How big should my pension pot be ?

Perfect_Choice

I have no issue of government contributions to a money purchase pension scheme for public sector staff being of the same typical percentage as contributed by private sector employers. In fact Government has specified minimum contribution rules to stakeholder pensions for small businesses in the same manner. That is an example of the level playing field I was previously referring to.

However, in moving the investment risk to the employee, there is a consequence that the employer contribution may well be less and employees are required to contribute more, something which has already happened in the private sector already. I’m certainly not proposing this as a positive, in fact it is a negative but something those in the private sector in the main have had to take the pain with final salary schemes being closed.

As regards the continuing existence of final salary pension n schemes, we’ll they are already down to below 10% of all schemes I believe. Businesses and government to be frank, will see this as a method to reduce their future financial commitments rather than a competitive advantage, there is one clear trend I see, hardly a crystal ball guess. Its tough I know and not welcomed by any employee, but financial constraints will force this onto the public sector in my view like it or not.

Letshavesomerealism

This idea of a public/private sector split is an illusion. It is all about cutting costs, screwing workers, smashing unions and maximising profits. Some private sector companies are good and offer excellent final salary schemes like some public sector employers, some are not and never did, others don't want to pay their share and are leaving the final salary schemes. I think you'll see the less organised/unionised workforces being picked off first and the most unionised workers being picked off last. Another reason to join a union. worksmartdotorgdotuk

Changing demographics is the reason trotted out why final salary schemes have to go (for the workforce:mad:, but kept for the management board;)) but in reality this is nonsense.
Increasing longevity is something to be celebrated and is the sure sign of progress and a civilised society.:T
Lets move billions and billions of spending on such things like ID cards and Trident replacement nuclear nonsense into decent pensions to fund this increased longevity.
Private sector employees need to organise and fight back against these cuts to their pensions. If its good enough for the board then its good enough for everyone else.
As for the private sector they should put more of their profits into their final salary schemes instead of running away from their moral responsibilities. In the end, unhappy workers aren't going to be working as hard as they could have been if they have been dumped on:eek:

ninky_2

bendix wrote: »

I'm not sure of your point ninky.

I won't be in the UK to take any state pension I might be eligible for, and while I understand it can be taken if I live overseas, I have absolutely no intention of claiming it.

I've made this point many times. I won't need it because I will have made ample provision privately. If I don't need it, it would be morally bankrupt of me to take it.

so those defending state pensions / public sector pensions are only arguing out of self interest whilst you, who as an expat for many years has made insignificant NI contributions and so would not be eligible for much of a state pension anyway are taking a morally higher stance in opposing them?

marklv

"I have no issue of government contributions to a money purchase pension scheme for public sector staff being of the same typical percentage as contributed by private sector employers. In fact Government has specified minimum contribution rules to stakeholder pensions for small businesses in the same manner. That is an example of the level playing field I was previously referring to."

What do you define as a 'typical percentage'? 5%, maybe 7% at the most? This would mean an effective pay cut of 10-12% for most public sector employees. No way would this ever happen. Forget it. I would argue for an employer contribution no less than 15% of salary, and even that would be tough to sell. What employers contribute is their own business, so why should the public sector go for the lowest common denominator instead of setting an example for all employers? This talk of a 'level playing field' is utter rubbish because there isn't and never has been a level playing field in the world of work, unless you want to use the old Soviet Communist block as an example. In the USSR there was a level playing field because everybody worked in the public sector and therefore salaries and benefits were virtually the same for each type of job.

The truth is that those who don't like the benefits in their existing job are free to leave and seek another job elsewhere. This is the free market. If you like the pension benefits in the public sector then go and work there! Don't come here to sell your sour grapes to all and sundry.

"However, in moving the investment risk to the employee, there is a consequence that the employer contribution may well be less and employees are required to contribute more, something which has already happened in the private sector already. I’m certainly not proposing this as a positive, in fact it is a negative but something those in the private sector in the main have had to take the pain with final salary schemes being closed."

It's not just the private sector that has taken the pain. In the public sector members have had to increase their contributions significantly in recent years, and the retirement age has moved to 65 from 60.

"As regards the continuing existence of final salary pension n schemes, we’ll they are already down to below 10% of all schemes I believe. Businesses and government to be frank, will see this as a method to reduce their future financial commitments rather than a competitive advantage, there is one clear trend I see, hardly a crystal ball guess. Its tough I know and not welcomed by any employee, but financial constraints will force this onto the public sector in my view like it or not. "

As I said before, what employers decide to do with pensions is their own business. The public sector has already made savings with employee pensions and no doubt will make more, but knee jerk reactions don't help. The issue needs to be examined in depth.

bendix

ninky wrote: »

so those defending state pensions / public sector pensions are only arguing out of self interest whilst you, who as an expat for many years has made insignificant NI contributions and so would not be eligible for much of a state pension anyway are taking a morally higher stance in opposing them?

For the record, I have made around 22 years NI contributions (including several years when I contributed from overseas). By the time I retire back overseas, I will have paid 26 or 27, thus making me eligible, I believe, for close to a full state pension. But, as I have said, I have no interest in taking it because I don't need it.

And, also for the record, I have absolutely no problem with people acting from self-interest. What I object to is the hypocrisy of painting it as something completely different.

marklv

"What I object to is the hypocrisy of painting it as something completely different."

And what I object to is hypocrites who go abroad to avoid paying tax and rake in big money who then have the nerve to tell the British taxpayers what they should be doing.

bendix

marklv wrote: »

"What I object to is the hypocrisy of painting it as something completely different."

And what I object to is hypocrites who go abroad to avoid paying tax and rake in big money who then have the nerve to tell the British taxpayers what they should be doing.

Who is avoiding paying tax? Certainly not me. When I work in the UK, I pay tax in the UK. When I work in another country, I pay tax there. If I have investments in other countries, I pay tax where it is due. In those countries where I pay tax, I think I have a right to comment on how that money is spent.

If you know something about my personal financial tax status that you would like to share with the forum to back up that comment, I suggest you reveal it.

StevieJ

marklv wrote: »

I reckon the state pension will soon cease to exist as anything except a safety net for the poor. I believe Cameron is already planning to get rid of it.

Where did you read that ?

marklv

bendix wrote: »

Who is avoiding paying tax? Certainly not me. When I work in the UK, I pay tax in the UK. When I work in another country, I pay tax there. If I have investments in other countries, I pay tax where it is due. In those countries where I pay tax, I think I have a right to comment on how that money is spent.

If you know something about my personal financial tax status that you would like to share with the forum to back up that comment, I suggest you reveal it.

Thanks for clarifying that you pay tax - in any case I was not referring necessarily to you, but anyone who likes to preach without putting into practice what they preach.

marklv

StevieJ wrote: »

Where did you read that ?

Nowhere, just a rumour. But I think it would be native to think that a Tory administration isn't going to make the state pension increasingly less significant.