Public Sector Pension Reform In Trouble?

Tromking

FBU (and Judges) win their age discrimination case against the Government. Great news potentially for all public servants who were moved from their old pension schemes to the new CARE schemes in 2015.


https://www.fbu.org.uk/news/2018/12/20/firefighters-win-major-pension-legal-case-against-government

michaels

People who earn above average with pensioners terms that those in the private sector couldn't even dream of decide that the average tax payer who is much poorer than they are should give them even more. What's not to like as long as you believe that the purpose of the state is to take from the poor and give to the rich, a sort of reverse robin hood....

Tromking

michaels wrote: »

People who earn above average with pensioners terms that those in the private sector couldn't even dream of decide that the average tax payer who is much poorer than they are should give them even more. What's not to like as long as you believe that the purpose of the state is to take from the poor and give to the rich, a sort of reverse robin hood....

In this case it looks the "average taxpayer" has been let down by a incompetent Government that in its attempt to reform public sector pensions acted unlawfully.
They deserve better.

ffacoffipawb

Tromking wrote: »

FBU (and Judges) win their age discrimination case against the Government. Great news potentially for all public servants who were moved from their old pension schemes to the new CARE schemes in 2015.


https://www.fbu.org.uk/news/2018/12/20/firefighters-win-major-pension-legal-case-against-government

Move them all into the new scheme for future accrual, save even more money?

hugheskevi

Move them all into the new scheme for future accrual, save even more money?

Too late for that to have a meaningful impact, as all members except those working past normal pension age would be in the new schemes by April 2022 under the current rules.

Taking into account the time to appeal the judgement (if appealed), consult on new scheme, legislate new scheme and implement new scheme the number of protected members left when it was complete will be pretty small.

If it is necessary to redo public service pension reform, it will be interesting to see whether the government simply copies what was previously implemented minus transitional protection or re-opens the whole reform question again and does something different.

m_c_s

Looks like this is going to be very expensive for the government covering most of the civil service. It's now out of their hands but could still go to the supreme court to try and overturn the decision.
https://www.theguardian.com/society/2019/jan/30/tax-payers-face-4bn-annual-pension-bill-after-court-ruling

hugheskevi

Looks like this is going to be very expensive for the government covering most of the civil service.

The Civil Service is a fairly small portion of the total cost, as the biggest public service pension scheme by some margin is the NHS pension scheme.

Probably the biggest individual winners from the ruling are MPs themselves, along with judges, as their post 2015 schemes were significantly less generous than the pre-2015 schemes.

Given IPSA is responsible for the remuneration package of MPs, if there were to be an unexpected significant increase in the pension value, there would logically be a reversal of the recent significant pay increase for MPs...

The Treasury Written Ministerial Statement about this issue is available at this link.

m_c_s

hugheskevi wrote: »

The Treasury Written Ministerial Statement about this issue is available at this link.

Seems the Government have taken this very seriously by pausing the revaluation of Public Sector pensions due in April. No point doing that if they have to turn the clock back to 2015 or offer compensation to redress the issue. Interesting to see how this plays out since the cost is enormous and the solution may be very complex.

Paul_Herring

if there were to be an unexpected significant increase in the pension value, there would logically be a reversal of the recent significant pay increase for MPs...

That's an.. optimistic.. interpretation.

Wesley_Donnelly

The reason why public sector pension reform is in trouble is quite simple. The transitional arrangements put in place have been found to be unlawful, they discriminate on the grounds of age, race and sex.
The government spin is now that this will cost the taxpayer an extra 4 billion pounds a year.
Or another way of looking at it is the government have acted illegally and will now have to pay out the money that was rightfully and lawfully promised.
If the government had quite simply introduced a new public sector pension scheme for new recruits this whole mess would have been avoided it is a mess of their own making.