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Public Sector Pensions - Are they really so bad?
Comments
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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.
So how will a new entrant know what the country can afford in pension terms in 45 years ?0 -
Complete and utter toss.
The only people who are on call 24/7 with no extra payment are the armed forces and, possibly, the police.
teachers aren't, Local gov aren't, NHS staff aren't
Sorry, shouldn't have wrote "on call". Couldn't think of anything to describe "have to work regardless of the holidays, christmas etc and get no extra payment".
I agree "on call" was misleading. Meant the work is around the clock and never stops.0 -
I think this is where some are confusing bashing.
My argument would be if there is now little differential between wages in the private and public sector there should be in turn little disparity between the contributions required to sustain the pensions on offer.
You can't change it that much for those that had already signed up, but surely we have to use some common sense for the future.
It's not bashing the public sector, it is just looking at what was once set up to offset the downsides is now unsustainable if the public sector wage has caught up.0 -
Graham_Devon wrote: »Sorry, shouldn't have wrote "on call". Couldn't think of anything to describe "have to work regardless of the holidays, christmas etc and get no extra payment".
I agree "on call" was misleading. Meant the work is around the clock and never stops.
Still failing to see how that is different to the private sector and I think the private sector on average have less holiday.
I don't think your average shop worker gets paid more for a bank holiday GD.0 -
OK Bin man in public sector say £20K PA
Lets say for example in the private sector it is the same £20K
The public sector one works for 40 year and the pension is worth an additional 15%
£20K+15% = £23K X 40 = £920K 100% funded by tax payer.
So for it to work out the same cost to the tax payer the benefits after retirement (most probably 5 years later for the private employee) will have to equal nearly £1M more in today's terms to have the same tax payer cost.
Even if you use just the £3K (pension contribution) that is £120K,
That would equal an extra £6K per year state top up or £500pm or £125 per week. (popping clogs @ 85)
It does not add up as the same, sorry.
Yep about £125 would be a good opening shot.
Two real examples I personally know of.
1.)OAP, own home, basic state pension, modest saving provision say £33000. You could replace modest bin mans pension for similar impact. State Pension around £140 week council tax c.100 per month) £25 week say.
Not entitled to any other benefit except the universal ones as for 2.
2.) OAP. State pensioned £140. No property/savings, social housing rent free, no council tax, various "care" benefits denied to 1.) add circa £100 to income.
£125 difference - and no I haven't made that example up to fit but spooky your figures are not a million miles away.
For bin man on modest employee pension you could use 1.) as the basic benefits would be denied as per Stevie J. too. Plus you lose the tax on the pension so overall loss in not providing pension increases.
I don't dispute this model goes off a little as pension goes up. But don't forget, that out of that, further tax is recovered in Income Tax and discretionary spend through VAT/Duty perhaps 40%+."If you act like an illiterate man, your learning will never stop... Being uneducated, you have no fear of the future.".....
"big business is parasitic, like a mosquito, whereas I prefer the lighter touch, like that of a butterfly. "A butterfly can suck honey from the flower without damaging it," "Arunachalam Muruganantham0 -
Complete and utter toss.
The only people who are on call 24/7 with no extra payment are the armed forces and, possibly, the police.
teachers aren't, Local gov aren't, NHS staff aren't
No but NHS staff have had it cut substantially over the last 5/10 years from my personal knowledge."If you act like an illiterate man, your learning will never stop... Being uneducated, you have no fear of the future.".....
"big business is parasitic, like a mosquito, whereas I prefer the lighter touch, like that of a butterfly. "A butterfly can suck honey from the flower without damaging it," "Arunachalam Muruganantham0 -
Graham_Devon wrote: »
There are a lot of things in the private sector which the majority of public sector employees forego.
Excluding teachers, and maybe some of the civil service, the majority of the public sector are on call 24/7, which includes christmas etc, for no extra pay.
No company cars (apart from the select few), no perks, no credit cards racking up points for airmiles which you can spend and claim back, no travel costs (I was surprised the other day when one of my colleagues in the private sector announced he actually gets his costs of travelling to work and back home reimbursed!!). No parking charges for working reimbursed. No bonuses, ever.
It's all pros and cons. The pension is pretty much the last pro the public sector employee has.
Dearie me Graham,
1) Most public sector employees are not on call 24/7
2) You can only claim travel costs if you are classed 'home based'
no difference between public & private sector. Obviously few public sector people like this, but they do exist.
3) Some civil servants will have credit cards (google Met Police credit cards to see the fraud)
4) Some Public sector employees get bonuses at the higher levels.
"The pension is pretty much the last pro the public sector employee has"
Apart from shorter hours, comparative job security, very generous sick pay, higher pay in the first instance and flexi time in many instances.US housing: it's not a bubble - Moneyweek Dec 12, 20050 -
grizzly1911 wrote: »Yep about £125 would be a good opening shot.
Two real examples I personally know of.
1.)OAP, own home, basic state pension, modest saving provision say £33000. You could replace modest bin mans pension for similar impact. State Pension around £140 week council tax c.100 per month) £25 week say.
Not entitled to any other benefit except the universal ones as for 2.
2.) OAP. State pensioned £140. No property/savings, social housing rent free, no council tax, various "care" benefits denied to 1.) add circa £100 to income.
£125 difference - and no I haven't made that example up to fit but spooky your figures are not a million miles away.
But you are using examples to fit, if they earn more in the private sector why is the OAP 2 worse off? (No house no money etc??)0 -
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.
The mean average public sector pension is £7k not £5k
http://www.tuc.org.uk/extras/publicsectorpensions.pdfUS housing: it's not a bubble - Moneyweek Dec 12, 20050 -
I am not bashing, but it is very hypothetical response as we have no way of knowing what percentage of private employees this affects. What assets they had at retirement.
Just like people do not blanket the public sector you can't then make out it costs more to maintain private sector employee's in their retirement than it does a public sector one through their working life.
But is the argument we should suppliment pensions of the private sector so they are not a burden in the future.
If they earn more in the private sector is it less likely they would have to rent?
It was just an example to respond to the private sector earned more, if that was the case bin men should be on more money if it was take over by a private company.
Para 2:- that is what they are trying to do but convincing a lot of lower paid people to contribute , when they can ill afford to live in the first place, is not an easy job especially when there is a potential Equitable Life Scenario.
If the State underwrites the provision isn't that pretty much status quo?
Para 3:-
In an ideal world yes. In outsourcing as a whole wages tend to be depressed in most cases or substantially less e.g. Banagalore call centres (or in the UK for that matter )to make it stack up.
When you start debating minimum or living wage territory there is a pretty blunt tipping point between state and private sector. A lot receive benefits on top anyway to subsist."If you act like an illiterate man, your learning will never stop... Being uneducated, you have no fear of the future.".....
"big business is parasitic, like a mosquito, whereas I prefer the lighter touch, like that of a butterfly. "A butterfly can suck honey from the flower without damaging it," "Arunachalam Muruganantham0
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