Public Sector Pensions - Are they really so bad?

StevieJ

More public sector bashing, all I can say is that my company private sector pension provision is way better than most of those public sector pensions (exclusions probably the early retirees e.g. police, army). I read somewhere that the average public sector pension is around £5k, should be enough to exclude them from many of the retirement freebies handed out to the penniless state pensioners e.g. rent and council tax paid.

abaxas

Just put ALL information about the public sector in the public domain. Obviously with the exception of classified stuff.

That way you can see what everyone earns, what they do, where the money is spent etc..

It's all there and easy to find *

*because that is exactly what my OH does, audit of public sector spending.

Really2

StevieJ wrote: »

I read somewhere that the average public sector pension is around £5k,

Is that on current drawing (EG now retired)?

I thought the issue being tackled is liability, so if wages had gone up a lot in the last 10-20 years in the public sector that in turns increases the liability when those people finally get to retirement age had contributions not kept up to support this.

Graham_Devon

The long-standing difference in median wage for all jobs in each sector is hardly informative on the question of whether someone is paid more or less than their peer in the other sector. It's hard to decide what the comparison job is for a policeman, a firefighter, a teacher, and so on, and to make that comparison between medians meaningful you'd need data showing the breakdown of what kinds of jobs are done in each sector. Because it's possible, after all, that the state employs more people in more senior or middling roles, and fewer people in the kinds of jobs you find at the absolute bottom of the employment ladder.

For an illustration, we can poke around the ONS ASHE data again. The national median hourly wage is £11.03. If you take table 14_5a of the 2009 data, re-order it by wage, and look at the bottom three categories with over 1 million people in them, as a rough illustration, we have: 1,126,000 sales and retail assistants on a median hourly wage of £6.36; 1,355,000 cashiers at £6.40; 1,430,000 in sales at £6.45.

None of these are jobs you find in the public sector, although there are also cleaners at the low wage end of this table. If someone here was quoting data comparing public-private wages for the same kind of cleaning jobs, say, then that would be interesting. There's no such data on offer. The Sunday Times says: "Our reports today show, the public sector has become so big and such a generous employer that it is sucking workers out of private companies."

I don't see how they can justify this, other than with their laughable case studies, and if it's true, it should be an long-standing trend, not a new one.

http://www.guardian.co.uk/science/2010/jan/09/bad-science-ben-goldacre

grizzly1911

Really2 wrote: »

Pensions are being reformed to remove top ups are they not?

You can't blanket the cost are the same without figures to prove that.
I can't see anyone on more money 100% funded by the tax payer through their career costs the same as a private employer. (Bin person example)

The wages alone side of that tells me you have got that very wrong.

If privatisation, deregulation and free market is so good why is the American Health model in such a mess?

It costs them as a society much more than the NHS per capta from what I understand. So much is tied up in administration and bureaucracy.

I don't dispute you can quote better results for those that can afford to pay at the top end.

The problem with the binman analogy is that whilst you may be able to screw their wages down (less tax take), when you buy his services you also have to pay the management overhead to go with him and shareholder profit on top plus the end of life costs. Oh and can he come a just move this bin on another day well yes but that is cost plus.

So I still believe that the whole life cost of a bin man to you or I will be the same. If we change the rules and only collect once every two weeks then we can make some savings but then we can't afford to backtrack if that wasn't the right decision.

Now of course that profit will be fully taxed of course possibly to redress the balance?

Just my opinion by the way and we are some what off thread.

StevieJ

Really2 wrote: »

Is that on current drawing (EG now retired)?

I thought the issue being tackled is liability, so if wages had gone up a lot in the last 10-20 years in the public sector that in turns increases the liability when those people finally get to retirement age had contributions not kept up to support this.

A question, what do you think the implications would be (for public finances) if we switched all current employees onto DC instead of DB as Cameron keeps spouting?

wotsthat

StevieJ wrote: »

More public sector bashing, all I can say is that my company private sector pension provision is way better than most of those public sector pensions (exclusions probably the early retirees e.g. police, army). I read somewhere that the average public sector pension is around £5k, should be enough to exclude them from many of the retirement freebies handed out to the penniless state pensioners e.g. rent and council tax paid.

I've tried carefully not to bash the public sector workers in my posts.

It's a simple fact that to get a £5k index linked pension (plus lump sum) in the public sector requires significantly less contributions than you'd need to achieve this privately.

My take on this is that public sector pensions are unsustainable but I think public sector pensions will remain generous on a pension vs contribution measure. That said, any public sector worker with some time to retirement is very likely to get less than they think as benefits are chipped away by a series of future governments.

Really2

The Sunday Times says: "Our reports today show, the public sector has become so big and such a generous employer that it is sucking workers out of private companies."

I don't see how they can justify this, other than with their laughable case studies, and if it's true, it should be an long-standing trend, not a new one.

Well if you use this graph it clearly shows up until recently it has outperformed private sector employment growth up until 2006.
It could hint that people preffered the public sector?

sw67

i dont have a problem with people getting the pension they agreed on when starting work or changing job

New entrants should get what the country can afford in terms of pay and pensions just like the private sector and if they dont like it do something else.

StevieJ

wotsthat wrote: »

I've tried carefully not to bash the public sector workers in my posts.

It's a simple fact that to get a £5k index linked pension (plus lump sum) in the public sector requires significantly less contributions than you'd need to achieve this privately.

My take on this is that public sector pensions are unsustainable but I think public sector pensions will remain generous on a pension vs contribution measure. That said, any public sector worker with some time to retirement is very likely to get less than they think as benefits are chipped away by a series of future governments.

As I pointed out if they did not receive that pension they may receive other benefit payments e.g. payment of rent. I guess it is part of some marginal pension paradox where all is not as it seems on the surface.