Public Sector Pay Restraint Ending?

antrobus

Silvertabby wrote: »

AFAIK, only the LGPS is funded. Pensions for the NHS, Civil Service, Armed Forces, Police, etc etc are paid for out of general taxation.

I believe that to be correct. Only the LGPS is funded.

Silvertabby

True, but the NHS scheme has always delivered a 'profit' to the government even when it was 'final salary'. Now that it is a CARE scheme and with the increased staff contributions I assume this will at least continue along similar lines.

Why does everyone assume that CARE is a universal step down? Yes, in the case of the NHS, someone who starts off as a junior doctor and ends as a senior consultant would be better off in a final salary scheme - but the vast majority of public sector workers only move up 2 or 3 grades throughout their careers. These people, who obviously tend to be the lower paid, could actually be better off with a CARE pension due to the double annual increase (salary plus pension revaluation) and the more favourable accrual rate.

Think I'm joking? When the LGPS switched from final salary to CARE in 2014, Unison made a great fuss about the 'protections' they had secured for their members. In short, this was the 'underpin' which applied to everyone within 10 years of NRA at the date of change - these people would have their benefits calculated under both schemes - all final salary or final salary/CARE - and they would receive the highest amount. We were swamped with requests for estimates up to 10 years ahead so people could see how much they would 'lose' under CARE so they could decide if they should opt out of the LGPS in order to 'preserve their pensions at the highest rate'.

Less than 2% benefitted from the underpin. The rest were better off with CARE.

antrobus

paparossco wrote: »

True, but the NHS scheme has always delivered a 'profit' to the government even when it was 'final salary'. Now that it is a CARE scheme and with the increased staff contributions I assume this will at least continue along similar lines.

Profit?

How can you have a profit when the NHS pension scheme has a deficit of £381 billion quid?

The scheme accounts show a net expenditure of £29 billion for 2015-16. That's what lost people call a loss.:)

https://www.nhsbsa.nhs.uk/sites/default/files/2017-04/56324%20NHS%20Pension%20Scheme%20HC%20370%20Web%20only%20%282015-16%20accounts%29.pdf

chucknorris

Silvertabby wrote: »

AFAIK, only the LGPS is funded. Pensions for the NHS, Civil Service, Armed Forces, Police, etc etc are paid for out of general taxation.

Also mine the TPS (teachers pension scheme) is not fully funded.

Silvertabby

Also mine the TPS (teachers pension scheme)

Sorry - how could I have missed you out !

chucknorris

Silvertabby wrote: »

Sorry - how could I have missed you out !

Well you sort of covered it with etc. etc.

Thrugelmir

Ours is an by analogy scheme at the current time. Currently mirrors the Civil Service. We aren't public sector employees as such as employed by a private limited compnany. Though our shareholders are Public Sector bodies. Current employer contribution rate is 26%. Able to buy up to £6,500 of pension in the scheme. Conversion to cash of 12:1.

Looking ahead further changes are on the horizon though.

chucknorris

Thrugelmir wrote: »

Ours is an by analogy scheme at the current time. Currently mirrors the Civil Service. We aren't public sector employees as such as employed by a private limited compnany. Though our shareholders are Public Sector bodies. Current employer contribution rate is 26%. Able to buy up to £6,500 of pension in the scheme. Conversion to cash of 12:1.

Looking ahead further changes are on the horizon though.

Same as me Thrug, technically universities (where I work) are in the private sector, but I see that as name only, in every way that I am aware of, it is the same as I would imagine it is working in the public sector.

kabayiri

Some bloke came on R5 at lunchtime and said that unless a policeman earned £71K he/she was a net taker.

He broke down the figures, and used a friend as an example, someone who retired at 48 and could easily live another 30+ years needing pension funding.

Is this why we can't afford more police?

Diane Abbott can afford loads of police for a measly 300 mill.

System

They are overpaid when you consider how valuable DB pensions are...