Labours pension threat - daily express

cfw1994

Malthusian wrote: »

I'm sure those lower paid employees who didn't or couldn't sell their shares in time were delighted to have been paid in worthless toilet paper all those years instead of cold hard cash. Meaning they spent a proportion of their time, equivalent to the proportion of their remuneration they accepted in the form of shares, working for free.

This is why the majority of workers aren't paid in share options already. They don't want them. And with good reason. They aren't responsible for whether the company succeeds or fails so it's not equitable to be paid based on something they have 0.01% control over. And the lower your pay, the less capacity you have to absorb the loss of part of your remuneration if the company goes bust.

Directors are in control, and as they are highly paid, they can still afford to hire someone to play the world's smallest violin for them if their incompetence leads to them losing thousands or millions in personal wealth.

Companies would be very happy to save money by paying the rank and file in potentially worthless share options rather than more expensive cash, but they can't get away with it, except at the top level.

And the odd exception like your doomed Canadian employer, who are the exception for a reason.

ShareSave type schemes only make sense for an employee if you get a tax incentive and/or free shares from your employer to compensate you for the risk. Without those things you are just being paid with a spin on red or black instead of cash, which is worth less than the equivalent amount of cash. And even if you do have access to ShareSave, you should sell the shares and reinvest in something more diverse as soon as you can do so without penalty.

Unless I’m misreading something, I suspect you may be misunderstanding something...
I work for a US tech company....in good years, the managers have some stock to share around: it is not instead of salary, but as a bonus, in addition to it. Quite a nice thing, actually, and a tool to help retain staff.
Of course, going bankrupt renders them useless (unless they were able to have sold them)...but they were “money” never earned in the first place.

On the original question....let’s see what is in the manifesto. Having company shares can work well (see John Lewis for a good UK example). Mugging companies of shares in a mandatory manner might be less desirable....& yes, over time it could be detrimental to pension plans: a reason to invest your pension more globally, I would suggest!!

ruperts

Malthusian wrote: »

You think that it is likely that Labour will pay taxpayers' money to bankers and rich people to acquire private company shares.

Okily dokily then.

What you personally choose to believe does not alter Labour policy.

Which is as stated by McDonnell to confiscate 10% of shares of any company with more than 250 employees and pay the dividends to the state (minus an irrelevant pittance to the workers, which will be absorbed into their general remuneration, i.e. wages will go down to compensate).

The 'Labour policy' (which is not actually a policy yet but rather an idea) has not been fully detailed and nowhere has McDonnell used the word "confiscated". The method by which the shares will be acquired has not been confirmed.

As you know full well it is not only "bankers and rich people" that own shares. Being disingenuous like that only serves to lessen the credibility of the rest of your argument.

I do agree that the £500 cap on dividends makes the whole idea rather pointless for most workers, which is why it's not an idea I particularly like.

[Deleted User]

On the original question....let’s see what is in the manifesto. Having company shares can work well (see John Lewis for a good UK example).

I am not aware of the government taking most of JL workers dividends. That’s not the main issue though. You could have employee owned companies operate in a market environment. The structural issue comes when the majority of companies have employees driving strategic decisions. When banks start deciding whether to give a loan or not based on the impact on employment at the bank with profitability becoming a minor concern. When workers at failing companies can’t be let go because they are the decision makers. That’s aside from the enforced transfer of property, which will lead to capital flight.

Malthusian

cfw1994 wrote: »

I work for a US tech company....in good years, the managers have some stock to share around: it is not instead of salary, but as a bonus, in addition to it.

Everything you earn that is not salary is instead of salary.

If the employees didn't value it the owners would hang onto their shares as it would be pointless to give it away. They pay their employees partially in stock because some employees will accept lower salaries if they are given shares in lieu. Especially skilled technical staff who understand the future value of the business and can survive on a reduced cash salary. This is especially good for a startup which needs to hoard every penny, and benefits hugely if it can persuade skilled individuals to accept payment in potential unicorn shares rather than cash.

A startup company running a local garage by contrast is unlikely to pay mechanics in shares, because there is no possibility of the company going unicorn and the mechanics won't value the shares highly enough to accept a significantly lower salary.

Whether individual employees are motivated by earning stock as they think it will moon, or view it as worthless and treat any return as a bonus, does not matter at business level. If the employees as a whole assigned their shares a weighted value of nil, the owners would not pay their employees in shares, as they would be giving away potential future wealth for no reason.

Of course, going bankrupt renders them useless (unless they were able to have sold them)...but they were “money” never earned in the first place.

Of course they earned it. They worked, they were given shares / options and some cash. That's earnings. Try telling the IRS that they didn't earn the shares, they were just a free gift so they don't have to pay tax on them (if the shares acquire a value).

ruperts wrote: »

The 'Labour policy' (which is not actually a policy yet but rather an idea) has not been fully detailed and nowhere has McDonnell used the word "confiscated". The method by which the shares will be acquired has not been confirmed.

Vagueness is not an advantage when it comes to proposed national policy. Only in Labourland can you justify a policy on the basis of "We don't know what it is, therefore it can't possibly have any disadvantages".

As you know full well it is not only "bankers and rich people" that own shares.

No, but it mostly is. If shares were mostly owned by the man in the street McDonnell wouldn't have made his proposal, the means of production would already be in the hands of the workers.

Pretending ignorance of who owns the majority of shares in this country (institutional investors and rich people) will not alter Labour's policy to confiscate 10% of company shares and pay the dividends to the Government.

Londonlisa12

Mick70 wrote: »

Mind you , also being reported that the torys plan on raising state pension age to 75!!

They have planned no such thing.

This was recommended in a report by the Centre for Social Justice think tank. The Department for Work and Pensions told us it is not government policy to do this.

MK62

ruperts wrote: »

The 'Labour policy' (which is not actually a policy yet but rather an idea) has not been fully detailed .........

......rather a common theme with the current Labour party.......;)

[Deleted User]

ITV debates were frustrating. Understand questions about Brexit. Yes, huge issue. Austerity, money trees... Fair enough.

Then they moved on to the terrible danger of American drugs finding their nefarious way into the NHS. “Give us your word that you are not a liar”. Then they got talking about being sorry for the victims of sex crimes in the US (presumably because this would never ever happen in Britain). Also sorry for the world poor because... climate. Presents, love for the UN General Secretary, Dickens, Monarchy... whatever.

Not one word about the issues in this topic. You’d have thought these are pertinent questions to be asked.

JoeCrystal

What an annoying debate! I would say it is a draw. I am somewhat more annoyed by the facts that they kept on talking even after the chair asked them to stop. And the fact crowd control seems to be non-existent — applauding all the time, for example.

But yes, as the main issues I am personally concerned with so far, they said preciously little, unfortunately.

[Deleted User]

But yes, as the main issues I am personally concerned with so far, they said preciously little, unfortunately.

They were not asked. They were asked about all sorts of irrelevant BS, but not about things that impact retirees. Nor were they given the time to develop meaningful points. Weird format

Malthusian

Deleted_User wrote: »

Then they got talking about being sorry for the victims of sex crimes in the US (presumably because this would never ever happen in Britain).

Perish the thought. Corbyn sacked Sarah Champion, one of his few competent and principled ministers, for running her mouth on that subject.

Not one word about the issues in this topic. You’d have thought these are pertinent questions to be asked.

To be asked, certainly. To be asked of Boris Johnson and Jeremy Corbyn? If you thought the actual debate was annoying, then try to picture Johnson and Corbyn shouting half-remembered half-baked nonsense at the wall behind each other. Neither has the faintest understanding of economics or pension law. Asking Corbyn and Johnson to debate economic policy or pension reform is like organising a chess match between Wayne Rooney and Conor McGregor.

They may as well stick to stuff they can at least pretend to know what they're talking about, like "gitting Brexit durn" (no understanding required, you just need to know which side you're on), and spending other people's money.