UKBouldering.com
the shizzle => shootin' the shit => Topic started by: tomtom on November 30, 2011, 09:41:18 am
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I've no beef - just interested...
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Well, I've had to take a day off (annual leave) to look after the kids because the school is on strike.
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I wouldn't class Universities as "public sector" yet there seems to be quite a few joining in on the strike. :shrug:
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Maybe they are just practicing for when they have one of their own.
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I can't really understand the point of this strike, maybe I'm being thick.
Everyone is in the same boat. My pension is fucked too, even though the NHS pension scheme is so good it actually makes money for the government. Since everyone is in the same boat, how does causing inconvenience help the cause of the strikers? The government can't really back down on this, otherwise it opens the door for masses of other people trying to push them.
:shrug:
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I wouldn't class Universities as "public sector" yet there seems to be quite a few joining in on the strike. :shrug:
Universities can, I suppose, be quite 'hybrid' organizations - but they are more public sector than they are anything else. Certainly the vast majority of their funding comes from the public purse.
They're striking because the union (UCU) won a mandate for action in a ballot (correct me if I'm wrong TT). Simple.
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The thing is its pretty ineffective, if I were to strike I'd have the same amount of work to do tomorrow with a day less to do it in and I'd be out of pocket. I can understand why its effective for teachers/medical care/front line public services/production line workers (effectively where it started) to strike but for office workers a "work to rule" approach would likely have greater efficacy as most of my colleagues put in more hours than they're contracted for.
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Distilling my question: What does this strike acheive other than losing any support the Strikers may have had before, and annoying people that actually want to work by cocking up their childcare with 24 hours notice?
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http://www.morningstaronline.co.uk/news/content/view/full/112516 (http://www.morningstaronline.co.uk/news/content/view/full/112516)
Pension are affordable, they were audited and shown to be. The government is just destroying them as a tax (on the elderly). Public sector pension average is below £6000.
While we're on politics, remember not to need rescuing from anywhere after 2016. You might not be profitable enough to bother with.
http://www.morningstaronline.co.uk/news/content/view/full/112530 (http://www.morningstaronline.co.uk/news/content/view/full/112530)
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cocking up their childcare with 24 hours notice?
How come you only had 24hrs notice? Did your childminder decide to go on strike yesterday?
I think the position 'well my pension is shit, so therefore everyone else's should be too' isn't a great starting point; why not 'those politicians get an awesome pension, why can't I too' instead?
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Schools only need to give 24 hours notice.
I think you're misinterpreting what I am saying. I'm not moaning about my pension as everyone, especially private sector workers, are going to be fucked.
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Universities can, I suppose, be quite 'hybrid' organizations - but they are more public sector than they are anything else. Certainly the vast majority of their funding comes from the public purse.
They're striking because the union (UCU) won a mandate for action in a ballot (correct me if I'm wrong TT). Simple.
Mine feels increasingly more like a business with "consultancy targets" for each sub-division, continually needing to secure independent funding for research projects, add to that the need to now "attract business" in terms of students who pay their own fees its increasingly moving away from any notion of 'public sector service'. And there's certainly not the perceived long-term job security/pensions that people are banging on about with regards to public sector ("job for life" etc. etc.) for a large proportion of research workers who are on short-term contracts, worst of both worlds really.
And what was the ballot to strike for? (As you may have guessed I'm not a member of any union, likely "pensions" I guess)
Distilling my question: What does this strike acheive other than losing any support the Strikers may have had before, and annoying people that actually want to work by cocking up their childcare with 24 hours notice?
My take would be "nothing more than that which you've highlighted".
My wife works at the local college, she's not going into work today, but because the workload expectation is greater than the time afforded for her to get it done in the office she's spending the day working at home, which completely defeats the object and is why I think a "work to rule" approach rather than outright striking would be more effective in conveying dissatisfaction with proposed changes.
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None of the options apply to me so I've gone pink anasazi.
I disagree with the government and the strike.
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I disagree with the government and the strike.
:agree:
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I disagree with the government and the strike.
:agree:
I kind of agree.
I'm no expert, but it seems pretty clear that people are and will continue to live longer, there is gonna be a huge lot of old folk running round in decades to come (us included ;))
There is a secondry here as well ; one of the reasons of the above is due to constantly improving and constantly getting more expensive health care, which is going to have an even more burden with increased old folk.
Anyway - there isn't going to be enough money for it/us all, so we all going to have to take a little hit one way or the other. Seems to me that while there may a better way for the rulers to go about it, throwing your dummy out 'cause the good times are over doesn't help either.
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When the government decides we can have a day off for the royal wedding it doesn't damage the economy. But when public workers decide to strike for a day it costs the UK economy half a billion.
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What I don't like when I'm driving to work is a bunch of people waving banners and jumping out in front of me in the road....kind of wish I'd put my foot down!
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When the government decides we can have a day off for the royal wedding it doesn't damage the economy. But when public workers decide to strike for a day it costs the UK economy half a billion.
I think the royal wedding was quoted as one of the reasons (excuses) for the poor GDP figures for Q2 last year.
From the pension perspective, as someone who's final salary scheme was closed completely 3 years ago with all future contributions going into a money purchase scheme I have limited sympathy for the strike. We are all living longer and it seems pretty obvious that we will all have to retire later.
BTW aren't any affordability arguments from 2008 a bit out of date given the state of the UK / World economy now compared to predictons in 2008.
Ian (working from home due to school closures)
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What I don't like when I'm driving to work is a bunch of people waving banners and jumping out in front of me in the road....kind of wish I'd put my foot down!
Passed people stood on a cycle path and as approaching had to use my bell to warn them, unfortunately they thought it was support for them. Think I'll resort to shouting next time as that will be unambiguous.
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a few points...
1. The main thing that disgusts me about the whole strike debate, is that people seem to think that because some workers may have a better pension than they get, they should suffer for it. Why can't people be glad that teachers get decent pensions? Whats wrong with that?
2. The 'public' is not subsidising a teachers pension - the (negotiated) settlement 2-3 years back meant a later retirement date and increased contributions - this made it sustainable... By raising employee contributions and the retirement age further the government will make £2.9 billion a year. This is going straight into budget defecit reduction stuff. Private sector workers - if you feel strongly about this - why not contribute an extra 3% of your wages to the defecit reduction scheme?? (teachers pension contributions will rise from 6-9% under the govts scheme).
3. A pension is no more a privelige than a wage packet. It is part of the deal - the package - that you sign up for when you take a job. This is akin to being given a fairly signficant pay cut.
Tits. Pressed send before finishing.. bear with me..
4. Andy, UCU is on strike today for god knows what reason - our scheme has been settled (AFAIK) - I think its bollocks that lecturers are supposed to be striking today...
5. I completely agree that a pension fund has to be self sustaining. Thats fine - my T&C's have changed recently - career average, increased contributions etc.. I can see that and I agree with it. I dont necessarily like having to pay more, but I dont feel I should get something for nothing.. but what is happening with the public service pensions where there is no pot (i.e. its the Govt) is just a tax on them. And thats wrong. this may have started with the last Govt - I dont know - I dont care - I dont think it matters..
6. If you dont want to have to pay for public sector workers salaries and/or pensions then fine. But you'll have to pay for your healthcare, schooling, nursery, defence, ambulance, fire service etc.. yourself....
Grrr. Rant over.
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Eh, teachers are striking because they've got a good deal, that doesn't make sense? :shrug:
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Eh, teachers are striking because they've got a good deal, that doesn't make sense? :shrug:
Are you sure?
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What I don't like when I'm driving to work is a bunch of people waving banners and jumping out in front of me in the road....kind of wish I'd put my foot down!
The roads were pretty empty for me this morning. Was nice.
Being ill informed I don't really see how strikes will help. We are all pretty fucked at the moment. There is even talk of being in recession at the moment
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a few points...
1. The main thing that disgusts me about the whole strike debate, is that people seem to think that because some workers may have a better pension than they get, they should suffer for it. Why can't people be glad that teachers get decent pensions? Whats wrong with that?
2. The 'public' is not subsidising a teachers pension - the (negotiated) settlement 2-3 years back meant a later retirement date and increased contributions - this made it sustainable... By raising employee contributions and the retirement age further the government will make £2.9 billion a year. This is going straight into budget defecit reduction stuff. Private sector workers - if you feel strongly about this - why not contribute an extra 3% of your wages to the defecit reduction scheme?? (teachers pension contributions will rise from 6-9% under the govts scheme).
3. A pension is no more a privelige than a wage packet. It is part of the deal - the package - that you sign up for when you take a job.
1. People in the private sector have seen there final salary pension schemes closed to reduce cost and risk exposure for their companies - why are you suprised that they don't all fall over themselves to support public sector workers striking over renention of benefits they don't have the option to keep.
2. How do your measure sustainability? How much is the employer contribution to the teachers pension scheme? My employee contributes 10% into my money purchase scheme, and thats relatively attractive by private sectors standards. I would increase my pension contributions by 3% in a shot if I could have a scheme like the teachers,
3. All sorts of areas of employment package change over time. Assuming they are not trying to change previously earned benefits I don't understand this as a significant argument.
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Eh, teachers are striking because they've got a good deal, that doesn't make sense? :shrug:
Are you sure?
Well thats what tomtom's first point seems to suggest...
1. The main thing that disgusts me about the whole strike debate, is that people seem to think that because some workers may have a better pension than they get, they should suffer for it. Why can't people be glad that teachers get decent pensions? Whats wrong with that?
...and teachers are striking aren't they?
I thought they were striking because they've got to pay a bit more and work a bit longer, but then......so does everyone else. Its a simple self-evident fact that people are living longer than they used and money doesn't grow on trees.
I suspect I may be confused by the points tomtom is getting at. :blink:
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When the government decides we can have a day off for the royal wedding it doesn't damage the economy. But when public workers decide to strike for a day it costs the UK economy half a billion.
I think the royal wedding was quoted as one of the reasons (excuses) for the poor GDP figures for Q2 last year.
Hmmm, I wonder what Georgie boy will be blaming the next lot of shit figures on :-\
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To be honest, I think hit's pretty harsh cutting back public sector pensions for the majority of public sector workers. They are generous compared to the private sector, but I think the place they should be hitting is the massively overpaid public sector "executives" who get paid ludicrous sums of money and often get a nice wee promotion 2 years before retiral to boost their final salary pensions...
There's so much waste (PFI schemes, bureaucracy etc. etc.) that should be tackled first.
One point my uncle, a uni professor, has made (which is linked, albeit slightly indirectly) is that with the increase in tuition fees AND the reduction in pensions, it's going to make it pretty financially crippling to study for 3/4 years, then do a PHD all before earning a penny. The at the end your pension gets hammered too...
Am I wrong in thinking whole pension idea is fvcked anyway, is it relies on indefinite GDP growth? (Which, itself is unsustainable and undesirable...)
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Hmmm, I wonder what Georgie boy will be blaming the next lot of shit figures on :-\
He should be blaming it on the fact that even in the good years real growth was less than 2% once you strip out the growth that was fuelled by public and private sector overborrowing. Add in a global recession and we were fucked well before you consider whether the austerity measures have had a negative effect on the economy. Plan A isn't working mainly because there's a good chance that no plan will work. Ed Balls kicks up a good stink but goes strangely silent when the economic realities of any alternative strategy are put to him. The austerity measures are predicated on the fact that if we don't have them our gilt prices will fall through the floor and we'll spiral into bankruptcy (gilt prices being inversely proportional to yield). There's a good argument that the only reason that this isn't happening anyway is because our gilts are currently seen as safer than Europe's. If the Euro goes under, and there's a good chance it will, then the negative effect on out growth is likely to be so severe that there will be no possible way out, and then on top of that the bond yields will shoot up as the chance of default increases. If you really want to depress yourself read this:
http://www.tullettprebon.com/Documents/strategyinsights/Tim_Morgan_Report_007.pdf (http://www.tullettprebon.com/Documents/strategyinsights/Tim_Morgan_Report_007.pdf)
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To be honest, I think hit's pretty harsh cutting back public sector pensions for the majority of public sector workers. They are generous compared to the private sector, but I think the place they should be hitting is the massively overpaid public sector "executives" who get paid ludicrous sums of money and often get a nice wee promotion 2 years before retiral to boost their final salary pensions...
Emotionally attractive (and excessive top salaries certainly have an impact on people's view of fairness) but in actuality the number of people earning really high salaries is probably smaller than you think.
From http://news.bbc.co.uk/1/hi/8151355.stm (http://news.bbc.co.uk/1/hi/8151355.stm),
Approx £45k would put you in the top 10% of earners, £59k the top 5% and only 1% earn more than £120k.
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At the Royal Devon and Exeter hospital, the junior admin staff are being given an effective 20% pay cut and 30% redundency. The clinical consultants, campaigned for a 3% cut in their OWN salaries; which would have saved the trust more. However, the trust management would have had to take a pay cut if the consultants did...
So, the junior admin staff take it where the sun don't shine; the consultants now share one secretary between 3 and the management have a 4% pay rise (in order to attract and maintain the highest caliber of management (their words)).
I'm only surprised these are strikes, not riots. The media has glossed over the public sector cuts and it is always the bottom of the rung who take the shite...
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To be honest, I think hit's pretty harsh cutting back public sector pensions for the majority of public sector workers. They are generous compared to the private sector, but I think the place they should be hitting is the massively overpaid public sector "executives" who get paid ludicrous sums of money and often get a nice wee promotion 2 years before retiral to boost their final salary pensions...
Emotionally attractive (and excessive top salaries certainly have an impact on people's view of fairness) but in actuality the number of people earning really high salaries is probably smaller than you think.
From http://news.bbc.co.uk/1/hi/8151355.stm (http://news.bbc.co.uk/1/hi/8151355.stm),
Approx £45k would put you in the top 10% of earners, £59k the top 5% and only 1% earn more than £120k.
Just started reading the Hutton report (http://www.hm-treasury.gov.uk/d/hutton_fairpay_review.pdf) into public sector pay, and, well, all I can say is that if the government followed his advice things would improve significantly!
I still think that final salary pensions that allow you to jump grade 2 years before retiring are an absolute farce. I'd happily leave the contributions as they are as long as lifetime salary-linked pensions were brought in.
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Just started reading the Hutton report (http://www.hm-treasury.gov.uk/d/hutton_fairpay_review.pdf) into public sector pay, and, well, all I can say is that if the government followed his advice things would improve significantly!
:lol: :lol: :lol: :lol: When have any government in the last 20 or so years ever listened to the results of reports they commission (vis. Prof Nutt debacle)? As long as they are seen to have commissioned a report its sufficient to placate the populace and they can (and will) do whatever the fuck they want.
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well the fuckers just cost my company £300 in staff wages and diesel cos we cant get our deliveries done. 2nd attempt at delivering in manc town may flush more money we havent got down the drain.
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When the government decides we can have a day off for the royal wedding it doesn't damage the economy. But when public workers decide to strike for a day it costs the UK economy half a billion.
I think the royal wedding was quoted as one of the reasons (excuses) for the poor GDP figures for Q2 last year.
Hmmm, I wonder what Georgie boy will be blaming the next lot of shit figures on :-\
It's ok, he has an excuse for another year, as there is the Jubilee coming up next year ;)
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Adjusting for inflation, teachers have now paid in £46,000,000,000 (£46 billion) more than had been paid out.
The government has given that money to the private sector to run services ineffectively, has used it to prop up the banks, and now wants more money from us to raise it's profits off our pensions and continue to support the destructive banking system, multinational corps and privatisation of public services.
They've thrown away £46,000,000,000 of our pensions into the private sector and now they want more.
And they have the Fucking cheek to say the private sector is propping us up.
Cunts.
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I am on strike today because when I started as a student nurse 25 years ago I signed a contract offering me a final salary pension scheme. Which stated if I paid x amount of my salary I would get x amount when I retired.
Now someone is trying to change those terms without my agreement.
If I signed a contract to buy something which said I would pay a £100 for 3 years then they suddenly decided I had to pay £200 for 5 years. I could take them to court.
The nhs pension scheme is cash rich so the increase in contributions is just being used to bail out other areas of economy.
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Interesting, what figures have you based these calculations on?
How long a period are you accounting for? 1980-present will be very different from 1970-present.
Do teachers/public sector workers/etc. have to take the pension offered by their employer or have they always had the opportunity/choice to not pay into it and instead invest the money into a personal pension (obviously anyone can do so in addition to any pension offered by their employer).
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Who are you replying to.
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I was questioning psychomansam and the £46billion figure.
And for yourself, if its breach of contract has anyone actually tried taking their employers to court for breaking the contract yet?
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ok.
But to answer your other question you could opt out of the nhs scheme.Lots of staff were advised to in the first heady days of financial advisors.However this was found to be wrong advise and they were allowed to rejoin the scheme and paid conpensation( I'm not sure by who )
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I am on strike today because when I started as a student nurse 25 years ago I signed a contract offering me a final salary pension scheme. Which stated if I paid x amount of my salary I would get x amount when I retired.
Now someone is trying to change those terms without my agreement.
If I signed a contract to buy something which said I would pay a £100 for 3 years then they suddenly decided I had to pay £200 for 5 years. I could take them to court.
The nhs pension scheme is cash rich so the increase in contributions is just being used to bail out other areas of economy.
Just got a text from orange today:
Hi from Orange. We're increasing the price of your monthly plan by 4.38% from 8 January 2012. For more information please visit....
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The choices everyone at our work were provided with at work were a) agree to revised pension scheme b) submit resignation letter. Quite a few people with 30+ years service chose b) in order to keep their FSP. I never had the option so it didn't bother me.
There were some unhappy faces for a while, but everyone realised the reality of it being unsustainable in the current economic climate so they lived with it.
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ok.
But to answer your other question you could opt out of the nhs scheme.Lots of staff were advised to in the first heady days of financial advisors.However this was found to be wrong advise and they were allowed to rejoin the scheme and paid conpensation( I'm not sure by who )
Presumably those who gave the poor advice paid the compensation?
As mentioned above aren't all pensions based on speculation and the assumption that growth increases all the time? I'm sure I read some caveat in the stuff about my pension that I could choose for it to be invested in high or low risk investments, but regardless there was the possibility that the end value may be less than the amount I paid in
Time for a new phone contract Fultonious? Or are you just going to go on strike and not use your phone? :clown:
There were some unhappy faces for a while, but everyone realised the reality of it being unsustainable in the current economic climate so they lived with it.
The 'current climate' certainly hasn't helped matters, but the fact is that it was unsustainable anyway given that life expectancies in the UK have increased by 10 years over the last 40 (http://www.google.co.uk/publicdata/explore?ds=d5bncppjof8f9_&met_y=sp_dyn_le00_in&idim=country:GBR&dl=en&hl=en&q=life+expectancy+uk). Pensions designed to be taken at 65 and paid out for 5-10 years just aren't going to cover an extra 5-10 years that people are now living, especially given inflation continually pushes the cost of living upwards.
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I never understand the public vs private debate. Some people are show an almost religious zeal in their hatred/jealousy of public or private sector counter parts. As a private sector worker I wish I had a good pension to moan about and a chance of a pay rise. All in my company have been on wage freezes for 2 years alongside a recruitment freeze. This doesn't make me think that all teachers/nurses/ambulance drivers are lazy cunts who don't know which side their bread is buttered. It makes me think that I wish I had some power to change the current situation. It does make me dislike the politicians even more though - didn't they recently increase their pension schemes? as always it's the hypocrisy that sticks in my throat and the fact that it makes no difference who any of us vote for. I think we're all fucked for the next 5 years. After that who knows? We may have to accept that as the west becomes less well off compared to newer more vibrant and younger economies our relative living standards will start to slide.
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The choices everyone at our work were provided with at work were a) agree to revised pension scheme b) submit resignation letter. Quite a few people with 30+ years service chose b) in order to keep their FSP. I never had the option so it didn't bother me.
There were some unhappy faces for a while, but everyone realised the reality of it being unsustainable in the current economic climate so they lived with it.
The difference with the public pension pot is it gets raided by all and sundry to pay for private companies to deliver shite public services. If the public pension pot was protected, there is would be sustainable (or there abouts). In addition to this, wrt teachers they went through all this in 2008, increased their contributions and length of service, reduced the value of their pension at the end of it, we told that it was now all fine and 3 years later they'rer being told they have to do it all again!
I don't believe striking is right in this case but I have a lot of sympathy for their cause. People whinging that they have a shit deal in the private sector so so should everyone else gets on my tits.
(I am a private sector worker on a shite defined contribution scheme as a point of reference/bias)
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I am on strike today because when I started as a student nurse 25 years ago I signed a contract offering me a final salary pension scheme. Which stated if I paid x amount of my salary I would get x amount when I retired.
Now someone is trying to change those terms without my agreement.
If I signed a contract to buy something which said I would pay a £100 for 3 years then they suddenly decided I had to pay £200 for 5 years. I could take them to court.
The nhs pension scheme is cash rich so the increase in contributions is just being used to bail out other areas of economy.
Nail. Head. Hit.
I've been busy non-striking today, so not had the chance to respond, but frankly I'm surprised at the response of some of the people here - who seem to have been taken in by the Government spin on this. Look at the numbers.... (Slackers I expected better of a man of logic! ;) )
Public sector pensions ARE sustainable, with the increased payments and increased retirement age agreed in a deal a couple of years ago. They have (had) been 'future proofed' by being related to CPI instead of RPI (may have got that the wrong way round but hey ho!), increasing payments and delaying the retirement age (in the case of teachers from 60 to 65). This was all agreed/done/dusted moaned about but accepted.... Then THIS government have come along and UNILATERALLY decided to up the employee contributions AND increase the retirement age again. FFS, this is equivalent to everyone in the public sector getting a 3%+ tax rise... its SCANDLOUS....
My pension (Academics) has had the retirement age raised to 66, employee contributions raised by 1.5%, related to CPI not RPI and is now career average instead of final salary. Its not as good as what I started with, but OK, fair enough - I'm not dumb enough or greedy enough to think I'm going to get something for nothing. This has been (largely) agreed.. My pension is managed by an indepenent trust set up especially for that purpose..... here's the rub - its NOT the Govt pocket which is the case for teachers et al...
I simply cannot believe that people out there think that the re-negotiated pensions are 'unsustainable'.... FFS!
edit - sorry - not meaning to tar everyone with the same brush.. just having a rant :) had to keept the radio off most of today, it was making me grr....
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But do the government ever ring-post their income from one area for that specific area?
E.g. Does all income from road tax and fuel duty get plied back into Highway maintenance? Does all of the tax from fags go back into the NHS to cover the increased burden of cancer and heart disease that occurs?
Isn't balancing fiddling the books so that they even out whats done by consecutive governments on all fronts?
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But do the government ever ring-post their income from one area for that specific area?
E.g. Does all income from road tax and fuel duty get plied back into Highway maintenance? Does all of the tax from fags go back into the NHS to cover the increased burden of cancer and heart disease that occurs?
Isn't balancing fiddling the books so that they even out whats done by consecutive governments on all fronts?
(http://t3.gstatic.com/images?q=tbn:ANd9GcQMO4XuyJL8KpdPJ3J0yoA7qcmikL2QKukAp7N3RKZ8hAjXE-dxDQ)
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But do the government ever ring-post their income from one area for that specific area?
If not, then are you happy for the public sector wages to be taxed more than the private sector at source?
I don't see why the public sector should pay more tax than me?
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OK, I put my hands up! I've got to be perfectly honest and say - I'm not that up to speed on the current situation (i.e. I thought this was just another bun fight over the previous change to pension contributions etc.).
If, Tomtom, like you say - the 1.5% increase and age 66 retirement age etc. etc. are sustainable (link anyone?). Then...I'm with you - the government should go and fuck themselves!
All this chat about the public sector "pension purse" being robbed of £46billion sounds a bit far fetched, but if you have a link, hit me with it!
I'm going to go home and cry into my 5% contributory pension scheme that will probably evaporate if the global economy doesn't fix itself soon... :wavecry:
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:lol:
http://www.dailymail.co.uk/news/article-2067997/Heathrow-braced-chaos-hundreds-Border-Agency-workers-walk-out.html (http://www.dailymail.co.uk/news/article-2067997/Heathrow-braced-chaos-hundreds-Border-Agency-workers-walk-out.html)
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But do the government ever ring-post their income from one area for that specific area?
If not, then are you happy for the public sector wages to be taxed more than the private sector at source?
I don't see why the public sector should pay more tax than me?
Yup - loads of governments have spent from the pension pot like ol'Bob above did - but this Government is now asking the workers to pay more into the pot that the govt is 'borrowing' from... outrageous...
Imagine putting a quid into a piggy bank every day, so at Xmas you have £££ to spend. But someone keeps emptying the bank, and then has the temerity to say 'hang on, your piggy bank's a bit empty - you're better put some more in!'...
Bet you'd be chuffed to do that!
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But do the government ever ring-post their income from one area for that specific area?
If not, then are you happy for the public sector wages to be taxed more than the private sector at source?
I don't see why the public sector should pay more tax than me?
No and neither do I respectively, but people who've still got a number of years to retirement can easily pull out of their public sector pensions and instead put their remaining money into private personal pensions (or possibly transfer the existing amount if possible too?).
Wouldn't that seriously screw over these plans to pilfer the supposed pension pot?
I really don't know a great deal about this and don't have much faith in some of the numbers being bandied around in the media, hence some pretty dumb questions as I try and understand what all the fuss is about (actually getting work done today so don't have a great deal of time to do tons of research).
Is that fat old bloke the one who threw himself off his fancy yacht? Maxwell?
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None of the options apply to me so I've gone pink anasazi.
I disagree with the government and the strike.
Shit Jaz, you sound like a labour politician! Get off the fence!
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No and neither do I respectively, but people who've still got a number of years to retirement can easily pull out of their public sector pensions and instead put their remaining money into private personal pensions (or possibly transfer the existing amount if possible too?).
Wouldn't that seriously screw over these plans to pilfer the supposed pension pot?
It would also mean that the public sector employee would get an even worse pension. Cut your nose off.....
If they start a private pension, the sole contribution is their's, there's no employer contribution so they are shafted there. I get a matched contribution form my employer (to a max percentage - as do most private sector employees to a similar degree) so the public sector employee opting out of the scheme would have gone from a decent pension to one worse than the standard private sector employee.
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I asked a question about sustainbability above (re employer contributions) but didn't get an answer so looked it up myself and found that both the Teachers and NHS employer contribution arre 14% so that's a minimum 4% extra on most private sector schemes, significantly more in many cases - for example my company has sliding contribution starting at 4% in your 20's and rising to 10% in your 50's, I'm 'lucky' enough to be on a flat 10% which was agreed when we were moved out of the final salary scheme.
So even if you ignore the underwriting of the potenially significant risk involved with final salary schemes the government is contributing significant amounts to these pension schemes - given the present state of the UK balance sheet it must be at least a valid question to ask whether this sustatinable.
I don't won't make a definite judgement on the rights and wrongs of either side but it doesn't really seem that the 'I'm striking because I'm entitled to this' is the right way forwards.
BTW I'd think it unlikely that the details of you pension entitlement form part of your contract.
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OK, I did some digging rather than quoting what my colleagues wife told me..
2007 teachers pension agreement (google it if you like)
Retirement age up frmo 60 to 65
Linked to CPI instead of RPI (this makes a surprising difference)
Employee contribtion up from 6 to 6.4% (I was wrong here, sorry)
Employer contribution up from 13.5 to 14.1%..
Theres some extra shizzle about reduced final payments and increased costs of buying years etc..
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No and neither do I respectively, but people who've still got a number of years to retirement can easily pull out of their public sector pensions and instead put their remaining money into private personal pensions (or possibly transfer the existing amount if possible too?).
Wouldn't that seriously screw over these plans to pilfer the supposed pension pot?
It would also mean that the public sector employee would get an even worse pension. Cut your nose off.....
If they start a private pension, the sole contribution is their's, there's no employer contribution so they are shafted there. I get a matched contribution form my employer (to a max percentage - as do most private sector employees to a similar degree) so the public sector employee opting out of the scheme would have gone from a decent pension to one worse than the standard private sector employee.
Hmm, my wife is quite pleased she now teaches hairdressing (at a local college) and that she has any pension at all, prior to making the switch to teaching she paid into a private pension all on her own, which was hard work on a hairdressers salary. Hairdressers and a lot of other private sector workers (and I'd hazard a guess that its not a negligible proportion of the populace, mechanics, till-jockeys, anyone who's self-employed (~12% or working population a few years ago (http://www.guardian.co.uk/money/2006/oct/10/workandcareers.business) etc.) don't get any employer contributions either, so whilst a fair proportion of those in the private sector do have employer matched contributions I'm not sure its most.
Given the lesser of two evils you have to choose one (or go on strike it would seem).
Perhaps society needs to change....
Logan's Run (trailer) (http://www.youtube.com/watch?v=4WUUnc1M0TA#)
:clown:
(More seriously the continued obsession with longevity, and curing cancer/dementia/heart disease/etc. really isn't doing western societies any favours, the time money and effort would be far better invested in reducing the inequalities that already exist around the world in living standards and providing everyone with clean water, sanitation and enough food each day. Idealisitic, yes, but thats just like my opinion, man).
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I joined the Public sector workers march in the centre of Sheffield today. Although I'm no longer employed in the public sector, I felt it was right to support them for any number of reasons but the single biggest factor was a determination not to sit on my hands while this shit storm of a govt screws one group of workers after another. FFS, I wish we were all in this together, ie, prepared to fight for each other's rights rather than joining in the mud slinging as soon as someone says, no, i'm not taking any more. The kind of supine acceptance of the govt's case exhibited by some of the posts on this thread makes me want to puke. The coalition is hitting the poorest hardest and I feel the strikes are in many ways a response to that. There is ample evidence that the burden of pension provision is going to reduce over the next few years rather than rise, see the Hutton report, "Details of the Hutton review of public sector pensions. ... Using this measure, the cost of public sector pensions is projected to fall from a peak of 1.9 per cent ... So costs are already coming down and are manageable." Much of what is going on is ideologically driven not economically hence the welter of skewed statistics form the govt and the right wing press. If all we do is sit on the sidelines sniping at each other, then we're doing the govt's job for them. What we should be doing in my humble if slightly mardy opinion is stick together and fight for better workers rights regardless of whether its public or private sector. OK, rant over for now you bunch of fucking toadies......
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I can't believe you said I sounded like a Labour politician! :P
Anyway. There's a lot of shite being talked by both sides which is why I said I disagree with both the government and the strike. How about some fact checking.........
http://blogs.channel4.com/factcheck/factcheck-the-truth-about-the-public-sector-pensions-row/8608 (http://blogs.channel4.com/factcheck/factcheck-the-truth-about-the-public-sector-pensions-row/8608)
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Channel 4 Factcheck analysis from June 2011 (http://blogs.channel4.com/factcheck/why-camerons-right-on-public-sector-pensions/7090)
It too cites the Hutton report as forming the basis of the proposed changes, have things changed substantially since then to invalidate this apparently objective analysis?
To answer my own question before I post Worse of than current situation, but the envy of most private sector workers (http://blogs.channel4.com/factcheck/factcheck-the-truth-about-the-public-sector-pensions-row/8608). <-- EDIT : Same link as Jasper's posted
One 'catch' that seems a valid objection appears to be using Full Time Equivalence (FTE) in calculating whether someone is below the £15k threshold (http://fullfact.org/factchecks/public_sector_pensions_strike_unions-3160)
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I'm lucky enough to receive a public sector pension via the NHS - however I may consider leaving it if contributions go up.
I have to pay roughly 20% of my salary into it. As I'm a self-employed GP I have to pay both employers and employees contribution.
I've got 30 years service - if I retire at 65. So some serious financial advice may be needed.
The only reason to stay is the survivors benefits and the tax implications.
As stated above the NHS pension is self-funding.
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So in summary, are we saying
- its true that the public sector pension scheme is sustainable, in the sense that there's enough money in the scheme as it stands.
- the Hutton report predicts that the pensions burden on the state will actually decline in the future
- public sector workers took a significant cut in their pensions already, under labour
- they're now being asked to pay more into their schemes, work longer AND receive less when they retire
- this in the context of a wage freeze when living costs are rising rapidly.
And, based on these facts people argue that they shouldn't strike? I find that pretty gobsmacking. OK, public sector pensions are the envy of many in the private sector, but surely the answer to this is to improve the private sector pensions?
This does just look like a raid on public sector workers, because it's more politically advantageous than tax rises for all. I'm surprised so many people seem to agree with the government line
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Good summary Stu - but I don't see striking inconveniencing the government but it does inconvenience and cost lots of other (equally) struggling workers money. Strikes also seem to turn people against public sector workers and allow the government and the facts to hide behind an idealistic smokescreen. So I'm against the strikes (and the government)
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...and teachers are striking aren't they?
I thought they were striking because they've got to pay a bit more and work a bit longer, but then......so does everyone else. Its a simple self-evident fact {etc}
I suspect I may be confused by the points tomtom is getting at. :blink:
Slack-line, I agree with your last point. I mostly agree with what Tomtom has posted, which has never happened to me before, tbh. Try this:
Teachers are striking because they don't like be taxed by the government for deficit reduction purposes and having it passed off as necessary changes to pensions. Changes to teachers pensions aren't necessary. On current data (derived from government figures) we could all stop contributing completely and pensions could be honoured as is for 35 years from the existing fund (accrued since 1923). Hutton ushered in an agreement in 2007 that allowed the government to declare the scheme fair and sustainable. Cameron et al are just cutting wages by 3% and selling it as something it's not.
There are other changes such as RPI > CPI and longer working life. I work hard - in a way that I do not believe I will be capable of in my mid/late 60s when the new retirement age will be. We don't have front-line police officers working at these ages because they are not equipped to do the job as they should. What about teachers? My contract is based on a nominal 37.5hr week but in reality is around 50, and I may work late (till 2am one night last week, then up at 6, it was just busy) and at weekends and during holidays, including contact time in school.
Any teacher who retires early will have a correspondingly reduced pension. Some will remain capable, some will be just about get through to the end despite their years- I don't want my child taught by these teachers, or to be one- and some will get the push early.
The academy system represents the privatisation of public education, but funded by public money. Academies are, as you may know, schools run as businesses, but funded by a slice of public money and any other sponsorship money. Of course this means the reduction of parent governors and the sponsors getting seats on governors' committee. McEducation, anyone, with Ronald McDonaldGove?
Eventually all schools will be run this way. Terms and conditions are set by the school, and not in the teachers favour. I can't see many ageing teachers being retained for example. Pay, conditions of service and workload are key factors in recruiting and retaining good staff. Schools need good teachers who are enabled to work effectively. The current raft of proposals will do the opposite.
We often hear that the indecent sums paid to top execs are 'market rate' and necessary to secure good staff. Trust me, decent pay and conditions are necessary to secure good staff in other walks of life too. Do you want second-rate nurses and teachers?
Currently I've got a sustainable pension and am remunerated fairly for my work. I don't need more, I don't expect less. If there were a hypothecated tax to establish a proper pension for all, I'd be prepared to pay a lot more than 3%. But that's not going to come from this Tory government. (Apparently there's some from the Liberal tradition in there too, what a joke).
BTW after 6 years my current pension is in 3, not 4 figures, so treat Cameron's numbers with some suspicion. Why is the burden of deficit reduction falling on the least equipped to pay for it - across the board? And why are we giving money away to those who already have it, David Hartnett (http://www.thisismoney.co.uk/money/news/article-1704527/Taxman-let-Vodafone-off-6bn-bill.html) ?
I'm on strike because the education system and my income are unreasonably threatened by a bunch of crooks Slack-line, and they'll lie to you as often as they'll lie to me. Constantly.
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Rich - Fair enough. I guess it depends on what you think about collective action in general.
One thing to think about; in the US middle incomes have not risen at all in the last 20 years. This is a period where GDP has increased 50% and pay for the rich has increased over 30%. Things are better in the UK, but a similar pattern is true.
A lot of this is because collective bargaining is out of favour - labour is "weak" at the moment. So companies increase efficiency and profits, but little of this wealth is ever seen by the poor and middle class.
It has been argued that this is the root cause of the west's decline and the financial crisis. With rising living costs and stagnant wages, a worker's only option is to borrow more or reduce his standard of living. If everyone borrows too much, well, we've seen what happens then. And we're seeing what happens now when everyone reduces their standard of living; growth disappears as consumers stop spending.
For this reason I generally support strikes if the cause is just - I don't see that the economy is served by a labour movement that is too weak.
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I'm sorry, but of course striking inconveniences the government, if it didn't they wouldn't spend as much time and money arguing against it.
I've worked in both the private and the public sector and in my experience people are extremely reluctant to strike, and only when they feel they have no choice is this option taken.
This has been the largest strike since 1979 and as such can be taken as the proverbial 'canary in the mine' for peoples' general opinion as to the state of the nation.
The opinion that I've heard a lot today that a one-day strike won't change anything since noone will notice, or that evidently we don't need unions anymore has obviously been made ridiculous by the simple fact that people are prepared to go out onto the steets to voice their opinions.
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As I'm sure you're all aware this strike is not just teachers with potentially quite healthy pensions at retirement, it includes all kinds of professions and people that work for local government etc. Some of the worst hit by proposed pension changes will be those on the lowest wages that work hard doing shitty jobs in the public sector.
This all comes the day after billionaire George anounced further 'austerity measures' extending for longer, resulting in more job losses (than predicted) in the public sector. The situation within the public sector is extremely tense, rumour mills are grinding away, morale is withering and the knives are being sharpened for 2012/2013 cuts.
I used my legal right and I withdrew my labour today because of this poorly justified attack on our T&Cs.
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I know of one TA who is looking to change to a nearer school: when their car-share partner leaves the petrol cost will become unaffordable. Why should they take a 3% pay cut when the largesse of tax write-offs to the very rich is measured in billions?
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So in summary, are we saying
- its true that the public sector pension scheme is sustainable, in the sense that there's enough money in the scheme as it stands.
And, based on these facts people argue that they shouldn't strike? I find that pretty gobsmacking. OK, public sector pensions are the envy of many in the private sector, but surely the answer to this is to improve the private sector pensions?
Nobody has answered my question re whether public sectors workers getting employer contributions in the order of 4 - 8% of salary greater than private sector workers is 'sustainable'. Obviously leaving things as they are means they will continue to get this additional contribution going forwards and it appears unarguable that there are pressures on public sector funding in all areas with the current state of public finances.
On the second pont of improving private sector pensions I can't imagine that increasing company contributions by 4%+ (how many billions a year is that?!) is a likely option.
We live longer - how can we expect to retire at the same age as our parents without either contributing significantly more or having less money?
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What is happening, public and private; is not right.
What option do people have, except striking? How can anyone influence their own future, if they have no way to make their point. It's not as if we can have an election tomorrow (and would any other party have any more empathy?).
Public sector covers a huge sphere and I think we would all be sorry to see a fully privatised society (take a look at your utility bills or try living somewhere without state medicine).
No, on balance; I support the strike.
And JR.. Sorry for that rant, it just annoys me...
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Nobody has answered my question re whether public sectors workers getting employer contributions in the order of 4 - 8% of salary greater than private sector workers is 'sustainable'. Obviously leaving things as they are means they will continue to get this additional contribution going forwards and it appears unarguable that there are pressures on public sector funding in all areas with the current state of public finances.
On the second pont of improving private sector pensions I can't imagine that increasing company contributions by 4%+ (how many billions a year is that?!) is a likely option.
The need to review all pensions is obvious enough. That's not quite what this administration is doing.
Revenue is not being sought from all possible contributors and lower paid and public sector workers are being aggressively penalised. I believe the government's strategy is relentlessly dishonest. It should be resisted for those reasons.
A proper review of pensions, including the universal pension, should be initiated. There's pain ahead, but let it be the product of honest debate and the path to an improved and equitable system. The misery of retirement looming for many in the private sector is not a reason to blindly push the public sector down too, it's reason to properly tackle the problem.
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So in summary, are we saying
- its true that the public sector pension scheme is sustainable, in the sense that there's enough money in the scheme as it stands.
And, based on these facts people argue that they shouldn't strike? I find that pretty gobsmacking. OK, public sector pensions are the envy of many in the private sector, but surely the answer to this is to improve the private sector pensions?
Nobody has answered my question re whether public sectors workers getting employer contributions in the order of 4 - 8% of salary greater than private sector workers is 'sustainable'. Obviously leaving things as they are means they will continue to get this additional contribution going forwards and it appears unarguable that there are pressures on public sector funding in all areas with the current state of public finances.
On the second pont of improving private sector pensions I can't imagine that increasing company contributions by 4%+ (how many billions a year is that?!) is a likely option.
We live longer - how can we expect to retire at the same age as our parents without either contributing significantly more or having less money?
I believe the term used for the increased employers contribution is 'deferred salary'... As in you get less now but more in the long term. Public sector wages were/are/soon will be at this rate, lower than their private sector equivalents etc.. And this was part of the payback.... Thats what I've been told not necessarily fully believe..
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IanP - the question of what is sustainable is a difficult one. One way or another, old people need enough money to live. That means a pension which supports them.
The money for that has to come from somewhere. You totally reject increasing employer contributions in the private sector, yet the alternative is for the employee to shoulder the burden. Either way, it's money taken out of the economy, with all that implies.
What is unsustainable is the fact that many private sector workers have NO pension provision and most have pensions which will be insufficient. Unless we want to simply cull old people, we're spending money now that we need to save until later. Thats unsustainable.
As to the implied position you take that public sector workers should contribute to austerity, well they already are. Their wages will drop in real terms by a similar amount to the private sector (albeit slightly more slowly), they have seen and will see massive redundancies. According to the IFS they can expect this to continue for two years into the NEXT parliament, well after growth has returned to the private sector.
All this is necessary. I suspect the unions will even accept a deal with two of the three government proposals included (they already have conceded moving from RPI to CPI). However, it is just wrong to hit them with a triple whammy of paying more, working longer and getting less at the end.
I had a look on the pensions calculator. A "typical" 30 yr old schoolteacher loses 3% on their salary, works 3 years longer, and gets £6000/yr less for their sacrifice. No wonder they're on strike.
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...and teachers are striking aren't they?
I thought they were striking because they've got to pay a bit more and work a bit longer, but then......so does everyone else. Its a simple self-evident fact {etc}
I suspect I may be confused by the points tomtom is getting at. :blink:
Slack-line, I agree with your last point. I mostly agree with what Tomtom has posted, which has never happened to me before, tbh. Try this:
Thanks for the perspective there JR, I clearly misinterpreted what tomtom had written, and as I wrote need to educate myself a bit more about the issues, and your post and others in this thread have helped greatly, thank you all.
I personally don't envy teachers at all and think that most work damn hard at a difficult job as it has always been patently obvious that they have to put in a lot more hours than they are contracted to do (that and the fact I've no interest in teaching as an activity in and of itself as I remember being at secondary school and a large proportion of other kids at the time having no interest or desire to actually learn whilst at school and just generally dicking around and being disruptive making it hard for teachers to actually do what they've been employed to do).
I've never agreed with the gov't letting off companies who owe large tax bills, but the issue of academy's isn't one I've even given any consideration to as its of zero relevance to me (being childless), another area I've not bothered to inform myself about as there are only so many hours in each day. That said I disagree with the privatisation of education (and of course healthcare) at any level, as its a 'service' that should be run for its own intrinsic benefit to society and not to turn a profit.
It isn't any surprise that a financial incentive is required to entice staff in any line of work, although there is already variation in the standards of those employed as nurses and teachers (personally I disagree with league tables by which hospitals and schools are ranked, funnel plots are far fairer means of assessing variation in performance, but I digress). I guess if there is a defecit of applicants then employers would have to revise what they are offering when they can't recruit enough people (and they couple of grand that was being offered to new maths/science teachers was a piss-take).
The issue of having to work at a job that you may not be physically suited for is a wider issue that an aging society will have to address. I doubt my mechanic mate is going to be able to lie around under cars in winter fixing them, or hoist engines out when he's 60, let alone 65 or 67. There are all walks of life where this will be a problem and the government/society will have to address this.
I rarely believe much of what the government says, particularly the statistics which are spouted out, often without context or any explanation of how they're derived. I find the aforementioned Factcheck (http://blogs.channel4.com/factcheck) and Fullfact.org (http://www.fullfact.org) to be useful in this regard. Personally I'm pretty disenfranchised with democracy in this country, it doesn't work fairly at all and has little value as its all just petty bickering, opposing the other parties just because they're the opposition and when one team does get into power it just spends its time undoing the last parties policies and whatever else it can to get re-elected, rather than using evidence as a basis for policies.
I'm still not sure whether I support the strikes now (as I don't think its necessarily the biggest impact that can be made and massively inconveniences others, alternatives might be working to rule), but I do understand more about the issues that have pushed people to strike and have some empathy with that.
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I think IanP's question, which would also be mine, is whether the current pension pot and the current rate of paying in, can sustain pensions into the future once you factor in extended life expectancy? Is this a static pot, or like most pensions is its sustainability based on assumptions about the quality of what it's invested in (which are now no longer valid)? If it can be sustained, then this would seem like a backdoor method of pulling money out of the public sector without cutting more salaries or jobs. If it can't, then whatever deal was promised in the past would still require government subsidy that arguably cannot be justified when everyone else has much poorer pension provision.
Comparing things to the private sector on the basis that growth is predicted to return in a few years, after all I've read, seems wishful thinking. The current deficit reduction plan and predictions of growth returning are based on two things: 1) no collapse of the euro (which is a 50/50 bet at best it would seem) 2) the interest rate we pay on debt staying more or less the same, aren't they? My fear is that if the euro goes under our economy will nosedive, debts spiral and our interest rate goes up. Alternatively, if the eurozone sorts its self out then suddenly our debt becomes the least attractive in europe and our interest rate still goes up. Net result is all predictions are wrong, this isn't the last round of austerity and the state will have to be dramatically reduced in size. In which case shaving a bit off pensions is going to seem irrelevant.
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IanP - the question of what is sustainable is a difficult one. One way or another, old people need enough money to live. That means a pension which supports them.
The money for that has to come from somewhere. You totally reject increasing employer contributions in the private sector, yet the alternative is for the employee to shoulder the burden. Either way, it's money taken out of the economy, with all that implies.
What is unsustainable is the fact that many private sector workers have NO pension provision and most have pensions which will be insufficient. Unless we want to simply cull old people, we're spending money now that we need to save until later. Thats unsustainable.
As to the implied position you take that public sector workers should contribute to austerity, well they already are. Their wages will drop in real terms by a similar amount to the private sector (albeit slightly more slowly), they have seen and will see massive redundancies. According to the IFS they can expect this to continue for two years into the NEXT parliament, well after growth has returned to the private sector.
All this is necessary. I suspect the unions will even accept a deal with two of the three government proposals included (they already have conceded moving from RPI to CPI). However, it is just wrong to hit them with a triple whammy of paying more, working longer and getting less at the end.
I had a look on the pensions calculator. A "typical" 30 yr old schoolteacher loses 3% on their salary, works 3 years longer, and gets £6000/yr less for their sacrifice. No wonder they're on strike.
I'm not totally rejecting anything - it just seems very unlikely that UK employers could absorb a 4-8% increase in employee costs in the current environment. My position on pensions is that we need to live in the real world - it seems that there's a lucky generation who has gained from improving health and longer lifespans while still retiring on the basis of plans which were put in place many years before based on very different assumptions. Do people in there 30's and 40's now really expect to have the same pension arrangements as their parents?
Interested in where you got your £6000 less pension figure - I had a quick look on the Teachers pension calculator and couldn't find a proper comparison. Comparing average salary pension to final salary is pretty complicated and needs quite a lot of assumptions (guesses!) - the lack of proper information can't help in any attempt to have a mature debate between the parties.
Even before the current financial problems in the developed world the expectation of retirement in your early 60's was being challenged - as per Ru's post if the western world really is starting a period of stagnation when compared to the up an coming economies of the developing world then striking over pensions really could start to look like fiddling while Rome burns.
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And, based on these facts people argue that they shouldn't strike? I find that pretty gobsmacking. OK, public sector pensions are the envy of many in the private sector, but surely the answer to this is to improve the private sector pensions?
I'm not saying they shouldn't strike, I'm saying I can't see what it will acheive.
If FatKid went on strike and noone could see their GPs for a day, do you think Doctors would get public support? Or do you think the papers would be full of "Lazy bastard GPs go on strike whilst earning £120,000"?
As an aside, as FatKid briefly alluded to, this may be true on paper but it's spin really. OK, so gross pay is £120k- take off employers and employees contributions for pension (Partners are self employed) then you lose over 20% (soon to be increased to over 22%). Add in >50% tax, with loss of the 10% allowance, and take off the 10K of compulsory fees etc then a net pay of £30k doesn't sound as impressive. I'm not going to argue it's shit money, but it's not 120K in any way. There's a lot of people bring home more than £2500 net a month.
PS I am not working as a Partner so I'm not moaning about my own circumstances.
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- the lack of proper information can't help in any attempt to have a mature debate between the parties.
I find the amount of spin from both sides depressing.
One question I've always wondered, if life in the public sector is so rosy, the pay equivalent and the pensions guilt edged, how come all my private sector money grabbing fat cat chums and I aren't fighting to get a job in the public sector?
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A nurse, a banker, a tory mp and a daily mail reader are all sat round a table on which there is a plate with 10 bicuits on it. The banker reachs across grabs and eats 9 of the biscuits, the tory mp leans across and whispers to the daily mail reader " watch it that nurse is after your biscuit".
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And, based on these facts people argue that they shouldn't strike? I find that pretty gobsmacking. OK, public sector pensions are the envy of many in the private sector, but surely the answer to this is to improve the private sector pensions?
I'm not saying they shouldn't strike, I'm saying I can't see what it will acheive.
If FatKid went on strike and noone could see their GPs for a day, do you think Doctors would get public support? Or do you think the papers would be full of "Lazy bastard GPs go on strike whilst earning £120,000"?
As an aside, as FatKid briefly alluded to, this may be true on paper but it's spin really. OK, so gross pay is £120k- take off employers and employees contributions for pension (Partners are self employed) then you lose over 20% (soon to be increased to over 22%). Add in >50% tax, with loss of the 10% allowance, and take off the 10K of compulsory fees etc then a net pay of £30k doesn't sound as impressive. I'm not going to argue it's shit money, but it's not 120K in any way. There's a lot of people bring home more than £2500 net a month.
PS I am not working as a Partner so I'm not moaning about my own circumstances.
If you're self employed then your pension contributions reduce your income for higher rate tax purposes so if you were paying 20% on £120k then that would be £24k. This would mean your income would be classed as under £100k for the purposes of calculating basic / higher rate tax and the personal allowance (i.e. no loss of personal allowance).
Plus you're not going anywhere near the 50% tax band as that's on taxable income OVER £150k.
That's before you take into account other allowable expenses. I'm assuming "£10k of compulsory fees" falls into this category?
Even if you only allowed for this (in the real worls there will be loads more you can claim) then the actual tax / NI due will be around £32k.
So. £120k salary - £24k pension - £32k tax - £10k fees = £54k net or £4500 a month.
:smartass:
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A nurse, a banker, a tory mp and a daily mail reader are all sat round a table on which there is a plate with 10 bicuits on it. The banker reachs across grabs and eats 9 of the biscuits, the tory mp leans across and whispers to the daily mail reader " watch it that nurse is after your biscuit".
Goes to show....you shouldn't read the daily fail. :clown:
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I know it's not the 50% band, it's 40% with loss of the 10% allowance. Although I wasn't aware Re pensions influencing band.
Although I will bow to your superior knowledge! Although the point of lack of support still remains. And that I need to change jobs....
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I think IanP's question, which would also be mine, is whether the current pension pot and the current rate of paying in, can sustain pensions into the future once you factor in extended life expectancy? Is this a static pot, or like most pensions is its sustainability based on assumptions about the quality of what it's invested in (which are now no longer valid)? If it can be sustained, then this would seem like a backdoor method of pulling money out of the public sector without cutting more salaries or jobs. If it can't, then whatever deal was promised in the past would still require government subsidy that arguably cannot be justified when everyone else has much poorer pension provision.
Comparing things to the private sector on the basis that growth is predicted to return in a few years, after all I've read, seems wishful thinking. The current deficit reduction plan and predictions of growth returning are based on two things: 1) no collapse of the euro (which is a 50/50 bet at best it would seem) 2) the interest rate we pay on debt staying more or less the same, aren't they? My fear is that if the euro goes under our economy will nosedive, debts spiral and our interest rate goes up. Alternatively, if the eurozone sorts its self out then suddenly our debt becomes the least attractive in europe and our interest rate still goes up. Net result is all predictions are wrong, this isn't the last round of austerity and the state will have to be dramatically reduced in size. In which case shaving a bit off pensions is going to seem irrelevant.
The answer to the first part is a yes. Public sector pensions don't work like other schemes. In essence, the government takes money in, and commits to pay the benefits defined. Based on reforms already implemented to public sector pensions, the burden on the public purse is already falling, and is set to stabilise at a lower level. So it is clearly "affordable" in that sense, even in the light of rising life expectancy. This is because the public sector has already made commitments to lose some of their pension benefits, and to shoulder the burden of future cost increases themselves. The tory proposals to increase contributions are *on top* of this, and is basically a cash-grab.
As to your second point, all plans are made on the basis of future expectations of growth. My point is that, if growth returns the private sector will be able to look forward to rising employment and wages. The public sector will face at least 5 more years of wage restraint and job cuts. The job losses announced this week is more than the entire civil service, for context.
If the euro goes south, and growth doesn't return things will get worse for everyone, but from a baseline where prospects for those in the public sector look worse at the moment.
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I know it's not the 50% band, it's 40% with loss of the 10% allowance. Although I wasn't aware Re pensions influencing band.
Although I will bow to your superior knowledge! Although the point of lack of support still remains. And that I need to change jobs....
Sorry to be a pedant but as it's the one area where I do actually know what I'm on about......
There is no 10% band any more (unless you only have savings income) the loss of personal allowance thing is that anyone who earns more than £100k loses part (or all) of the amount which they pay nothing on (on a sliding scale).
Everyone starts with a personal allowance of £7475 on which they pay no tax but once you earn over £100k it is reduced by £1 for every £2 of income and is therefore wiped out once income reaches £114,950.
:geek:
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Do you ever wish you hadn't bothered? ;)
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I'm not totally rejecting anything - it just seems very unlikely that UK employers could absorb a 4-8% increase in employee costs in the current environment. My position on pensions is that we need to live in the real world - it seems that there's a lucky generation who has gained from improving health and longer lifespans while still retiring on the basis of plans which were put in place many years before based on very different assumptions. Do people in there 30's and 40's now really expect to have the same pension arrangements as their parents?
No. no-one expects that, which is why the public sector has already accepted large cuts to their pensions, and will (in all probability) accept more. That doesn't mean they should meekly sit on their hands whilst the government robs them blind.
Interested in where you got your £6000 less pension figure - I had a quick look on the Teachers pension calculator and couldn't find a proper comparison. Comparing average salary pension to final salary is pretty complicated and needs quite a lot of assumptions (guesses!) - the lack of proper information can't help in any attempt to have a mature debate between the parties.
Even before the current financial problems in the developed world the expectation of retirement in your early 60's was being challenged - as per Ru's post if the western world really is starting a period of stagnation when compared to the up an coming economies of the developing world then striking over pensions really could start to look like fiddling while Rome burns.
The £6k number came from newsnight last night. For a 35 year old female school teacher. Her current pension is around £18,000 / yr. On the telly, they said this would go down to £12K/yr. Based on the teachers pension calculator, and the government's excel spreadsheet this seems about right, although I had to make assumptions about salary growth etc. It will be in this ballpark figure.
I don't know why you compare to this straw man of retiring at 60 on the same pensions our parents had. No-one our age currently gets that, or is lobbying for it.
If we leave things as they are, public sector workers will retire at the state pension age, which for someone in their mid-30s is likely to rise to around 70 (it will already be 68). On average, they'll receive a pension of £7k/yr. If you are seriously proposing a system where people work longer than that, or live off smaller pensions than that I think you are being unreasonable.
Of course if the euro collapses, growth doesn't return etc then we'll all be eating decaying corpses instead. But I re-iterate the current proposal is assuming that won't happen.
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So, basically what this boils down to is:
Tories want to get a chunk of cash for deficit reduction.
They have 2 options:
1) the fair way - tax high earners more and force big companies to actually pay the corporate tax they are meant to. This protects lower earners and is spread across the nation (public/private)
2)basically tax public sector workers via the backdoor by increasing contributions etc.
The problem with 1, is that it will piss off all the influential tory-voting and tory sympathising fat cats, so it's just not going to happen.
Whereas 2, well, general there's a lot of public resentment (albeit, probably unfounded) about public sector pensions, so they might as well hammer that...battle through a few strikes....get what they want and keep their rich chums happy?
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The answer to the first part is a yes. Public sector pensions don't work like other schemes. In essence, the government takes money in, and commits to pay the benefits defined. Based on reforms already implemented to public sector pensions, the burden on the public purse is already falling, and is set to stabilise at a lower level. So it is clearly "affordable" in that sense, even in the light of rising life expectancy. This is because the public sector has already made commitments to lose some of their pension benefits, and to shoulder the burden of future cost increases themselves. The tory proposals to increase contributions are *on top* of this, and is basically a cash-grab.
So there's no pot, but the state's cash commitment to public sector pensions is falling and this fall equals, outweighs or already factors in future increases in life expectancy? Where's this from, as it doesn't seem to be what the government is saying (not that that means much)?
You're right in saying that the current proposal doesn't factor in the collapse of the euro or many other factors, but the likelyhood of these events happening is so real, and the chances of these current proposals being completely dwarfed by other cuts in the next year is so high, that burning the public support bridges now may seem a little counterproductive later on.
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Do you ever wish you hadn't bothered? ;)
My work here is done. :P
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We're all going to be fucked aren't we; anyone got any knowledge about moving to Canada? :'(
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I'd have come back with a witty rejoinder, but I'm on strike.
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Glad we've got some informed, rigorous debate anyway. The first two pages had me afraid UKB had lost it.
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The £6k number came from newsnight last night. For a 35 year old female school teacher. Her current pension is around £18,000 / yr. On the telly, they said this would go down to £12K/yr. Based on the teachers pension calculator, and the government's excel spreadsheet this seems about right, although I had to make assumptions about salary growth etc. It will be in this ballpark figure.
I don't know why you compare to this straw man of retiring at 60 on the same pensions our parents had. No-one our age currently gets that, or is lobbying for it.
If we leave things as they are, public sector workers will retire at the state pension age, which for someone in their mid-30s is likely to rise to around 70 (it will already be 68). On average, they'll receive a pension of £7k/yr. If you are seriously proposing a system where people work longer than that, or live off smaller pensions than that I think you are being unreasonable.
I said early 60's (not 60) and we're talking about moving to later 60's (not 70) so I don't think we're talking straw man arguments.
Anyway on the nominal 35 year old teacher, I've just entered the following details into the pension estimator (http://www.teacherspensions.co.uk/calculator/calculator.html (http://www.teacherspensions.co.uk/calculator/calculator.html) ), all figures in todays money.
- Current salary £32,000
- End salary £58,000 (assuming 2% growth above inflation)
- Started as teacher at age 25 so 10 years service in old scheme.
This gives retirement at age 66, retirement income of £30,400, lump sump £28.800, so in excess of 50% of final salary. So I'm still not sure where this 33% drop in salary comes from unless I'm looking up the wrong calculators.
Where does the average pension of public sectors works of 7k come from - is this for people who've worked full time in the public sector for 30+ years? If not it's a bit of a meaningless figure.
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Bit of a tangent this, but personally I think this thing about ever rising life expectancies is drivel. The idea that we’re all going to live to 100 is new-minted poo. I’d say it’s more likely that we’ll hit peak life expectancy soon and will then see it decline somewhat. Working longer, for less money followed by retirement on a pittance, coupled with a shrinking NHS doesn’t strike me as an ideal recipe for longevity. It may well be that we’ll look back and see that the pensioners of today get a better deal than any before or since and thus live longer. Plus I think most of the low hanging fruit on health gains have been had (reduced numbers smoking, antibiotic efficacy, surgical innovations etc). Or the euro will crash and we’ll all get eaten by Littlefairs next week, problem solved.
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Bit of a tangent this, but personally I think this thing about ever rising life expectancies is drivel. The idea that we’re all going to live to 100 is new-minted poo. I’d say it’s more likely that we’ll hit peak life expectancy soon and will then see it decline somewhat. Working longer, for less money followed by retirement on a pittance, coupled with a shrinking NHS doesn’t strike me as an ideal recipe for longevity. It may well be that we’ll look back and see that the pensioners of today get a better deal than any before or since and thus live longer. Plus I think most of the low hanging fruit on health gains have been had (reduced numbers smoking, antibiotic efficacy, surgical innovations etc). Or the euro will crash and we’ll all get eaten by Littlefairs next week, problem solved.
The whole financial crisis might be part of a massive feedback loop that both limits life expectancy and curbs environmental damage. I'm going to keep an emergency biscuit in my pocket next time I meet up with Stu though.
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Within the current NHS pension scheme you can go for larger monthly payments and smaller lump sum or large lump sum and smaller monthly payments.
If you go for the larger monthly payments you need to live to at least your early 70s to get the benefit of this deal.However most of my male colleagues who have or are about retire do not take this option because it seems few survive till 70.
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Its not that we're all going to live to 100, nor that they will continue to rise, but that like it or not life expectancy has increased from the time when pensions were designed/planned as this excerpt by Hans Rosling nicely demonstrates.....
Hans Rosling's 200 Countries, 200 Years, 4 Minutes - The Joy of Stats - BBC Four (http://www.youtube.com/watch?v=jbkSRLYSojo#ws)
There is of course still variation within each countries as is demonstrated in the video for regions in China, and in most western societies the greatest disparity in life expectancies shows correlation with 'inequaility' (and in countries with large inequality the overall life expectancy for those at the bottom and top of the scale, so poor and rich, is reduced compared to countries where the differences in inequality are less, for more on this see The Spirit Level : Why Equality is Better for Everyone (http://www.equalitytrust.org.uk/) but its heavily reliant on categorisation of continuous variables, possible cherry picking of data, and only quantifies correlation, which doesn't equate to causation, balanced nicely by counter arguments in The Spirit Level Delusion: Fact-checking the Left's New Theory of Everything (http://spiritleveldelusion.blogspot.com/)) :off:
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Its not that we're all going to live to 100, nor that they will continue to rise, but that like it or not life expectancy has increased from the time when pensions were designed/planned as this excerpt by Hans Rosling nicely demonstrates.....
Excellent program. For those with a geeky interest in these sort of things Radio 4's statistics in the news strand More or Less is often interesting. Podcasts are available here http://www.bbc.co.uk/podcasts/series/moreorless#playepisode10 (http://www.bbc.co.uk/podcasts/series/moreorless#playepisode10) including one on public sector pay :-\.
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Slack----line - Yes I know that, but it doesn't stop politicians and the media routinely trotting out the notion that life expectancy will just keep going up and up. e.g. http://news.bbc.co.uk/1/hi/health/1977733.stm (http://news.bbc.co.uk/1/hi/health/1977733.stm)
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Anyway on the nominal 35 year old teacher, I've just entered the following details into the pension estimator (http://www.teacherspensions.co.uk/calculator/calculator.html (http://www.teacherspensions.co.uk/calculator/calculator.html) ), all figures in todays money.
- Current salary £32,000
- End salary £58,000 (assuming 2% growth above inflation)
- Started as teacher at age 25 so 10 years service in old scheme.
Firstly it was a primary school teacher. Their main salary scale rises incrementally from £21,102 to £30,842 so your current salary is too high. With a pay freeze/slow growth for several years and inflation at 5% I think your salary growth rate would raise a wry smile from the teacher in question. That should account for a lot of the difference.
The average public sector pension came from this bbc report (http://www.bbc.co.uk/news/business-15925017 (http://www.bbc.co.uk/news/business-15925017)), which seems to be based on data from the National Association of Pension funds, though it's not totally clear.
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So there's no pot, but the state's cash commitment to public sector pensions is falling and this fall equals, outweighs or already factors in future increases in life expectancy? Where's this from, as it doesn't seem to be what the government is saying (not that that means much)?
This is from the Hutton report. It's been described by Hutton himself as "a bit of a guess", as well it might be, since it requires assumptions about economic growth, public sector employment levels and renumeration levels as well as changes in life expectancy. Nevertheless, the IFS and OBR agree, all predicting falling or flat contributions, as a fraction of GDP.
This fall factors in future increases in life expectancy (based on actuarial calculations made in 2009). It includes the assumption that the index linking of pensions moves to CPI. It also includes assumptions about economic growth that now look very optimistic, but the assumptions about employment levels and pay deals in the public sector also failed to take into account Osborne's fabulous generosity, so it probably balances out in the wash...
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From what I can see...
Economics (noun) A bit of a guess.
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So in summary, are we saying
- its true that the public sector pension scheme is sustainable, in the sense that there's enough money in the scheme as it stands.
- the Hutton report predicts that the pensions burden on the state will actually decline in the future
- public sector workers took a significant cut in their pensions already, under labour
- they're now being asked to pay more into their schemes, work longer AND receive less when they retire
- this in the context of a wage freeze when living costs are rising rapidly.
And, based on these facts people argue that they shouldn't strike? I find that pretty gobsmacking. OK, public sector pensions are the envy of many in the private sector, but surely the answer to this is to improve the private sector pensions?
This does just look like a raid on public sector workers, because it's more politically advantageous than tax rises for all. I'm surprised so many people seem to agree with the government line
Good summary Stu. Add to that the news from those well known left wing rabble rousers the Institute for Fiscal Studies that the net effect of the Chancellors recent rearrangement of the deck chairs on the Titanic is to take money from the poor and give it to the rich http://www.politics.co.uk/news/2011/12/01/autumn-statement-will-hit-the-poor-to-help-the-rich-experts (http://www.politics.co.uk/news/2011/12/01/autumn-statement-will-hit-the-poor-to-help-the-rich-experts) and those of you who feel that strikes are pointless may get the chance to revisit this argument very soon....
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And all I can say with regard to what the government is saying is that Mark Serwotka directly accused Francis Maude of telling lies about pensions Newsnight last night. Despite being given several chances to do so (including a direct invitation from Paxo), Mr Maude made no attempt to deny it.
see http://www.bbc.co.uk/news/uk-politics-15984068 (http://www.bbc.co.uk/news/uk-politics-15984068) from 5:00
I think that tells you all you need to know about this government's approach to spin. Meet the new boss, same as the old boss...
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Slack----line - Yes I know that, but it doesn't stop politicians and the media routinely trotting out the notion that life expectancy will just keep going up and up. e.g. http://news.bbc.co.uk/1/hi/health/1977733.stm (http://news.bbc.co.uk/1/hi/health/1977733.stm)
The scientist whose work they are citing (http://www.sciencemag.org/content/296/5570/1029.full) is also quoted in the BBC article as saying...
I think there is a ceiling, but we don't know where it is. We haven't got there yet.
(And you can easily increase the number of centenarians by having greater variation around the mean).
Personally I hate the way science and statistics is given spin.
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Firstly it was a primary school teacher. Their main salary scale rises incrementally from £21,102 to £30,842 so your current salary is too high. With a pay freeze/slow growth for several years and inflation at 5% I think your salary growth rate would raise a wry smile from the teacher in question. That should account for a lot of the difference.
The average public sector pension came from this bbc report (http://www.bbc.co.uk/news/business-15925017 (http://www.bbc.co.uk/news/business-15925017)), which seems to be based on data from the National Association of Pension funds, though it's not totally clear.
Readjusting the figures for starting salary for 27k, end salary of 32k (very small increase in real salary) gives a pension of 18.5k which looks even better as a percentage of final salary (though that salary may not look very attractive by that point!).
All very strange and probably just reinforces my view that this whole subject needs less hot air and more considered information and analysis from both sides.
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This is from the Hutton report. It's been described by Hutton himself as "a bit of a guess",
Ah ok. So it was a guess in the first place and since then things have got significantly worse. I wouldn't be putting any money on the pensions being sustainable. I ought to read the report really.
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You probably won't want to read the report - it's a few hundred pages long
I'm not sure that things have got "significantly worse" from the point of view of pension affordability, as a fraction of GDP. Sure the economy won't grow as predicted but then neither will public sector wages, and there'll be fewer people employed in the public sector as well.
I don't know what you mean by "I wouldn't be putting any money on the pensions being sustainable". There's no better forecast than those produced by Hutton, IFS and OBR. Sure forecasts are unreliable, but since when have governments based policy on anything other than the forecasts available? As I argue above, there's no reason that future economic shocks will make them less affordable, since the government is tightly controlling public sector employment...
Sure, it's a bit of a guess, but as slack line says, so is all economics. This doesn't strike me as any more of a guess than anything else.
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I'm being cynical based on the fact that most forecasts made in the last 2-3 years have been too optimistic.
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Good work Stu - it's quite a tonic to hear some sensible fact-based discussion. I despair at the way this government is driving wedges between everybody: divide and rule I suppose.
I work in the private sector but support the strike (and I don't even have a pension - but ultimately that is my choice).
Yesterday my wife went to work (she works for a homeless charity) while I spent the day hanging out with our kids. I suppose I could bitch about the enforced loss of income, but I had a great time, even ended up at the climbing wall in the afternoon with my son.
It did strike me that there must be lots of households with a mix of public/private sector workers. or failing that, people (like me) who have/had parents who worked in the public sector. Sympathy is bound to cut across a broad range of families and people.
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Anyway on the nominal 35 year old teacher, I've just entered the following details into the pension estimator (http://www.teacherspensions.co.uk/calculator/calculator.html (http://www.teacherspensions.co.uk/calculator/calculator.html) ), all figures in todays money.
- Current salary £32,000
- End salary £58,000 (assuming 2% growth above inflation)
- Started as teacher at age 25 so 10 years service in old scheme.
This gives retirement at age 66, retirement income of £30,400, lump sump £28.800, so in excess of 50% of final salary. So I'm still not sure where this 33% drop in salary comes from unless I'm looking up the wrong calculators.
Total, utter, tosh. £58,000 for a mainscale teacher?? Currently salary increase is 0% not 4.9+2 = ~7% annually.
The union guidance on why and where the calculator is unreliable is far too lengthy to want to reproduce here but in essence - it's unreliable. Ignore it.
Where does the average pension of public sectors works of 7k come from - is this for people who've worked full time in the public sector for 30+ years? If not it's a bit of a meaningless figure.
It is a useful figure for a spokesman to refer to - in other words, misleading. The average includes part-timers, late arrivals, those who only worked in the public sector for a few years. A statistical mean - which is statistically speaking, meaningless.
What isn't meaningless is the cash grab by the Tories on those who provide essential services in many cases for an embarassingly low wage. It needs fending off because revenue is not being sought from those who are equipped to pay in a similar and equitable share.
The dire state of private pensions is a national embarassment. In my view we should have a centrally funded pension scheme where all can pay in, private as well as public, and adjustments are spread across society as a whole. It wouldn't stop politicians being thieves, but it would be provide liquidity for the government and therefore incentivise its maintenance.
I'd pay tax for that. But this is just a redistribution from those at the bottom towards those at the top which does nothing to help the embattled private sector worker with a miserly pension.
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Total, utter, tosh. £58,000 for a mainscale teacher?? Currently salary increase is 0% not 4.9+2 = ~7% annually.
The union guidance on why and where the calculator is unreliable is far too lengthy to want to reproduce here but in essence - it's unreliable. Ignore it.
Not utter tosh, just a number plucked out of the air assuming some real terms income increase over the next 30 years. See my later answer based on low real terms increase over 30 years from 27k to 32k - the end result still gives an pension in excess of 50% of final salary. As to whether the calculator is correct I can't say - but this highlights the need for real information and understanding. I spoke to someone down the wall who was all against the robbing government but didn't understand that the proposals impact future pension only not already earned entitlement.
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For a teacher to end up on 58k they would have to be something like assistant/deputy head level.
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For a teacher to end up on 58k they would have to be something like assistant/deputy head level.
What was a teachers salary in 1982? As I said above the number was based on a nominal real terms increase of 2% a year over 30 years , I'm more than happy to accept that that was generous and we can all expect less significant (if any) real terms increase in the next 30 years - the calculations and the point made (that the end pension is in excess of 50% of final salary) are same based on this assumption instead.
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It is a useful figure for a spokesman to refer to - in other words, misleading. The average includes part-timers, late arrivals, those who only worked in the public sector for a few years. A statistical mean - which is statistically speaking, meaningless.
Means are only meaningless when you don't know the variance (or its square route, the standard deviation). Although when distributions are skewed the median and inter-quartile range are more appropriate. :geek:
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Good work Stu - it's quite a tonic to hear some sensible fact-based discussion. I despair at the way this government is driving wedges between everybody: divide and rule I suppose.
I work in the private sector but support the strike (and I don't even have a pension - but ultimately that is my choice).
Yesterday my wife went to work (she works for a homeless charity) while I spent the day hanging out with our kids. I suppose I could bitch about the enforced loss of income, but I had a great time, even ended up at the climbing wall in the afternoon with my son.
It did strike me that there must be lots of households with a mix of public/private sector workers. or failing that, people (like me) who have/had parents who worked in the public sector. Sympathy is bound to cut across a broad range of families and people.
:thumbsup:
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It is a useful figure for a spokesman to refer to - in other words, misleading. The average includes part-timers, late arrivals, those who only worked in the public sector for a few years. A statistical mean - which is statistically speaking, meaningless.
Means are only meaningless when you don't know the variance (or its square route, the standard deviation). Although when distributions are skewed the median and inter-quartile range are more appropriate. :geek:
I've always preferred being called Mr Median rather than Mr Average ;)
Been some good debate on here... good effort.
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Seems to me there are several misconceptions and gaps in this thread.
Technical one first...the TPS pension calculator inflation adjusts your salary, so your final salary you enter is the same as your current (unless you get promoted or are not at the top of the internal pay scale for the grade). Its not explained very well.
Economic one now: Hutton factored in likely longevity increases and everything else. Pensions were then renegotiated to deal with the changes required. There is no long term affordability issue. There are guestimates, sure but these are unlikely to be massive issues as the whole idea of regular negotiations with actuaries is to fine tune as required. Growth got worse but wages got worse faster. Yes this does mean Francis Maude is lying: the government is on an idealogical drive not an actuarial one.
Next point no one seems to have mentioned is that typical public sector salary levels have dropped 10% wrt inflation in the last two years and likely to drop 5-10% in the next two. (If you really want to depress yourself you can add in the amount the pound has devalued compared to the western world average currency bag). Like the private sector the highest paid in the public sector often managed to wangle a pretty decent pay rise.
Longevity... when you make people work harder and longer they die earlier. Those who retired a decade ago got an amazingly good deal and also on average probably lived healtheir lives than the young are currently living (smoking aside). I think costs may well drop after the changes.
Private sector having a go at the public sector: because someone got mugged we should deal with the muggers not suggest everyone else gets mugged too. Private sector pensions for the low to middling paid are a national scandal and this will bite all taxpayers eventually.
Strikes: as a moderate Trade Unionist I'm often depressed with the keeness some of my comrades display towards this form of industrial action. Sometimes though you have to go on strike: this one is necessary as I just dont see how you can have such a major dispute without it. I could be on stike for 2 whole years before I lose out (if I win). Most other forms of action short of a strike (except working to rule) will cause a full days pay deduction in any case.
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Private sector having a go at the public sector: because someone got mugged we should deal with the muggers not suggest everyone else gets mugged too.
Well said.
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I had a minor revelation this morning.
Demotivating public sector workers will reduce their performance - this will cause a slight drop in quality of life for the population, which in turn should reduce the average life expectancy by a small amount. This will make pensions slightly cheaper and allow the retirement age of public sector workers to be lowered again. The population will have learned their lesson and public sector workers will just work shorter French style weeks so that life expectancy doesn't creep back up. Result.
Adam Smith's Invisible Hand saves the day again. Although some politician or other will claim credit for the result.
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...Yes this does mean Francis Maude is lying: the government is on an idealogical drive not an actuarial one.
Absolutely. I'm surprised that this point isn't brought up more often.
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Economic one now: Hutton factored in likely longevity increases and everything else. Pensions were then renegotiated to deal with the changes required. There is no long term affordability issue.
But then Hutton now says that the economy has tanked since he made his projections in a long term never going to recover lost ground kind of way so further change is necessary. Tricky one.
http://www.bbc.co.uk/news/uk-16021345 (http://www.bbc.co.uk/news/uk-16021345)
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I'm interested in this idea that public sector pensions are affordable as they are. How can this be with an aging population and an expanding public sector? Can someone summarise?
That aside, there's a more serious problem with the economy in general when the public sector (net tax consumers) starts reach the size of the private sector (net tax producers). This is clearly unsustainable and there are only 3 solutions:
1. Grow the private sector
2. Shrink the public sector
3. Kill everyone in the whole world and drown Middlesex in a vat of wine
sorry 4 solutions....
4. Pink Anasazi
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But then Hutton now says that the economy has tanked since he made his projections in a long term never going to recover lost ground kind of way so further change is necessary.
http://www.bbc.co.uk/news/uk-16021345 (http://www.bbc.co.uk/news/uk-16021345)
By Hutton I meant the careful, detailed report produced by a team that he chaired. I'm rather perplexed what has recently happened to the man: he seems to be making odd and inconsistent contributions that are easily challenged. He did it a few weeks back and backed down. This time he questioned the GDP assumptions (this will increase costs by a few percent) but failed to mention the recent (and projected) drops in pay cf CPI (this will reduce costs more than the GDP increases: currently nearly 10% and likely to reach at least 16%). He also failed to pick up the increasing liklihood of wider public sector job losses (also reducing costs) cf the report.
Its obvious the situation needs reviewing but base this on facts, not fear and ideology.
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I'm interested in this idea that public sector pensions are affordable as they are. How can this be with an aging population and an expanding public sector? Can someone summarise?
That aside, there's a more serious problem with the economy in general when the public sector (net tax consumers) starts reach the size of the private sector (net tax producers). This is clearly unsustainable and there are only 3 solutions:
1. Grow the private sector
2. Shrink the public sector
3. Kill everyone in the whole world and drown Middlesex in a vat of wine
sorry 4 solutions....
4. Pink Anasazi
Quickly, it's because changes were made to the pension schemes to make them cheaper, and the unions agreed that the employee would near the brunt of any future increases in life expectancy.
Also, you've got some funny views on the public/private sector there. Public & private sector alike generate wealth and both pay tax. You may be surprised to learn that most people, both public & private sector are net consumers of tax. It's only in the upper income levels that you pay more than you get back. To call the public sector net tax consumers is to believe that their wages are somehow different to private sector workers. Maybe you should read this
http://timharford.com/2011/12/you’re-wrong-–-we-are-all-wealth-creators/
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Escellent work Offwidth. Particularly the mugger analogy. Call me an old hippy if you like, but I like the idea of common cause, that we are, in a funny kind of way, all in this together....
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To call the public sector net tax consumers is to believe that their wages are somehow different to private sector workers.
Public Sector wages are paid for by taxes, no?
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Public Sector wages are paid for by taxes, no?
Public sector workers are tax payers, no?
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Public Sector wages are paid for by taxes, no?
Public sector workers are tax payers, no?
Does the amount of tax they pay exceed their wage? No.
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Yes, but. What the Tim Harford article says correctly is that both public and private sector work within the economy are value-added. If public services were privatised we'd pay directly rather than via tax.
That certainly holds true for front line services like the NHS police, teachers etc. Although, one could argue that you might get a better level of service if private companies were in direct competition to perform these services.
That aside, what about the questionable jobs like the FSA HR diversity consultant being paid £60k a year or the 'walking co-ordinator' for Islington council on £30k etc. Would we really be that much worse off if these jobs didn't exist?
This all sounds a bit Daily Mail doesn't it? Sorry.
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It does a bit, and you can probably find equally useless people successfully employed in the private sector. Homeopathy, or Carole Caplin spring to mind.
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Public Sector wages are paid for by taxes, no?
Public sector workers are tax payers, no?
Does the amount of tax they pay exceed their wage? No.
No of course not but the rhetoric seems to be that the private sector are the only ones paying tax. The rhetoric also seems to forget that the pensioners currently enjoying their lovely public sector pensions are also major shareholders in The Bank of Mam and Dad and therefore are continuining to contribute substantially to the economy.
The Works (which pays a large amount in tax and employs quite a few people) would not exist without The Bank of Mam and Dad Who Are Either Currently Public Sector or Ex-Public Sector Workers.
Just pointing out that the rhetoric provided by the government ignores the knock-on effects.
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Public Sector wages are paid for by taxes, no?
Public sector workers are tax payers, no?
Does the amount of tax they pay exceed their wage? No.
No of course not but the rhetoric seems to be that the private sector are the only ones paying tax. The rhetoric also seems to forget that the pensioners currently enjoying their lovely public sector pensions are also major shareholders in The Bank of Mam and Dad and therefore are continuining to contribute substantially to the economy.
The Works (which pays a large amount in tax and employs quite a few people) would not exist without The Bank of Mam and Dad Who Are Either Currently Public Sector or Ex-Public Sector Workers.
Just pointing out that the rhetoric provided by the government ignores the knock-on effects.
Amen...
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That certainly holds true for front line services like the NHS police, teachers etc. Although, one could argue that you might get a better level of service if private companies were in direct competition to perform these services.
Lots of right-wingers do, so you've got company. You'll be able to see this in practice in a few years as state education sector is being substantially privatised.
As to whether that will make for better performance, it definitely will ffor those with the cash to buy it. If you can't you're not the right type of voter (for this type of administration) anyway.
That aside, what about the questionable jobs like the FSA HR diversity consultant being paid £60k a year or the 'walking co-ordinator' for Islington council on £30k etc. Would we really be that much worse off if these jobs didn't exist?
What about them? Are you saying they're significant and representative of most public sector work? Or are they weird little herrings of a reddish hue?
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What about them? Are you saying they're significant and representative of most public sector work? Or are they weird little herrings of a reddish hue?
I'm saying that I found two examples from 15 seconds googling, so imagine how many you could find if you actually put some effort into it. If getting rid of two pointless jobs saves the country 100k per year in direct salary costs (not to mention indirect costs and of course pension contributions) then imagine how much the UK taxpayer would be saved if you got rid of them all.
Is that not logical? Or was I born too far South of the Left/Right divide?
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Although, one could argue that you might get a better level of service if private companies were in direct competition to perform these services.
yeah, cos the trains and busses in the UK are fucking amazing and never been cheaper since privatisation. awesome.
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BB: Saving money is good, we agree. There's buffoonery and waste of shareholders/taxpayers cash in all domains. Seek and ye will find. As to an informed judgment, all you have is the job-title, so I'd be more circumspect about what your research is showing you.
That's by the by - my point is that yoking together a few dubious job titles with a comment about private competition perhaps offering a better service is fallacious.
Show me some real evidence which supports your contention. The internal market of the NHS? The egalitarian education system of the USA? PFI? The academy roll-out?
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What Dave said.
BB have you got a good example of something that's been privatised that is running better?
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So if the public sector is the great gravy train in wages and pensions. How come all you folk with the education and the grades CHOOSE to work in the private sector. :-\
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Although, one could argue that you might get a better level of service if private companies were in direct competition to perform these services.
yeah, cos the trains and busses in the UK are fucking amazing and never been cheaper since privatisation. awesome.
I agree with you Dave, but a keen neoliberal would argue that poor privatisation performance is a result of bad (or badly designed or no) regulation...
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BB I defy you to give me an example of an industry that is now run better since privatisation. As far as I can tell private entities that run post public owned firms are essentially asset strippers who fail to invest in infrastructure and prioritise profit above all else. A prime example would be care homes for the elderly. I can't remember the name of the last one to go to the wall but it seems obvious to me that when a service like care for the elderly is run as a for profit business people, the customers as they are now, are seen as little more than figures in a balance book therefore compromising their care and leading to abuse and neglect.
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Spot on Ben.
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Very true, but its also worth remembering the public sector health care also puts a price on each persons health and the associated treatment/care. Instead of profit its given the fancy acronym QALY (Quality-adjusted Life Years) (http://en.wikipedia.org/wiki/Quality-adjusted_life_year) and it underpins a lot of the recommendations made by National Institute for Health and Clinical Excellence (NICE) (http://www.nice.org.uk/) with regards to treatment and care regimes.
QALY's are also why the new wonder cancer drug that has the potential to extend a patients life for five years, but in most cases will only add another six months on but at the cost of £20000, don't get recommended as useful treatments.
Thats not to say I wish to see the NHS privatised at all, far from it, but they do have limited funds to work with which, just as in the scenario of private care, resulting in a figure being put on people's care, just for a different reason.
Yet again I've gone :off:
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Ah, but privatisation leads to competition and customer choice.
Just like the energy utilities, yeah, I get to choose which one is going to massively rip me off with rubbish customer service for the sake of profit maximisation.
Oh, and also, well - no matter what side of the fence you sit on re: offshore wind vs nuclear - the reason offshore wind is being developed and nuclear is struggling, is mainly because the utilities cannot raise the required capital to fund a nuclear project. Individual wind projects are much smaller, so investors take the risk. If the utilities were still nationalised, we'd be doing what the Koreans are doing:
You, build power station, there, now!
I scan see the NHS being slowly privatised for the sake of "consumer choice and market competition" and all we'll get is massive medical insurance premiums and not much better care.
:off:
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Another good example of privatisation fostering competition: sheffield busses, where this year I seem to remember reading that First and Stagecoach instead of directly completing with each other are going to work as a syndicate, i.e. effectively a price fixing ring. Lucky they've only got 1000year contracts.....
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Should have included this in my post but left it too long and can't edit...
Plenty of evidence (http://scholar.google.co.uk/scholar?hl=en&q=hospitals+financial+incentives&as_sdt=0%2C5&as_ylo=2005&as_vis=1) abounds as to whether financial incentives affect patient health (was a talk here the other day (http://www.york.ac.uk/che/seminars/che/2011/katharina-hauck/)).
Anyway, back to pensions.