Public Sector Pensions

hugheskevi

To give some balance and some facts to the thread:

Future expenditure on benefits to State pensionsers will range from 6-7% of GDP over the next 50 years. Payments from public sector pensions will be 1.5%-2% of GDP over the same period. If the country is broke paying public sector pensions, then God alone knows how the general pension bill will be paid.

Private sector workers may well have access to salary sacrifice pension contribution arrangements, benefitting from NICs relief by over 20% which public sector workers won't have access to. Private sector workers may also have access to Share Incentive Plans which public sector workers won't have access to.

Bonuses in private sector are likely to be larger than public sector. Wages at the mid to upper end of the scale are massively higher in private sector. Public sector wages at the lower end are likely to be higher than the private sector as most of the low wage jobs in the public sector such as cleaning have been contracted out to private sector firms, so the public sector has a different job structure to the private sector. Other forms of remuneration such as company cars, health/dental plans, gym membership, insurance, etc, are also more likely in private sector.

It is naive to talk about pensions without discussing the wider remuneration issues, of which pension contributions are just a part.

StevieJ

hugheskevi wrote: »

To give some balance and some facts to the thread:

Future expenditure on benefits to State pensionsers will range from 6-7% of GDP over the next 50 years. Payments from public sector pensions will be 1.5%-2% of GDP over the same period.

Is that true, you wouldn't believe it listening to some comments on here, I was under the impression it was going to steamroller the economy :eek:

Arcaine

Just got in from a nice morning at the local park playing football with my lad....its a really nice day out there..

I think that if there was a promise made the Government should honour those agreements. No Question! If people just expect the benefits without additional funding then these schemes are going to fall well short of paying everyone, so people will have to pay a little more in to cover the pension they wish to receive.
I am financial controller for a private company and we have a defined benefit scheme deficit we have to manage. It is of course closed now to new entrants and is not accring additional benefits for anyone in it as there is no way the company can afford to have it for everyone, it is simply too expensive. (With the money I hand over the the Pension Protection Fund each year I could hire 2 additional apprentices), and on top is the cash we put into bringing the deficit down. I certainly think new public sector workers should not be made promises that will cost the tax payer/front line services more in the long run as I feel that isn't particularly ethical either. I just feel that there is a two tier pension scheme running now in this country now.

FATBALLZ

That's exactly the problem, it's a two tier scheme, one with unaffordable promises, and the other who have pensions where they take all the risks themselves. If these expensive pensions need bailing out it should be by levying extra tax on the people receiving the pensions, not taking even more from those with inferior pensions.

Spartacus_Mills

marklv wrote: »

This is an idiotic poll because the issue will be the decided by the government of the day, not by a referendum.

That should not stop us from discussing it and a poll to reflect what the forum users think is not a bad discussion point.

Spartacus_Mills

abaxas wrote: »

Of course.

You got tax relief on it!

Which is exactly the rationale for applying tax to pension payments as happens currently, once the personal allowance is taken into account.

lvader

If an employer makes a contract to pay a certain level of pension then it's up to them to make sure the pension fund is adequately funded, I'm not sure why the government should be any different.

harryhound

StevieJ wrote: »

Obviously some dishonourable people on here who believe that employment contracts should be broken, where next the £50k promise on bank accounts or defaulting on our govt debt?

The currency has already been devalued by 25% - just ask a Polish plumber.

There are two sorts of people on this thread:

Public sector workers, who seemed to have a little England, attitude where our off shore island is going to find another money tree growing somewhere.

Private sector workers, who are beginning to realise that things are very tough in a competitive world (where the majority work 6 day weeks for a few dollars a day not an hour).

I would help if each poster could let us know if they are private or public sector and the number of days paid holiday they get.

I'm retired private sector on a pension of less than 1K a month and at retirement I used to get 5 weeks holiday - but my company pension fund is in deficit.

Andy_L

Old_Slaphead wrote: »

Would you suggest that those of us making our own private provision without any taxpayer help be expected to pay too?

Going by abaxas's suggestion it would only be you who'd pay this tax as DB schemes rarely use annuities

Andy_L

hugheskevi wrote: »

Future expenditure on benefits to State pensionsers will range from 6-7% of GDP over the next 50 years. Payments from public sector pensions will be 1.5%-2% of GDP over the same period. If the country is broke paying public sector pensions, then God alone knows how the general pension bill will be paid.

(un)fortunatly (depending on your point of view) the state pension isn't contractual. Thats why they've been able to change the increases from wages to (the lower) RPI and raise the retirement age without being taken to court.

(un)fortunatly (depending on your point of view;)) public sector pensions are contractual so renaging on them will end you up on court for a fairly clear breach of contract case.