MSE News: Public sector pension benefits should be cut – report

mindymoo1

Let's not forget it's a recommendation. I hope, like other comments that current pension schemes will be honoured and new starters then start on the new scheme- much like what happened in 2008 with the new NHS pension scheme. To add to that the NHS is allowing people on the 'old' scheme to change to the new scheme...because it may benefit some people (however I'm sceptical) but it appears that they have spent a considerable amount of time and money to inform NHS employees of what these choices mean.

I'm afraid that as a public sector worker there are many people who think when we retire we're rolling in it, lol. Unfortunately I think regardless of work background (private or public sector) that money is going to get tighter and tighter apart from the privalidged few at the top. I listened to one radio broadcast which was like a witch hunt for public sector workers.

Whilst it may be okay for many public sector workers to be promoted or move side ways in their careers to a less physically demanding job there are only so many of those jobs available. And those jobs are less secure; the police increased the amount of patrols and there are only so many university lecturers/ nurse educators posts available to nurses. Like the psychiatric A/E nurse will I be expected to scoot around my patient, care all I can for them, make them comfortable whilst doing the heavy moving of various equipment etc in the critical care setting whilst trying to manouvre my mobility scooter....of course not because that would be ridiculous but what job would I do?!! How about the guys and girls coming back from war? The government want ways of saving money and one of them is reducing jobs in the public sector whilst holding talks with Tescos etc. to encourage job growth. It all seems backwards. I'm not sure how other public sector workers have been hit but nurses have had incremental pay stopped. George Osbourne even hinted at the Conservative conference in Birmingham last year that maybe NHS workers could work a shift a month for free. Because NHS workers don't already work after their shift ends for free already eh?!

Maybe, unfortunately we're heading for the end of the state pension (probably why it's now compulsory for every work place to offer a pension), increasing retirement ages except for the few who can afford it and potentially even people dying before or just after retirement.... I'm currently 31, maybe retirement age will have kept increasing and I'll have to be 85 before I can collect... but then I'll have some form of dementia and I'll have forgotten I've got anything put away.

jamesd

The coming change to workplaces having to offer and opt people in to a pension is a result of the final report of the Pensions Commission, as is the increased state pension age, elimination of contracting out and gradual changing of S2P to provide flat rate instead of earnings-related benefits. Their three reports are interesting background reading to the proposals and reasoning of the Hutton report.

If you're interested in a practical suggestion to help you retire earlier or with money, you could stop throwing money away by overpaying on a mortgage. That makes you poorer long term than investing because typical investments pay about twice the rate of mortgages at normal interest rates of around 5% for a mortgage. A more productive thing to do is invest the money via a stocks and shares ISA and then repay the mortgage at the end date you'd have had if you'd been overpaying at the same rate. That ill typically leave you a substantial surplus, though it's not guaranteed. Mortgage overpaying is only for those who aren't willing to take investment risk or just want the mortgage gone.

At 31 you've plenty of time to invest to be able to retire earlier than state pension age if you want to commit the money to do it. It's a choice for you to make. Just not something to grumble about later if you don't make that choice and act on it.

DuffMeister_2

You think you pay a lot, but it is still only around a quarter of the total cost. Your employer (i.e. us) has to cover a cost about three times as large. And, because you pay a lot, that's even more![/QUOTE]

We pay 11% and the government pays 24.2%. That is a contract I signed up to 23 years ago and I have upheld my end of the agreement since. Why all of a sudden can that agreement be broken? If I had known at the outset they were going to do this, I would have opted out of the scheme, spent the money on things my family needed and then sponged off the state like everyone else when I retired.

Instead I chose to be responsible and opted to save for my future. After all that is what we are encouraged to do. So why is it that I feel that I have "MUG" tattooed on my forehead now?

ds9074

DuffMeister wrote: »

You think you pay a lot, but it is still only around a quarter of the total cost. Your employer (i.e. us) has to cover a cost about three times as large. And, because you pay a lot, that's even more!

We pay 11% and the government pays 24.2%. That is a contract I signed up to 23 years ago and I have upheld my end of the agreement since. Why all of a sudden can that agreement be broken? If I had known at the outset they were going to do this, I would have opted out of the scheme, spent the money on things my family needed and then sponged off the state like everyone else when I retired.

Instead I chose to be responsible and opted to save for my future. After all that is what we are encouraged to do. So why is it that I feel that I have "MUG" tattooed on my forehead now?

Under Hutton's proposals you will not lose any of the benefits you have built up these past 23 years. They will still be there as if the scheme had continued unchanged. So it has been well worth while you contributing all this time.

The change is going forward you will accure benefits in a different way between 2014/2015 (or whenever the new scheme comes in) and when you retire.

Given 23 years under the existing schemes and given that the new schemes are still likely to be more generous than almost any private sector scheme you will still likely end up with a good pension.

DuffMeister_2

markeymark wrote: »

prison officers included, the forgotten service,the police just deal with the scum for a cpl hours, we have them for years!!

Markeymark, you seem to have forgotten that most criminals nowadays are in for very short periods of time and if Ken Clarke has hs way there will be fewer in and those who do receive a custodial sentences will be there for a matter of weeks. We deal with the same people time and again and no sooner do we lock them up than they are out again committing the same old crimes.

They are granted days out in the community, serve half of the sentence given and get released even earlier if they are out on tag; which a considerable number of them breach.

Only this week my colleagues located a suspect wanted on warrant for previous offences, placed that suspect before the court who immediately bailed them. They then went to the local Boots store and shoplifted a load of goods. Had that person been locked up by the court, that offence would not have occurred. If the public knew the half of what went on, they would be up in arms.

If this government really wants to save some money, I suggest they lock them up for longer. If they are inside, they can't commit crime. Moreover, for those of them that can afford it, why don't we charge them the real cost of the prosecution? I'm sick of hearing prosecutors asking for costs of £45 at court when we all know the real cost is anything from hundreds of pounds to tens of thousands!

DuffMeister_2

ds9074 wrote: »

Under Hutton's proposals you will not lose any of the benefits you have built up these past 23 years. They will still be there as if the scheme had continued unchanged. So it has been well worth while you contributing all this time.

The change is going forward you will accure benefits in a different way between 2014/2015 (or whenever the new scheme comes in) and when you retire.

Given 23 years under the existing schemes and given that the new schemes are still likely to be more generous than almost any private sector scheme you will still likely end up with a good pension.

You are missing the point somewhat. I entered into a contract in which both sides agreed the terms. My pension accrues at one sixtieth per year for the first twenty years and at two sixtieths per year for the next ten years. I therefore am currently only entitled to less than a half pension. My remaining seven years should make that up to a two thirds pension. It appears that I am no longer going to be able to achieve this. My mortgage is dependent upon it. I thought I was being responsible in planning my future but it is clear that I have just been ripped off.

Are you telling me that if you agreed a contract with a mobile phone company and they suddenly increased your monthly payments and reduced your minutes and texts, you would be grateful? Somehow, I think you would find yourself another mobile phone company.

Don't forget that the police pension scheme was changed in 2006 so it has already undergone a review, so there will be savings there in the future. Why the need to target those on the old system now?

They are in danger of making this so unattractive to new officers, that many of them will opt out of it (Many currently opt out of the 2006 scheme). If they do opt out, where then will the money come from to pay for the existing pensions?

No other public sector worker pays more in pension contributions. The fire service also pay 11% and in contrast most others pay in the region of 5-7.5% with the armed services not contributing at all. I have nothing but admiration for our armed forces (I used to be in the army) but how can we justify zero contributions when others are being asked to increase their subscriptions to 14%? Highly paid judges by the way pay 1-2.5%.

ds9074

DuffMeister wrote: »

You are missing the point somewhat. I entered into a contract in which both sides agreed the terms. My pension accrues at one sixtieth per year for the first twenty years and at two sixtieths per year for the nect ten years. I therefore am currently only entitled to less than a half pension. My remaining seven years should make that up to a two thirds pension. It appears that I am no longer going to be able to achieve this. My mortgage is dependent upon it. I thought I was being responsible in planning my future but it is clar that I have just been ripped off.

Are you telling me that if you agreed a contract with a mobile phone company and they suddenly increased you monthly payments and reduced your minutes and texts, you would be grateful? Somehow, I think you be find yourself another mobile phone company.

Don't forget that the police pension scheme was changed in 2006 so it has already undergone a review, so there will be savings there in the future. Why the need to target those on the old system now?

They are in danger of making this so unattractive to new officers, that many of them will opt out of it (Many currently opt out of the 2006 scheme). If they do opt out, where then will the money come from to pay for the existing pensions?

I doubt you have been ripped off, you have probably got a very good value deal, from the contributions you have made against the benefits you will still get, even if it is not quite as good as you originally hoped.

I would still argue that an employer has to be able to alter employment terms going forward to take account of changes in circumstances. If the employee does not like the new terms and thinks they can do better elsewhere they are free to resign. Only contributions already made should be protected.

As for the reforms of public sector pensions that seem to have happened in Labour's later years - I do not think they went nearly far enough to prevent these schemes relying heavily on subsidy from the taxpayer, beyond the planned 'employer contribution', to keep them solvent in the years ahead.

DuffMeister_2

ds9074 wrote: »

I doubt you have been ripped off, you have probably got a very good value deal, from the contributions you have made against the benefits you will still get, even if it is not quite as good as you originally hoped.

I would still argue that an employer has to be able to alter employment terms going forward to take account of changes in circumstances. If the employee does not like the new terms and thinks they can do better elsewhere they are free to resign. Only contributions already made should be protected.

As for the reforms of public sector pensions that seem to have happened in Labour's later years - I do not think they went nearly far enough to prevent these schemes relying heavily on subsidy from the taxpayer, beyond the planned 'employer contribution', to keep them solvent in the years ahead.

So when I am unable to pay off my mortgage, become homeless and have to survive in public authority housing, living off benefits, are the tax payers going to be any better off?

DuffMeister_2

Don't forget that it is not just my pension they are after. They want to take approx' £2000 off my salary and that is before the rise in NI contributions, the pay freeze which equates to approx' 8-10% over two years (Inflation) and an attack on my conditions of service.

Dare I point out, I am forbidden by law to strike!

Stargazer57

DuffMeister wrote: »

You think you pay a lot, but it is still only around a quarter of the total cost. Your employer (i.e. us) has to cover a cost about three times as large. And, because you pay a lot, that's even more!

We pay 11% and the government pays 24.2%.

35% is only enough to play for police pensions in the fantasy world (perpetuated by the Labour governement when it was in office) where you can earn 3.5% interest, in excess of RPI inflation, on a government guaranteed investment. As the true rate is below 1%, the true value of police pensions is around 50% of salary of which the member pays 11%.

DuffMeister wrote: »

So why is it that I feel that I have "MUG" tattooed on my forehead now?

Your reaction to a modest cut in future accrual is to say you wish you had never joined the scheme. But in recent years, while private sector pension provision has been collapsing, you have been enjoying an implied employers contribution of approximately DOUBLE the already generous amount you thought you were getting.

MUG doesn't really do justice to such idiocy.