Public Sector Pensions - Are they really so bad?

grizzly1911

Loughton_Monkey wrote: »

I forged a good career from operational efficiency, systems/IT, and getting true hard work and customer focus - in every case with (on average) about a 40% reduction in headcount.

Yep me too, probably chopped the headcount, don't always believe it generated the savings expected or greatly improved the quality.

Loughton_Monkey wrote: »

Number 1 culprit is [STRIKE]always[/STRIKE] often the poor systems and procedures.
Number 2 culprit is lack of 'empowerment' with training [people tending either to make stupid decisions if allowed, or becoming a 'jobsworth' if not. AGREE TOTALLY
Number 3 culprit is motivation of staff - which should largely be given by trained managers who are seen to work as hard as the front-line staff. AGREE IT IS A BIG PART BUT NOT THE WHOLE

The sort of person you outline is fairly rare, and to be applauded. She, and people like her, probably cost us about 0.1% of the entire taxation budget.

I have to disagree with you on that one - in my experience they are quite common in the clinical side of the NHS, using your example, in particular. I have known several people personally in the NHS and also professionally from consultants down to nurse level over many years

There are a great many who enter roles because they are passionate for peoples well being medical clinicians, education, and emergency services for example.

Loughton_Monkey wrote: »

A recent experience with a health issue involved a minor operation as a 'day patient'. But the complete and utter nonsense I saw

The trouble is they handle thousands of cases a day. Many of those are routine and yes I agree that the repetition and form filling is a pain -why because they are crawling all over themselves in case of medical negligence claims. The health care trust that I have received care in recently, both urgent cases, have been first rate. In one case the hospital doctor immediately phoned up the best regional hospital who saw me without a prearranged appointment within 4 hours, 90mins travel time and then undertook the procedure within 36 hours.

When I have attended outpatients or clinics they have double checked my details to make sure they are treating the right patient, right organ, and medication just in case they give me contradictory treatment. Personally I would prefer it if they did. All my labels were pre printed on stickies and they simply attached them to the necessary forms.

I have been seen on time on all but one occasion, which was out of hours.

Perhaps I have just been lucky or maybe it is a lottery with the trust.

Loughton_Monkey wrote: »

Let's understand the the public sector is a complete shambles. In the middle is certainly a handful of people doing as best they can under the circumstances.

But the real cost (including pensions) is 'round the back' or 'up at Regional....' or 'in the Trust....' who quite frankly don't deserve jobs, let alone pensions!

I think to say it is a complete and utter shambles is incorrect. There are a lot of things done well thousands of times.

They have meaningless targets imposed that aren't SMART to satisfy Whitehall dictats because of political promises. They often work to "achieve" those targets which don't necessarily improve matters as they do not have a choice.

Because of the number of things they do they also make a lot of errors. They are not very good at sorting those errors out. You have alluded to the fact that they operate to rigid, inflexible processes that don't flex for the exception. The staff often have very little discretion to act as you point out.


That is no different to many big private sector operations though, Banks, Utilities, I have even had run ins with John Lewis (they did apologise profusely and sort it out but only after I routed out someone who could act). In many ways big corporates mirror Government but slimmer, certainly the politics and "Kings Clothes" exist.

There are many wasteful areas and I agree with your comments around salaries and pensions being wasted on unnecessary levels of chiefs.

I think there are lots of jars of honey but as you say for too many buckets of treacle.

quantic

To my understanding, public sector workers:

- Pay less contributions towards pension (Both in terms of % monthly and period contributed)
- Receive more back relative to contributions
- Have much better holiday packages
- Retire at a much younger age
- Are often unsackable/unaccountable (at least in the way private sector workers are)
- Receive much more generous redundancy packages
- Less than 1% of public sector workers earn 15k or less.

I do not resent them for having these perks, the private sector has its own. But do they really expect everyone else who actually foots the bill to allow this to continue while many many private companies do not ever see cost of living increases and are on their knee's, its almost as if all public sector jobs are above the rest of us. I say they make teachers work 6 week holidays and half terms. I am still amazed when talking to public sector workers, that they do not understand that the public sector only consumes money rather than creating it (But the trickle down... we spend money on marketing etc which feeds other businesses and helps the economy - we wouldnt bloody need supporting if the over inflated public sector wasn't strangling us.)

I think its about time that the public sector got in touch with reality.

flimsier

abaxas wrote: »

Being almost unsackable and no reason to work hard, are two more obvious benifits.

Untrue and stupid. (I'm working my way through this thread; expect some angry posts).
Saying that people in the public sector are "almost unsackable" at this time is a pretty sick joke.

flimsier

wotsthat wrote: »

I don't think your average public sector employee is weighing up the value of the pension scheme when deciding to work in the public sector. Want to be a midwife in the UK - who do you work for? A policeman, soldier etc. The public sector also employ low skilled workers who go into the public sector just because there's a job there - not because of the attractive pension.

Successive governments have run rings round the ineffective public sector unions and offered promises of money in the future vs. money today. Accepting government promises instead of cash is a high risk strategy especially when the politicians making the promises are likely to be dead at the time you call the promise in.

I don't really understand your second paragraph, apart from it seems to being saying that attacks on the public sector have been successful despite (and maybe because of) the unions.

However, I went into teaching partly because of the secure pension. It's a job for life. And I'm angry.

flimsier

Oh, the thread was full of !!!!, apart from about 5 contributions. People should consider research before posting.

I'd like to say:

I joined the profession promised a lifetime 1/80th final salary pension. Why is it ok to change my T&C of employment 13 years in?
I'm in education - along with the announcement yesterday that 1/3rd of schools will now be considered failing, how do you expect to get good teachers in there, when you're basically saying "take your skills to the private sector"
I didn't create the financial crisis. Why am I paying for it?
I don't get the reported average 30something % pay rise that "city bankers" are getting. I believe they are a part of the problem (I'm not!) so they aren't paying for it (though it was interesting to hear the news saying that this was a "slow down" in bonuses and pay rises, and hence they are being "hit hard"). Anyone defend that?
Do you need more?

I am a Deputy Headteacher. I work over 70 hours a week. On weekdays, I am lucky to see my daughter, and usually it's when I wake her up by having a shower (at about 6am). Everyone I know I went to uni with all those years ago (including the owner of this site) earns more than me in the private sector. No exceptions. And now you're saying I don't deserve my pension because it's better than theirs?

(to be clear, I know I'm privileged - partly because I went to LSE, so this isn't actually a hard luck story - I earn enough to sort myself out - it's the comparison between private and public that is starkly illustrated by my experiences with my friends - I went into the public sector out of choice - I'd have earned far far more in the City).

jamesd

flimsier wrote: »

I joined the profession promised a lifetime 1/80th final salary pension. Why is it ok to change my T&C of employment 13 years in?

I doubt that anyone was told that their work terms would remain unchanged for the next forty years.

Changing accrued benefits that have already been earned and changing future benefits that have not yet been earned are different things but there's a complexity due to the use of salary-related pensions instead of money purchase pensions. Salary-related types mean that you have to plan and hope for a subsequent salary increase to maximise benefit, while money purchase just accrue benefits as they are earned. The system would be a lot neater if everyone was on money purchase pensions, which the private sector has largely completed migrating to except for those with older contracts.

flimsier wrote: »

I didn't create the financial crisis. Why am I paying for it?

None of us created the financial crisis. That was done with US laws that allow people to walk away with no debt after having their home repossessed, lenders who can lend on a mortgage then sell 100% of their interest so they don't lose money by making bad loans, flaws in the credit rating of aggregations of those loans and an extended period of low interest rates combined with public money backing loans to those on low incomes. These factors combined to create a system where a drop in house prises could cause a cascading failure of the system.

In the non-US part of the world the cause was the subsequent drying up of the lending markets between banks that destroyed the business models of some banks, notably Northern Rock in the UK. Northern Rock borrowed short term on the markets to fund long term lending on mortgages and when the short term markets dried up it was unable to keep to its commitments to repay loans because it was unable to get new loans to replace them.

flimsier wrote: »

Why am I paying for it?

We're all paying for it in some way but the pension changes are more about life expectancy than the financial system. You're just catching up with some of the changes that have already happened in the private sector.

flimsier wrote: »

I am a Deputy Headteacher.

That makes you one of the big winners of the final salary related pension system, someone who gets a pension related on relatively high ending salary. It's unclear whether a system that provides such distorted rewards to a relatively small percentage of the workforce is a good pension system design if the idea is to incentivise all workers. Good for you, though.

Soubrette

When I started work it was for a big bank, I joined the non contributory pension scheme as soon as I could aged 19 in 1987, I was there for a further 3 years. I then became a codirector of a limited company and put £50per month for the next 12 years into an executive pension plan, I then joined the NHS scheme which at the moment is based on 1/60ths of salary depending on length of service, I've been 5 years in that one in total (left and then joined again after 2 years). All my jobs have been either low paid or part time.

The best pension that I'm due to get is from the bank by a long stretch. Private pensions used to be excellent, then various legislation, allowing companies to access their pension funds and misselling scandals degraded them. The public sector pensions only look good because of the hatchet job done on private pensions since the 80s.

On a different point I think MPs pensions should be classed as public sector pensions and whatever they do to ours, happens automatically to theirs.

ViolaLass

I've just put the contribution figures for teachers' pension into the Hargreaves Lansdown pension calculator to try to see what they would get if that money were invested in a 'normal' work pension scheme. With a starting salary of £21k, employee contributions of 6.4% and employer contributions of 14.1%, I end up with about £17200 a year (I'm 27, assuming retirement at 68).

In comparison, the calculation done for teachers would be something like:

41/60 x (half final salary)

Let's assume I become an AST (Advanced skills teacher) and reach £50k (I don't know whether this is a realistic figure, in today's money, for me to reach and I'm happy to be corrected).

Anyway, that salary would then give me a pension of 41/60 x 25 = £17k, which seems pretty comparable to me. Am I missing anything other than the possibility that a teacher working that long might reach a higher salary?

Edit to add that all figures given here are in today's money.

Cleaver

Loughton_Monkey wrote: »

I am with you all the way on the 'thrust' of this, but I remain an avid 'public sector basher'. I forged a good career from operational efficiency, systems/IT, and getting true hard work and customer focus - in every case with (on average) about a 40% reduction in headcount.

Number 1 culprit is always the poor systems and procedures.
Number 2 culprit is lack of 'empowerment' with training [people tending either to make stupid decisions if allowed, or becoming a 'jobsworth' if not.
Number 3 culprit is motivation of staff - which should largely be given by trained managers who are seen to work as hard as the front-line staff.

<snip>

Look, before I post this please don't think that I'm arguing that the public sector is as efficient and productive as the private sector as it clearly isn't and probably never will be for a myriad of reasons.

But your post tends to follow the traditional cliched MSE forum public sector rant, which tends to be structured as followed:

• Say the the public sector is pretty much awful in most ways.
• Say that the private sector is the beacon of productivity, efficiency and all that is good.
• Pick out a quick example from the private sector showing efficiency.
• Pick out a long example of the public sector being awful.

I would say that the private sector operates in a more effective manner than the public sector. I just don't think that this massive gulf between the two sectors actually exists. I'm perhaps slightly unusual in that I started my career in the publis sector in management, moved to a private sector company for four years and then back in to the public sector where I work now. The private sector company I worked for are in the top 50 biggest American companies and have numerous offices in the UK. I'm not going to name them, but if I did you would have a vision of the typical fast-paced, efficient, productive private sector organisation. We made 'stuff' and also provided consultancy services.

So, was this private sector company 'better' than the public sector organisation I came from? On balance, probably yes. It was more streamlined, we operated more effectively on less staff and I think productivity was higher. But was this massively noticable? No. Was the gap between the two huge? No.

In the private sector company I saw a lot of the same stuff that bugged me in the public sector. There were people who'd been there for years who shouldn't have been but no one wanted to deal with getting rid of them. I had pointless meeting and after meeting which were completely uneccessary and I think everyone in them secretly knew this. I had both people in my team and people who I worked for who I would have happily waved goodbye to and had them replaced with my old colleagues from the public sector who were better than them in many ways. Of course, this works both ways and there were people who were much better than some people I had worked with in my old public sector organisation. There was waste in pretty much every area I saw and plenty of opportunities to make things better and save costs that were never taken, presumably for similar reasons as in the public sector.

Don't get me wrong as I repeat again that the private sector organisation was 'better' than the public sector organisation in many respects. But I was expecting to go there and struggle in a much more fast-paced and productive environment (especially as the organisation was American) but I just didn't see this massive gulf between the two, and I found that surprising. The three culprits that you list in your post all applied to the private sector company I worked for.

I'm back in the public sector now but a huge part of my job includes working with private sector companies and I find the same thing. By and large they are 'better', but there's still the same sh*tty people and the same sh*tty processes that you get in the public sector.

Anyway, my initial post was around abaxas's assertion that people in the public sector have no motivation to work. I was originally pointing out that the view that public sector staff have no reason to work hard is clearly unfounded, especially in compairson to the private sector. The NHS, for example, is made up of around 70% clinicians. Are we really saying that that these people have 'no reason to work hard'? I think that's rubbish, as nearly all of these people have a very clear reason to work hard: caring for the patient in front of them.

tartanterra

flimsier wrote: »

Oh, the thread was full of !!!!, apart from about 5 contributions. People should consider research before posting.

I'd like to say:

I joined the profession promised a lifetime 1/80th final salary pension. Why is it ok to change my T&C of employment 13 years in?
I'm in education - along with the announcement yesterday that 1/3rd of schools will now be considered failing, how do you expect to get good teachers in there, when you're basically saying "take your skills to the private sector"
I didn't create the financial crisis. Why am I paying for it?
I don't get the reported average 30something % pay rise that "city bankers" are getting. I believe they are a part of the problem (I'm not!) so they aren't paying for it (though it was interesting to hear the news saying that this was a "slow down" in bonuses and pay rises, and hence they are being "hit hard"). Anyone defend that?
Do you need more?

I am a Deputy Headteacher. I work over 70 hours a week. On weekdays, I am lucky to see my daughter, and usually it's when I wake her up by having a shower (at about 6am). Everyone I know I went to uni with all those years ago (including the owner of this site) earns more than me in the private sector. No exceptions. And now you're saying I don't deserve my pension because it's better than theirs?

(to be clear, I know I'm privileged - partly because I went to LSE, so this isn't actually a hard luck story - I earn enough to sort myself out - it's the comparison between private and public that is starkly illustrated by my experiences with my friends - I went into the public sector out of choice - I'd have earned far far more in the City).

You may not like the changes to your T&C's, but it is part of life in the private sector.
In a world of mergers, aquisitions and fighting against your competitors to maintain or increase market share (or even simply keep the company afloat), changes to T&C's are common, sites can be relocated hundreds (or thousands) of miles away at short notice and jobs can disappear overnight.

But of course, that is what being part of a global economy is about and that is why the private sector workforce has adapted to it's new surrounding by becoming far more flexible and mobile than it was 20 or 30 years ago. It's just another factor of modern life.

It seems only fair to most private sector employees (yes, that's right - the people who pay your wages) that the public sector should reflect the private sector and adapt to the changing world.

You actually have the same choice as all private sector employees. If you don't like the way your employer is heading, then you are free to walk and find another job. As you claim, you can do so much better in the private sector.

I do find it amusing that the only private sector employees you use as a comparison to yourself are bankers. As we know, they are an extreme case and are a tiny minority of private sector employees.
But of course, your argument wouldn't have the same gravitas if you compared yourself to the average private sector employee such as a cleaner, a scaffolder or a production line manager.

As I stated earlier, if you don't like the changes that are happening, feel free to walk out and get a "better" job in the private sector.

Co-incidentally, you may feel that you are well equipped to work in the private sector, but the private sector does not share your optimism:

"The Barclays Corporate survey suggested 57 per cent of businesses were either 'not at all interested' or 'not very interested' in employing public sector workers who had lost their jobs due to government cuts.
Businesses were said to be sceptical about the skills public servants possessed."