensions?

 

Likewise is it right to give one person huge bonuses based on the performance of emplyees who haven't seen a pay rise for 3 years and have seen THEIR pensions plans ruined by under-investment or tax "theft". Or even those who are forced out of work because of the "re-structurings/job description changes and find their old jobs being taken by low cost labour in Indian Call centres or Eastern European Labour? How big is the BA pension hole? So many people in the public sector will also get screwed AGAIN while the likes of the incompetent Freddy Goodwin and the other idiots who ruined the economy get bigger pay cheques?

 

Fact is the UK is as crook as anywhere else. Get yourself onto the gravy train in any sector and sod the rest of the country. The Greeks are an excellent example. The public are getting totally screwed and yet the Rich simply don't bother paying the taxes that get brought in and watch who gets to buy all the State Asset sell-offs.

[Lord Duckhunter]

I just received my Benefit statement 2011 from my pension scheme and it's depressing reading. Even though I have a final salary one (which most of the private sector dont), a lot of my pay is made up with bonus and allowences for shift work. Neither is deemed pensionable ( I dont know if that's law, or my schemes rules), it means my pension is hardly worth a ****. I dread to think what some of the lower paid with stakeholder or DC pensions are going to do.We'll get by because Mrs Duck has an NHS pension and her father is quite wealthy, but millions of others wont be so fortunate.

 

There is going to be a full blown pension crisis when my age group start to retire. My Father had a decent pension, and also an endowment that after paying off the mortgage gave him a £17,000 surplus. Mine wont even pay off my mortgage, the best case senerio is a £14,000 decifit.Of course that's not the Govt's problem and I understood the risks when I took it out, but just highlighting that previous generations benefitted from decent pensions, endowments that grew and grew and unbelievable house price rises.What is our generation going to rely on, Govt handouts?

 

Having read through this thread and many things on TV, I'm convinced that we need to address this issue, whether Private or public sector. The Govt needs to "bribe" people to save for their future. Whether it's tax breaks or some sort of "save a £1 and the Govt will match it" sort of scheme for the low paid, but in the long term the less money pensioners have, the more future generations will have to contribute, and we'll have this debate over and over again.

[dune]

Even though I have a final salary one (which most of the private sector dont), a lot of my pay is made up with bonus and allowences for shift work. Neither is deemed pensionable ( I dont know if that's law, or my schemes rules).

 

It's your schemes rules.

 

The Govt needs to "bribe" people to save for their future.

 

They already do. If you pay additional voluntary contributions you pay less income tax and national insurance and you can take the full amount as a tax free lump sum up to 25% of your lifetime allowance.

[Lord Duckhunter]

 

 

 

They already do. If you pay additional voluntary contributions you pay less income tax and national insurance and you can take the full amount as a tax free lump sum up to 25% of your lifetime allowance.

 

 

That's only applicable if people are already saving for a pension. How do we make people save in the first place?

 

My oldest has quite a decent job at Sunseekers, but he cant see the point in saving towards his retirement. He has bought his own place and is pretty switched on, but does not save a penny towards his retirement. In 50 years time, it's his kids who will be paying for that.

[dune]

That's only applicable if people are already saving for a pension. How do we make people save in the first place?

 

My oldest has quite a decent job at Sunseekers, but he cant see the point in saving towards his retirement. He has bought his own place and is pretty switched on, but does not save a penny towards his retirement. In 50 years time, it's his kids who will be paying for that.

 

I thought such people were automatically enrolled in the state second pension.

 

Company pension schemes almost always beat private pension schemes and the state second pension in terms of value so anyone that turns one down is an idiot. By the time you factor in the reduced tax/national insurance you don't pay much more.

[revolution saint]

I just received my Benefit statement 2011 from my pension scheme and it's depressing reading. Even though I have a final salary one (which most of the private sector dont), a lot of my pay is made up with bonus and allowences for shift work. Neither is deemed pensionable ( I dont know if that's law, or my schemes rules), it means my pension is hardly worth a ****. I dread to think what some of the lower paid with stakeholder or DC pensions are going to do.We'll get by because Mrs Duck has an NHS pension and her father is quite wealthy, but millions of others wont be so fortunate.

 

There is going to be a full blown pension crisis when my age group start to retire. My Father had a decent pension, and also an endowment that after paying off the mortgage gave him a £17,000 surplus. Mine wont even pay off my mortgage, the best case senerio is a £14,000 decifit.Of course that's not the Govt's problem and I understood the risks when I took it out, but just highlighting that previous generations benefitted from decent pensions, endowments that grew and grew and unbelievable house price rises.What is our generation going to rely on, Govt handouts?

 

Having read through this thread and many things on TV, I'm convinced that we need to address this issue, whether Private or public sector. The Govt needs to "bribe" people to save for their future. Whether it's tax breaks or some sort of "save a £1 and the Govt will match it" sort of scheme for the low paid, but in the long term the less money pensioners have, the more future generations will have to contribute, and we'll have this debate over and over again.

 

As a total aside and irrelevancy, don't try and point that out to the 60-65 group moaning about the withdrawal of their concession for S/Ts.

[Lord Duckhunter]

 

Company pension schemes almost always beat private pension schemes and the state second pension in terms of value so anyone that turns one down is an idiot. By the time you factor in the reduced tax/national insurance you don't pay much more.

 

You try and tell a 23 year old that he's an idiot for not planning for 2058, it's not an easy thing to get through to them.

[dune]

The point about getting a decent return on investments is a valid one. At the minute it's very turbulent out there. I've taken a chance and put my additional investment (additional to my final salary scheme) into equities with 35% UK and 65% worldwide (mainly in the US) in the hope that we're over the worst. Greece and sovereign debt elsewhere is the big concern. If I was coming up for reitirement i'd go for corporate bonds.

[saintfully]

I just received my Benefit statement 2011 from my pension scheme and it's depressing reading. Even though I have a final salary one (which most of the private sector dont), a lot of my pay is made up with bonus and allowences for shift work. Neither is deemed pensionable ( I dont know if that's law, or my schemes rules), it means my pension is hardly worth a ****. I dread to think what some of the lower paid with stakeholder or DC pensions are going to do.We'll get by because Mrs Duck has an NHS pension and her father is quite wealthy, but millions of others wont be so fortunate.

 

There is going to be a full blown pension crisis when my age group start to retire. My Father had a decent pension, and also an endowment that after paying off the mortgage gave him a £17,000 surplus. Mine wont even pay off my mortgage, the best case senerio is a £14,000 decifit.Of course that's not the Govt's problem and I understood the risks when I took it out, but just highlighting that previous generations benefitted from decent pensions, endowments that grew and grew and unbelievable house price rises.What is our generation going to rely on, Govt handouts?

 

Having read through this thread and many things on TV, I'm convinced that we need to address this issue, whether Private or public sector. The Govt needs to "bribe" people to save for their future. Whether it's tax breaks or some sort of "save a £1 and the Govt will match it" sort of scheme for the low paid, but in the long term the less money pensioners have, the more future generations will have to contribute, and we'll have this debate over and over again.

 

Erm, what are people supposed to save with? Most of the people I know don't have a pot to **** in, let alone spare money to chuck about.

 

And no, I don't smoke, don't own a house and only go out about once a month. My salary goes on rent, travel and food and thats about it. Oh, and before you ask I'm a research scientist with a public sector pension and I'm fu.ckin keeping it.

[Thorpe-le-Saint]

I'll ask Chapel again, did someone frog march you to and force you to sign up for your current job?

[Sergei Gotsmanov]

I just received my Benefit statement 2011 from my pension scheme and it's depressing reading. Even though I have a final salary one (which most of the private sector dont), a lot of my pay is made up with bonus and allowences for shift work. Neither is deemed pensionable ( I dont know if that's law, or my schemes rules), it means my pension is hardly worth a ****. I dread to think what some of the lower paid with stakeholder or DC pensions are going to do.We'll get by because Mrs Duck has an NHS pension and her father is quite wealthy, but millions of others wont be so fortunate.

 

There is going to be a full blown pension crisis when my age group start to retire. My Father had a decent pension, and also an endowment that after paying off the mortgage gave him a £17,000 surplus. Mine wont even pay off my mortgage, the best case senerio is a £14,000 decifit.Of course that's not the Govt's problem and I understood the risks when I took it out, but just highlighting that previous generations benefitted from decent pensions, endowments that grew and grew and unbelievable house price rises.What is our generation going to rely on, Govt handouts?

 

Having read through this thread and many things on TV, I'm convinced that we need to address this issue, whether Private or public sector. The Govt needs to "bribe" people to save for their future. Whether it's tax breaks or some sort of "save a £1 and the Govt will match it" sort of scheme for the low paid, but in the long term the less money pensioners have, the more future generations will have to contribute, and we'll have this debate over and over again.

 

I think the Aussies have it right. You pay 9% of your salary straight into a fund. You can claim it when you retire or you emigrate.

[Whitey Grandad]

It's your schemes rules.

 

 

 

They already do. If you pay additional voluntary contributions you pay less income tax and national insurance and you can take the full amount as a tax free lump sum up to 25% of your lifetime allowance.

But you'll pay the tax when you take your pension.

[dune]

But you'll pay the tax when you take your pension.

 

Yes, but you can take 25% of your lifetime allowance as a tax free lump sum.

[Whitey Grandad]

As a total aside and irrelevancy, don't try and point that out to the 60-65 group moaning about the withdrawal of their concession for S/Ts.

 

Ooh, you remembered! How nice of you.

[Whitey Grandad]

Yes, but you can take 25% of your lifetime allowance as a tax free lump sum.

 

Don't forget the charges when you pay in the cash, can be 2.5%.

[dune]

"There is no greater time in your life than retirement when financial advice is essential, as this money has got to last you for the rest of your life," advises Donna Bradshaw, of independent financial advisers IFG Financial Services. "By taking tax-free cash from a final-salary scheme you could be losing significant sums of money and be giving up far more than the cost of financial advice. As commutation rates vary from scheme to scheme, it is vital to get advice on the cost of taking a tax-free lump sum.

 

"Fortunately, the pension rule changes introduced in April 2006 offer a solution. Those who invest in top-up pensions known as Additional Voluntary Contributions (AVCs) can take their tax-free cash from these instead of the main scheme. As these are money-purchase schemes, no commutation factor is used - so taking 25 per cent of the fund means 25 per cent .

 

"This is a better option for retirees as the benefits lost reflect the true cost. However, not all schemes allow all the tax-free cash to be taken from the AVC rather than the main scheme, so retirees need to check the scheme rules first.

 

"If the scheme does allow this, those who have yet to reach retirement should consider topping up their AVC so they can take as much tax-free cash from that rather than the main scheme."

 

http://www.telegraph.co.uk/finance/personalfinance/pensions/2807281/A-lump-sum-can-cost-you-in-the-long-term.html

[Whitey Grandad]

So the government are lying then when they say that the LGPS is in credit and will be for at least the next 25 years?

 

Interesting point. The scheme is funded by the employees and employers and all that money comes from??? Apparently there is a deficit but the amount is open to debate.

 

http://boards.fool.co.uk/lgps-12207073.aspx

[badgerx16]

Interesting point. The scheme is funded by the employees and employers and all that money comes from??? Apparently there is a deficit but the amount is open to debate.

 

http://boards.fool.co.uk/lgps-12207073.aspx

"The LGPS is currently 'cash positive' – meaning payments into the scheme outweigh those going out"

http://www.localgov.co.uk/index.cfm?method=news.detail&id=100391

 

"The Funds have more than £140billion in investments and assets, enough to pay benefits for over 20 years." - The Local Government Association responding to the Hutton Report

 

"Sir Merrick Cockell, the new chair of the Local Government Association, also backed the decision. He said: ‘The LGPS is unique in the public sector due to its £140bn worth of assets and investments which make it much more like a private pension scheme. We are pleased the government has recognised that difference.

‘We will continue to argue strongly against a sizeable increase in worker contributions on the grounds that it could lead to employees opting out of the scheme. This would endanger the viability of a scheme which is helping 1.9 million people save toward their retirement and reducing reliance on state means-tested pensions.’" - http://www.publicfinance.co.uk/news/2011/06/local-government-gets-pension-reform-concession/

[Verbal]

"The LGPS is currently 'cash positive' – meaning payments into the scheme outweigh those going out"

http://www.localgov.co.uk/index.cfm?method=news.detail&id=100391

 

"The Funds have more than £140billion in investments and assets, enough to pay benefits for over 20 years." - The Local Government Association responding to the Hutton Report

 

"Sir Merrick Cockell, the new chair of the Local Government Association, also backed the decision. He said: ‘The LGPS is unique in the public sector due to its £140bn worth of assets and investments which make it much more like a private pension scheme. We are pleased the government has recognised that difference.

‘We will continue to argue strongly against a sizeable increase in worker contributions on the grounds that it could lead to employees opting out of the scheme. This would endanger the viability of a scheme which is helping 1.9 million people save toward their retirement and reducing reliance on state means-tested pensions.’" - http://www.publicfinance.co.uk/news/2011/06/local-government-gets-pension-reform-concession/

 

It's a similar story with USS, the university lecturers' pension scheme.

 

From The Guardian:

 

USS is the second biggest occupational pension scheme in the UK and according to its website is 'one of the largest and most stable pension schemes in the UK'. In the 12 months to March 2010, USS grew by £4.5bn despite a significant economic downturn in what was described as a 'good investment performance' by the fund's managers.

[Whitey Grandad]

At the moment it is in deficit but with a positive cash flow, which comes, of course, from public taxation. It is the only one of the main public sector pension schemes which is funded in any way. There are now more civil servants on pensions than there are working and the number of retired teachers rose from 445,000 in 2004 to 567,000 in 2010 whilst the number of teachers paying in has remained steady at about 600,000. The teachers' scheme is unfunded so present contributions are paying the pensions of those already retired so, in effect, if the teachers increase their current contributions it will be a pay cut whose savings will help to pay for those currently retired.

 

http://www.publicfinance.co.uk/news/2010/12/latest-lgps-deficit-forecast-challenged/

[Verbal]

If you're talking about USS you're wrong, grandad.

[Whitey Grandad]

If you're talking about USS you're wrong, grandad.

 

LGPS, actually. Your post arrived just before mine.

USS deficit £17bn in March 2010?

[badgerx16]

http://www.publicfinance.co.uk/news/2010/12/latest-lgps-deficit-forecast-challenged/

Some quotes from YOUR source :

 

"

But CIPFA condemned the report, saying it was based on figures from the Financial Reporting Standard 17 accounting standard, which took only a snapshot position of the pension liabilities.

Bob Summers, head of the CIPFA pensions panel, told Public Finance the forthcoming LGPS actuarial valuation would provide a better guide, taking into account a long-term view of the scheme’s affordability and sustainability and ignoring short-term fluctuations in market values. Due to be published early next year, the official valuation will also be used for revising employer contribution rates.

Summers said: ‘The information John Ralfe has presented is highly misleading. There is not a black hole in local authorities’ pension funds. We are going through a process of [actuarial] review at the moment.’"

 

"Mike Taylor, chief executive of the London Pension Funds Authority, said today’s numbers should not be taken at face value. He urged people not to panic. ‘This measure provides us with a snapshot view of LGPS liabilities that stretch out literally decades into the future, based on today’s interest rates,’ he said. Taylor added that the deficit would rise and fall on a daily basis according to interest rates, making the analysis ‘frankly not sensible’. "

 

"Brian Stratton, GMB national secretary for public services, said: ‘In effect, Ralfe is saying the equivalent of taking a snapshot of your personal finances part way through a mortgage – it looks like you’ve got an unaffordable debt but the reality is to look at the long term and whether you can meet that debt. That’s what actuaries do in the LGPS and the managers of the pension funds set the contributions accordingly.’"

 

"Gail Cartmail, assistant general secretary for public services at Unite, called it a ‘back-of-an envelope calculation’. "

[Whitey Grandad]

Some quotes from YOUR source :

 

"

But CIPFA condemned the report, saying it was based on figures from the Financial Reporting Standard 17 accounting standard, which took only a snapshot position of the pension liabilities.

Bob Summers, head of the CIPFA pensions panel, told Public Finance the forthcoming LGPS actuarial valuation would provide a better guide, taking into account a long-term view of the scheme’s affordability and sustainability and ignoring short-term fluctuations in market values. Due to be published early next year, the official valuation will also be used for revising employer contribution rates.

Summers said: ‘The information John Ralfe has presented is highly misleading. There is not a black hole in local authorities’ pension funds. We are going through a process of [actuarial] review at the moment.’"

 

"Mike Taylor, chief executive of the London Pension Funds Authority, said today’s numbers should not be taken at face value. He urged people not to panic. ‘This measure provides us with a snapshot view of LGPS liabilities that stretch out literally decades into the future, based on today’s interest rates,’ he said. Taylor added that the deficit would rise and fall on a daily basis according to interest rates, making the analysis ‘frankly not sensible’. "

 

"Brian Stratton, GMB national secretary for public services, said: ‘In effect, Ralfe is saying the equivalent of taking a snapshot of your personal finances part way through a mortgage – it looks like you’ve got an unaffordable debt but the reality is to look at the long term and whether you can meet that debt. That’s what actuaries do in the LGPS and the managers of the pension funds set the contributions accordingly.’"

 

"Gail Cartmail, assistant general secretary for public services at Unite, called it a ‘back-of-an envelope calculation’. "

 

Well I said it was 'open to debate'. That there is a deficit is not disputed.

[Verbal]

Well I said it was 'open to debate'. That there is a deficit is not disputed.

 

More like 'will be' a deficit, because many pensions funds are, in cash terms, in surplus. But of course it makes sense to calculate future liabilities as precisely as possible - otherwise you run the risk of running what is in effect a pyramid scheme, paying present pensions out of present contributions until, like Madoff, you simply run out of cash. These deficits are the result of actuarial calculations, rather than looking at the balance in the bank account, and the rules have been considerably amended in recent years to take into account, among other things, greater longevity. But they pay less attention, it seems, of evolving government policy on retirement age, so many think they're overly pessimistic.

 

But as you say, it's good that it's open to debate. Finally Saintweb can make its mark on national policy.