Should I withdraw from Public Pension Scheme

Moby

dunstonh wrote: »

And who is willing to pay for that?

A Robin Hood Tax on the rich!

BobQ

dshart wrote: »

I say they should make any new starts in the public sector go onto a similar system to private workers with stakeholder pension or this new NEST system that they are proposing.

This is such a simple idea, how come the Government has not adopted it. The Government is playing fast an loose with accrued pension entitlements. This is part of the distrust that pervades the public sector.

The civil service abandoned FS schemes for new entrants in 2007. In the next 10 years even if no changes were made the majority of civil servants will be on a career average scheme. The situation is already being sensibly managed in this way and will reduce costs.

The proposed changes could reduce the future benefits for all staff and this is a fair decision for a Governmemt to make and its for staff to stay or leave based on their view of the changes.

What many in the civil service think is unacceptable is reducing the benefits they have already earned by the us of the CPI ruse when they were told for years that the RPI was the index being used. This is so disingenuous of the ConDems.

CannySaver_2

BobQ wrote: »

The civil service abandoned FS schemes for new entrants in 2007.

What many in the civil service think is unacceptable is reducing the benefits they have already earned by the us of the CPI ruse when they were told for years that the RPI was the index being used. This is so disingenuous of the ConDems.

The civil service though still have defined benefit schemes with zero investment risk, most people in the private sector have to make decisions re how their pension is invested and rely on growth to produce the return. Most people I know in the private sector would sell their granny for a civil service pension or indeed any other of the public sector pensions.

Re the switch from RPI to CPI, again most people in the private sector buy an Annuity (other options are available), the difference in the starting level of income between a level and RPI linked annuity is between 40 and 50%. Yes, it might not be great to have had it switched from RPI to CPI but it's better than most in the private sector get.

The government should offer workers in the public sector two options: (1.) Keep your benefits the same but you need to increase your payments by £X per month to do so

(2.) Keep your payments the same but your benefits will be reduce by £X per year or you will have to wait Y years until you get them

That would introduce choice, there would also be the scope for a third, middle ground, between the two options.

But people in the public sector need to realise that having no investment risk is a massive, massive, benefit and striking at a time when the government (and I am no apologist for this government) are making concessions, there are approaching 3 million people out of work (with 1m young people looking for jobs), and the economy is shot is not the right thing to do.

Rant over! :mad:

The Canny Saver

CannySaver_2

Moby wrote: »

A Robin Hood Tax on the rich!

Sarcastic or serious?

Moby

CannySaver wrote: »

Sarcastic or serious?

Watch the news every day and you'll see growing public dissatisfaction with the banking system and with those who control resources and wealth. There are major gaps developing between our Govmt and those Govmts in Euro Land about a financial tax. The Germans & French will press ahead with it despite opposition from our 'leaders'. Merkel said last night that they intend to ensure that the proceeds from such a tax will stay within the boundaries of those countries implementing it. Where there is a will there is a way.

We are in danger of being left on the sidelines because of our little Englander fears which dominate Tory policy. Cameron's last speech went down like a lead balloon. Extremely stupid policy...dominated by fears of infighting within tory ranks re. Europe. We deserve better because our major trade is with the countries we are alienating!

CannySaver_2

Moby wrote: »

Watch the news every day and you'll see growing public dissatisfaction with the banking system and with those who control resources and wealth. There are major gaps developing between our Govmt and those Govmts in Euro Land about a financial tax. The Germans & French will press ahead with it despite opposition from our 'leaders'. Merkel said last night that they intend to ensure that the proceeds from such a tax will stay within the boundaries of those countries implementing it. Where there is a will there is a way.

We are in danger of being left on the sidelines because of our little Englander fears which dominate Tory policy. Cameron's last speech went down like a lead balloon. Extremely stupid policy...dominated by fears of infighting within tory ranks re. Europe. We deserve better because our major trade is with the countries we are alienating!

But how do you define a 'Robin Hood' tax? Are you talking about a Tobin Tax? If you are Cameron has already said he is not opposed, just wants it to be implimented worldwide

Don't disagree about "little Englander" syndrome, not a good trait, but then neither is saying everything is right in Europe, which some do.

The Canny Saver

dunstonh

Watch the news every day and you'll see growing public dissatisfaction with the banking system and with those who control resources and wealth.

ahh. So you have fallen for the political position that everyone who earns more or has money is a banker.

Andy_L

CannySaver wrote: »

Re the switch from RPI to CPI, again most people in the private sector buy an Annuity (other options are available), the difference in the starting level of income between a level and RPI linked annuity is between 40 and 50%. Yes, it might not be great to have had it switched from RPI to CPI but it's better than most in the private sector get.

how happy would you be if you'd bought the RPI linked annuity & then the providor changed the indexation to CPI?

dshart

Moby wrote: »

Watch the news every day and you'll see growing public dissatisfaction with the banking system and with those who control resources and wealth. There are major gaps developing between our Govmt and those Govmts in Euro Land about a financial tax. The Germans & French will press ahead with it despite opposition from our 'leaders'. Merkel said last night that they intend to ensure that the proceeds from such a tax will stay within the boundaries of those countries implementing it. Where there is a will there is a way.

We are in danger of being left on the sidelines because of our little Englander fears which dominate Tory policy. Cameron's last speech went down like a lead balloon. Extremely stupid policy...dominated by fears of infighting within tory ranks re. Europe. We deserve better because our major trade is with the countries we are alienating!

A "Robin Hood" tax is a joke, it will only really have the effect of making many middle earners poorer and dragging more better off low earners into a higher tax bracket. The real high earners can afford to avoid it through different schemes.

As for taxing companies they have to thread a very careful line there as if the company tax system is too high, companies will just move elsewhere. Look at the fuss currently being made by the oil companies regarding the extra tax that this government implemented. Whether you think it is right or wrong it doesnt matter as if it becomes too unfavourable the companies will stop investing in the sector. The same applies to the financial sector which is a huge employer in the city of London, if the tax situation becomes to burdensome for them then they will move their operations elsewhere. You may think whats the big deal if we lose a few bankers, but it is a huge deal if complete banking operations move abroad. This is why the government want it to be an international effort rather than individual countries going it alone on some of these taxes proposed.

dshart

Andy_L wrote: »

how happy would you be if you'd bought the RPI linked annuity & then the providor changed the indexation to CPI?

But the public sector workers havent purchased anything yet, they have contributed to a scheme with defined benefits and the scheme is being modified in a way. Yes people have a right to be upset with the changes but they also must realise the reasons why change is necessary. In a private pension the employee contributes to build a pension pot to buy the annuity, along the way there are many changes made to the private pension rules on what can and cannot be included, how it should be invested, tax benefits etc. These all conspire to affect the final pot which may mean the final outcome is nothing like expected when the pension was first taken out. At the end you have your pension pot and you buy an annuity and even at this stage there is no guarantee as annuity rates fluctuate. So your example doesnt really work.