Public sector pensions nearly over?

marklv

bumpoowee wrote: »

If the private sector discontinued production of the equipment used by the NHS and the Police then there would still be 'mass death, violence and anarchy'. Not to mention that there would be no tax to pay public sector workers wages. No one is saying the public sector is not a necessity, but to suggest the private sector is any less necessary is just ignorance.

You're stretching the point somewhat. :rolleyes: Under what circumstances would the private sector simply shut down? Hardly likely, is it? But the public sector shutting down is a lot more likely.

marklv

bumpoowee wrote: »

So I take it you don't think life expectancy increasing makes pensions more expensive? Why is this?

A reasonable guess at life expectancy of somebody who is now 21 would probably be about 90. So assuming they start work now and retire at 60, they would spend 39 years of their life working. They would then spend 30 years of their life claiming a final salary pension at 2/3. Not to mention that they would spend their first 21 years being a net burden on the state due to not working. What proportion of income do you suppose would need to be set aside in order to support this?

There were 90 year olds in 1970, not just now. OK, we have more of them now, but assuming that everyone will get to that age is pure speculation. The first 21 years a burden on the state? More like a burden on their parents! :rotfl:

bumpoowee

marklv wrote: »

You're stretching the point somewhat. :rolleyes: Under what circumstances would the private sector simply shut down? Hardly likely, is it? But the public sector shutting down is a lot more likely.

You seem to be deviating from the original point somewhat. What I was disputing was that public sector workers exclusively 'keep the country going' as you suggested. I've provided arguments as to why that isn't true. Now you are changing the subject.

bumpoowee

marklv wrote: »

There were 90 year olds in 1970, not just now. OK, we have more of them now, but assuming that everyone will get to that age is pure speculation.

Life Expectancy is an average -sure there were 90 year olds in 1970, and probably in 1870 and 1770 as well. It's just that on average there tend to be more 90 year olds as a proportion of the population as time passes - ie Life Expectancy is increasing.

Your implication seems to be that because we don't know with 100% accuracy what Life Expectancy will be in the future we should just assign arbitrary (and arguably very large) pensions to ourselves and expect our children to pick up the tab when we retire. Is this correct? What do you think will happen if it turns out Life Expectancy continues to increase at the rate it is at present until when you retire in this case?

CLAPTON

Gazpablo wrote: »

You know what, I've read this thread through from start to finish and I would just like to say that I'm sick to death of people slagging off public sector workers, the majority of whom are hard working, decent folk. Everyone deserves a decent pension whatever sector they work in, provided they have paid in for that pension. Try living in a world where there are no rubbish collections, no sewage treatment, no education for children, no care for the elderly. For goodness sake don't be taken in by right wing newspapers, right wing politicians (and their friends the bankers) who stoke up the flames of envy. No good will come of people arguing and fighting each other over pensions envy. Many people who had entered into a contract to secure a decent pension (often 30 or 40 years ago) have a perfectly legal right to have that contract honoured. If contracts are not honoured then we are all well and truly in the mire.

just for the record (and without taking sides on the pension issue)

most rubbish collection has been done by the private sector for years

all sewage treatment in England (not Scotland) is carried out by privatised companies many foreign owned)

most education is indeed provided by the punblic sector but a signifacant amount is provided by the private schools


I don't know the figures for care for the elderly but a lot is provided by the private sector too.

and as far as contracts not being honoured... well what about all those private sector final salary schemes...that have been closed.

marklv

CLAPTON wrote: »

just for the record (and without taking sides on the pension issue)

most rubbish collection has been done by the private sector for years

all sewage treatment in England (not Scotland) is carried out by privatised companies many foreign owned)

most education is indeed provided by the punblic sector but a signifacant amount is provided by the private schools


I don't know the figures for care for the elderly but a lot is provided by the private sector too.

and as far as contracts not being honoured... well what about all those private sector final salary schemes...that have been closed.

I appreciate that the private sector also does a lot of important work, but I resent the finger-pointing towards the public sector as if it was the cause of the issues affecting the private sector. I also object to final salary pensions closing in the private sector (of course), but it is worth pointing out that many private sector employers still offer them. At the end of the day you should direct your frustration at the government, for not having taken steps to prevent all this from happening.

bigheadxx

DVardysShadow wrote: »

I think if you want heads out of the sand, the question you should be asking is not "Why should only public sector workers get this?" it should be "Why are the rest of us not getting Final Salary Pensions?".

At the moment, it looks like you are cheerleading for the bankers. When you poke Public Sector Workers in the eye for having final salary pensions, you are poking everyone in the eye who realises the value of a pension and would like the opportunity which most people had a few years ago.

A few years ago (maybe 20 or thirty) generous pensions, both public and private were sustainable because there were more people in work and paying taxes than people claiming a pension. Now and into the future this is not the case and the private sector is acutely aware of this because it has to make money. The public sector, which has a budget to spend and does not have to make a profit, needs to get real on this issue.

Most of what the public sector does (except policing, defence, national security) is already done very well in the private sector. The problem with most outsourcing is the way it is done by incompetent politicians who do not understand how to run a business.

marklv

bigheadxx wrote: »

A few years ago (maybe 20 or thirty) generous pensions, both public and private were sustainable because there were more people in work and paying taxes than people claiming a pension. Now and into the future this is not the case and the private sector is acutely aware of this because it has to make money. The public sector, which has a budget to spend and does not have to make a profit, needs to get real on this issue.

But the public sector is already getting 'real' on this issue. Retirement ages, which had always been 60 in the public sector, have now largely been moved to 65, and employees have been asked to contribute more. Also, in many cases, final salary pensions have been replaced by career average salary pensions. Not to mention deducting the lower earnings limit from pensionable pay, index linking pension payments only to 5% a year maximum, etc. Many cost cutting measures are already in place and more will follow. What is all the fuss about?

bigheadxx wrote: »

Most of what the public sector does (except policing, defence, national security) is already done very well in the private sector. The problem with most outsourcing is the way it is done by incompetent politicians who do not understand how to run a business.

No it isn't! Give me some examples if you believe this. The public sector is not a business and should not be run like one; it is there to provide a service to the public. Once you start to inject business thinking and profit motivation then you deteriorate the service and things go wrong from there. This obsession with outsourcing might save the government some money, but it usually results in poor performance and insufficient staff to do the job properly. And in a lot of cases it doesn't even save the government any money; look at all these big IT projects that have cost billions and are stilll nowhere near finished.

Ygor

The vast majority of the private sector have no occupational pension scheme. While more 'affordable' for the employer, I don't think this is the way to go.

I'd be very happy to see final salary schemes return to the private sector. There's more risk, but that runs both ways as in the 80s and 90s, large returns meant contribution holidays for DB schemes.

bumpoowee

Ygor wrote: »

The vast majority of the private sector have no occupational pension scheme. While more 'affordable' for the employer, I don't think this is the way to go.

I'd be very happy to see final salary schemes return to the private sector. There's more risk, but that runs both ways as in the 80s and 90s, large returns meant contribution holidays for DB schemes.

As much as I would love a final salary scheme, I just don't think they are sustainable. You can't realistically expect to pay somebody 2/3 or whatever of their FINAL salary (which is probably above the average salary for somebody in the company) for 20, 30 years plus after they retire without taking 50%+ of their wage while they are working to pay for it.

People aren't going to accept a 50%+ pay cut neither are employers going to stump up this cash, as they will just look elsewhere (think non-UK) if anybody tries to force it on them.

I don't know exactly what the best way for pensions to work should be, however some sort of national scheme or legally mandated employer provision in between what most of the private sector have and what the public sector have would be something to aim for, perhaps a DCS where the employer or government puts in up to 10% of matched contributions and maybe 5% contribution even if the employee puts in nothing. I know the government are proposing something like this already but it doesn't go far enough or address the unsustainability of existing government DB schemes.