Government U-Turn or Pragmatism?

wotsthat

My view is that it's a bit of both.

The unions are playing a dangerous game here though and have misjudged the public mood - there are parallels with Greece.

The protesters there might be about to find out the hard way that whilst they were protesting about being less well off they've suddenly gone bankrupt.

It must make the Chinese titter though to see how self-indulgent and entitled us Europeans are.

http://www.bbc.co.uk/news/uk-politics-15549321

The government is urging unions to accept revised proposals it has made for public sector pensions, which it says are a "deal for a generation".

No-one within 10 years of retirement will have to work longer or see their pension income decrease as a result.

David Cameron told MPs the improved offer was "very fair" to workers.

But union leaders said the package was a "long way" from being accepted and preparations for strike action later this month would go ahead.

Thrugelmir

wotsthat wrote: »

The unions are playing a dangerous game here though and have misjudged the public mood - there are parallels with Greece.

Pensions in Greece will have to be universally cut as totally unaffordable.
Different situation to the UK where there's a growing divide between average public and private sector pension provision.

Mr Brown's raid on the private pension sector is still remembered by many.

So the Government will need adopt further reform to rebalance the situation.

ManAtHome

Thrugelmir wrote: »

Mr Brown's raid on the private pension sector is still remembered by many.

As well as King's raid on annuity returns..

Thrugelmir

ManAtHome wrote: »

As well as King's raid on annuity returns..

For different purposes though.

Cutting dividend tax credits was used to fund the growth of the public sector.

QE is in attempt to avoid deflation.

ILW

Thrugelmir wrote: »

For different purposes though.

Cutting dividend tax credits was used to fund the growth of the public sector.

QE is in attempt to avoid deflation.

A bit of deflation would be very nice, thank you.

CLAPTON

Thrugelmir wrote: »

Pensions in Greece will have to be universally cut as totally unaffordable.
Different situation to the UK where there's a growing divide between average public and private sector pension provision.

Mr Brown's raid on the private pension sector is still remembered by many.

So the Government will need adopt further reform to rebalance the situation.

Brown's raid on pensions was used to fund a reduction in corporation tax which was generally welcomed at the time
it only became a raid on pensions later

Thrugelmir

CLAPTON wrote: »

Brown's raid on pensions was used to fund a reduction in corporation tax which was generally welcomed at the time
it only became a raid on pensions later

Another Brown stealth tax. That meant that the pledge not to raise income tax was not broken.

Of course the side effect has been to make occupational pension schemes in the private sector fewer and fewer in number.

CLAPTON

Thrugelmir wrote: »

Another Brown stealth tax. That meant that the pledge not to raise income tax was not broken.

Of course the side effect has been to make occupational pension schemes in the private sector fewer and fewer in number.

stealth tax? it was headline news

in any event the reduction of employee pensions in the private sector has been corporate greed (which has not applied to the board members of senior execs)

brown's tax would only have reduced the payouts

zappahey

Thrugelmir wrote: »

Another Brown stealth tax. That meant that the pledge not to raise income tax was not broken.

Of course the side effect has been to make occupational pension schemes in the private sector fewer and fewer in number.

If you really believe that that is the cause of the reduction in private sector pension schemes, then I have a nice bridge that I can sell you.

Procrastinator333

wotsthat wrote: »

My view is that it's a bit of both.

The unions are playing a dangerous game here though and have misjudged the public mood - there are parallels with Greece.

The protesters there might be about to find out the hard way that whilst they were protesting about being less well off they've suddenly gone bankrupt.

It must make the Chinese titter though to see how self-indulgent and entitled us Europeans are.

http://www.bbc.co.uk/news/uk-politics-15549321

I would hope that the government are smart enough for it to have been part of the plan. E.g.

We need £1bn saving. Therefore tell them we are cutting £2bn. The unions were going to threaten and probably go through with a strike whatever the start point for the cuts. Now they are threatening, offer to backtrack by 0.5bn. They strike. Offer to backtrack by another 0.5bn. Now the government is back to where it wanted to be, a 1bn cut, but importantly the unions now just look greedy if they keep going and probably have little support left.

At least, that is how I would play that game.

Thrugelmir

CLAPTON wrote: »

stealth tax? it was headline news

Did the average personal plan holder realise the impact on the value of their pots over 30 years?

I doubt it.