RPI to CPI Early Day Motion 1032

viridens

kidmugsy wrote: »

@cvd, of course they're lying about the motivation. What do you think would happen if the Chancellor went about arguing in public that "the state is broke"? But broke it is.

More musings

The Government has been borrowing off its own employees by promising them proper pensions in the future in return for contributions made in the past. Instead of making proper prudent investment or provision, Government experts chose to work hand-to-mouth and simply rely on contributions from current workers to pay for current pensions.

According to Office for Budget Responsibility, This current PS pensions 'shortfall' this year is roughly £7 bn. Here are a few other rough figures:

Annual Overseas aid (in the news currently), also £7 bn
Recent 'loan' to Ireland, also £7 bn
Iraq & Afghan war £4 bn this year (in addition to £35 bn annual defense budget)
Public sector funding for Olympics £9 bn
etc etc.
And before you tell me how all those benefit society & the overall economy, so do I when I blow my pension on baked beans etc at tesco.

Old_Slaphead

viridens wrote: »

More musings
The Government has been borrowing off its own employees by promising them proper pensions in the future in return for contributions made in the past. Instead of making proper prudent investment or provision, Government experts chose to work hand-to-mouth and simply rely on contributions from current workers to pay for current pensions.

You're oversimplifying things.
You also need to add the notional employers contribution of around circa 15% of the sector payroll of £150bn (ie around £23bn) to that amount by which the taxpayer is funding current pension payouts. It is not solely being paid for by employee contributions.

viridens

Yes, I am guilty of oversimplifying, but the principle remains exactly the same.

It is also true that the 'shortfall' has nothing to do with the financial crisis, but is the result of successive Government financial experts and actuaries getting their sums and projections wrong.
Does this shortfall justify retrospective alteration of written scheme rules as an easy fix? If so, perhaps this model could be adopted by folks finding it hard to meet financial obligations of all kinds...

Ripoff_2

The EDM 1032 is still alive and kicking, so far 119 MP's have now signed

LAB = 96 LD = 4 CON = 0 Oth = 19

The RSS letter I posted the other day really does go to show that this change is WRONG and should be put right immediately.

You can have as many arguments as you like about whether the country can or can not afford the promises made but what you can't argue against, is that the change is not doing what the Pensions Minister emphatically said the change was for. That is "It's a better measure of pensioner inflation". It is quite clear that that is not the case and the RSS has, with out any doubt, reiterated that CPI is NOT a sufficiently good measure of price inflation for pension indexing.

One does have to question, if the country is so broke, how can we possibly afford the HS2 line, or increased funding for Overseas Aid. Surely, both of these BIG expenditures need stopping forthwith. One has also to remember that the change from RPI to CPI is not until the deficit is paid, which by the way will only be paid off mainly with growth, it is a change that is permanent, therefore it is for life. This change can not be fair by any shadow of doubt unless you actually believe that this change is a better measure of pensioner inflation, which the professionals do not believe.

One further point, in 1946 after the war the country had a structural deficit of 250% of GDP, during that period we built the NHS, built houses and infrastructure, and far more besides, plus we went for massive growth. Today the structural deficit is 57.6% of GDP but today we are joining Ireland in a slash and burn policy that if Ireland is anything to go by will end in tears. Without growth, all this pain will be for nothing, we will still have a structural deficit after 4 years of this Coalition and who will the coalition blame then I wonder?

Even the BOE Governor came out the other day and said that bailing out the banks caused the deficit, but I DON’T SEE THEM BAILING THE COUNTRY OUT. With there £5m bonuses and offshore tax avoidance measures. This Government appears to have left them alone now and decided it is far easier to make the pensioners pay than the banks and using the RPI to CPI change will do the trick.

Old_Slaphead

viridens wrote: »

It is also true that the 'shortfall' has nothing to do with the financial crisis, but is the result of successive Government financial experts and actuaries getting their sums and projections wrong.

I certainly agree with you - but that's been apparent to most for at least 10 years.

Pity that the Labour Goverment (aka the Trade Union Party) didn't have the balls to do anything about it other than keep the Ponzi scheme going by ever increasing public sector employment and 'theft' from private pensioners.

viridens

Old_Slaphead wrote: »

I certainly agree with you - but that's been apparent to most for at least 10 years.

Pity that the Labour Goverment (aka the Trade Union Party) didn't have the balls to do anything about it other than keep the Ponzi scheme going by ever increasing public sector employment and 'theft' from private pensioners.

Assuming for the moment that your hypothesis is correct, how does this justify this further attempt of theft from pensioners, who are merely asking Government to honour its side of the scheme it both devised and administered?
More of a cowardly act against an assumed soft target than "balls".

Old_Slaphead

viridens wrote: »

Assuming for the moment that your hypothesis is correct, how does this justify this further attempt of theft from pensioners, who are merely asking Government to honour its side of the scheme it both devised and administered?
More of a cowardly act against an assumed soft target than "balls".

Well I certainly don't think it fair to blame the current government who've inherited a £1trillion+ pension black hole at a time when the economy's unlikely to grow at previous rates. (nb the public pension deficit is greater than the national debt).

Someone's got to pay....

Taxpayers ? - well they have and will continue to contribute plenty. About 80% of the cost actually. Is it fair to expect them to pay more towards the virtually unlimited potential liability if they are denied such benefits themselves.

Current scheme members ? - They will have to pay more for less benefit. Fair enought because they are taking far more out than they are paying in and the reason for the continuance of this lavish scheme (ie that public workers are paid less) is no longer valid.

Existing pensioners ? - As they are the ones who have benefited most from Government largess it's not unreasonable to expect this group to contribute. Even Blair said his greatest regret was not reforming the public sector (& ergo public sector pensions).

So, in effect, we ALL pay. We've all been screwed on pensions - even with the decrease due to change of index, I reckon that RPI/CPI pensioners will have 'got off' more lighty than most. We've all been promised things that have not materialised. We've all suffered from inept management and a government that changes the rules.

IMO it was the Labour Government who, by adding significantly to the public payroll (for ideological reasons?) have exacerbated this 'crisis' and consequently it is they rather than the current lot (who I don't support either!) who should be the subject of your opprobrium.

Goldwing1

Here's a report on Tuesday's activities;
http://www.thisismoney.co.uk/pensions/article.html?in_article_id=524138&in_page_id=6&ito=1723

I didn't think to take details of who spoke (MP's and union people) and who the MP is who will table the EDM. Can anyone fill in the gaps? Clearly the unions are starting to organise themselves.

While there is a lot going on "behind the scenes" so to speak, the message to us is clear, keep lobbying those MP's.

If you didn't manage to lobby yours on the day, all is not lost. Continue to write to your MP, make use of their surgeries and, don't forget to remind them that we are voters!

Haybob

An interesting article can be found in this month's CSMA magazine on page 101.

RETIRING WITH DEBTS

More than one in five people will retire with debts this year, according to new research from Prudential. The average amount owed when people stop working is £33,100, but one in 20 will retire with outstanding debts of more than £50,000, rising to one in 10 among men over the age of 65. The Class of 2011 study also shows a further 14% don't know whether or not they will be debt free when they retire.

The major sources of debt in retirement are credit card and mortgages - 55% of those retiring in 2011 owe money on credit cards, while 52% have outstanding mortgage balances.

This study seems to contradict any justification for a move to CPI as being more appropriate for pensions.

Ripoff_2

Haybob wrote: »

An interesting article can be found in this month's CSMA magazine on page 101.

RETIRING WITH DEBTS

More than one in five people will retire with debts this year, according to new research from Prudential. The average amount owed when people stop working is £33,100, but one in 20 will retire with outstanding debts of more than £50,000, rising to one in 10 among men over the age of 65. The Class of 2011 study also shows a further 14% don't know whether or not they will be debt free when they retire.

The major sources of debt in retirement are credit card and mortgages - 55% of those retiring in 2011 owe money on credit cards, while 52% have outstanding mortgage balances.

This study seems to contradict any justification for a move to CPI as being more appropriate for pensions.

Funny that because Steve Webb insists that only 7% of pensioners have a mortgage, just goes to show how much he really knows.

The Government are being told LOUD and CLEAR that they have got the RPI to CPI change wrong, not only by the pensioners and future pensioners but also the professionals.

They say they are a listening Governmnet but they don't seem to be listening to me???????

Perhaps we need to SHOUT LOUDER!!

You may find this useful for public sector pensions, it also gives the average pension per section, it's very interesting. They are NOT as good as people think they are especially the LGA's. http://www.bbc.co.uk/news/business-10912958