Why do we pay council workers Pension ???

MPD

Former PM David Cameron promised no changes to public sector pensions for 25 years following the last change. If future governments keep this promise the next change will be 2039 for LGPS and the following year or 2 for other schemes.

This ignores the link to SPA which forces changes to NRA based on when everyone else gets their state pension. This may reduce the Daily Mail pensions apartheid headlines.

le_loup

kidmugsy wrote: »

Of course it would be cheaper if we just hanged 'em all when they reached pension age, but not absolutely all of them would deserve it.

No. Far too good for them. Hanging, drawing and quartering would provide a far better spectacle for hard working council tax payers ................. and would keep private enterprise pensioners occupied on Thursdays now that they can't collect their pensions from the post office. Shameful!

AlanP_2

I worked in the private sector and self-employment for 28 years and secured a LA job 9 years ago after being made redundant for the 4th time.

For a similar role to the last job I had before that move my basic salary dropped by 20% and I lost out on an annual bonus that added another 20-25% to my earnings so overall I am down about 40% compared to my private sector "equivalence".

Pension arrangements are much better obviously and that is the main reason I have stayed with them, I would rather have the deferred earnings from the better pension when I retire than the disposable income now.

The LA where I live, which is not the one I am employed by, had to contribute just over 30% of it's Council Tax Revenue to the Pension Scheme last year.

Council Tax only generates 11% of it's reported "income" so pension cost is actually around 3% of its nominal "turnover" so nowhere near as expensive as headline numbers would make it seem.

Taking out all central government "income" (the majority of which is Housing Benefit btw so the LA are acting as their local agent for this) so just leaving locally generated income (Council Tax & Fees / Car Parking etc) then it works out to about 8% going into the pension fund.

2014 changes to make the LGPS a Career Average scheme will slowly reduce the overall value to the employee / cost to the employer but it will still be better than a DC scheme, or at least more reliable.

Going forward general central government grant funding is being removed in 2020 so council taxes will have to increase to make up for the shortfall (10% of income, £10m in my example LA) so once that happens and you are paying more Council Tax the percentage going into pensions will reduce so you should be happier then :rotfl:

EDIT - Forgot to point out that for the LA in question only 11% of the council tax they collect is retained by them (74% to county, 11% to Police and 4% to Town / Parish councils) so while 30% of it's council tax income goes into the pension fund
only 3% of what local householders pay is going into it.

I haven't looked but it will be similar at the county level so about 6% of what you pay in Council Tax is going towards funding Local Gov pensions.

Hopefully that also will make you feel better.

greenglide

Why do we always get these posts aimed at public sector pensions where everyone wants to take them away? I assume it is all part of the "race to the bottom" that this country is fixated with.

It would be much better if we had a move towards better terms and conditions of the private sector so that, maybe, we could bring back decent ensigns for the private sector.

I personally don't want this country to be the low wage, low regulation economy that many seem to want. Aspirations should be better.

JoeCrystal

I think that is one of the points behind auto-enrollment as the pension provision in the private sector is pretty dire. My employer is contributing only 2% at the moment and yet they even have a cheek to say that they are proud to contribute above the minimum required.

Having said that, I am trying to convince my employer that they ought to pay in more, even pointing out that there are salary sacrifice option that can be included or even a way to reward long service with higher employer's contribution after a certain period of time. Alas, there is no interest in that.

So ultimately, I think the private sector pension schemes will get better providing that the government increases the minimum contribution required from the employers over next decade or so. A minimum employer's contribution of 10% can help a long way.

woolly_wombat

JoeCrystal wrote: »

So ultimately, I think the private sector pension schemes will get better providing that the government increases the minimum contribution required from the employers over next decade or so.

I think that will probably be the direction of travel, along with tightening up questionable 'self-employed' status à la Pimlico Plumbers, Uber etc.

Andy_L

Whatever system of pension council workers had, you would end up paying for them

AlanP_2

Andy_L wrote: »

Whatever system of pension council workers had, you would end up paying for them

The same as we all do for Tesco's, BT/Sky, your local plumber / taxi driver and every other employer or self employed person in one way or another.

bigadaj

le_loup wrote: »

No. Far too good for them. Hanging, drawing and quartering would provide a far better spectacle for hard working council tax payers ................. and would keep private enterprise pensioners occupied on Thursdays now that they can't collect their pensions from the post office. Shameful!

Bit messy, and there wouldn't be many street cleaners around to tidy up.

System

Hi

I just realised how stupid I am.

I pay council tax, and have done for over 40 years, so when I wasn't in the LGPS I was subsidising all those others.

When I was, I was paying twice, via my contributions and my council tax.

Have I been stupidly ripped off?