Is it fair that Govt employees get DB and private sector employees DC (in general)

[Deleted User]

Having said this, the issue isnt “DB” vs “DC”. 

The issue is quite simply the value of benefits taxpayers provide to civil service. Taxpayers contribute a lot more to civil service pensions than private sector. That’s the issue. And part of that value is the guarantee, the fact that the taxpayer takes on all the risk. 

And yes, it is unfair that a plumber has to not only fund but also underwrite Whitehall’s far more generous pensions than what he can afford for himself. Ultimately it translates to high taxes and deficits and damages the overall economy. And to the kind of damaging populism we have seen rising in more than one country. 

Linton

Deleted_User said:

Having said this, the issue isnt “DB” vs “DC”. 

The issue is quite simply the value of benefits taxpayers provide to civil service. Taxpayers contribute a lot more to civil service pensions than private sector. That’s the issue. And part of that value is the guarantee, the fact that the taxpayer takes on all the risk. 

And yes, it is unfair that a plumber has to not only fund but also underwrite Whitehall’s far more generous pensions than what he can afford for himself. Ultimately it translates to high taxes and deficits and damages the overall economy. And to the kind of damaging populism we have seen rising in more than one country. 

Lots of things in pensions and in the rest of life  are unfair.  Which ones are highlighted rather depends on the political agenda one wishes to promote.

doris540

I totally agree that having Public sector pensions worth many times more than us in the Private sector is obscene especially as its us helping pay for them. As ive already said what i find really unjust is in these troubled times our private sector pensions are getting battered from here to next week , ok you say you in it for the full run and things will turn round hopefully, However Public sector pensions arent touched whats on the bottom line is what you will get , with many been DB or Career average schemes and for all those stating"Get a job in the pubic sector if you dont like it" i presume these are from people sitting pretty with the attitude "Im alright jack" because i got a nice retirement coming or on one. Many manual workers in the private sector have no option but to work to they are OAP retiring not as many do in Public sector go at 55 or 60 at the latest with it not having a huge impact on their income some not all are i gather actually better off taking their pension early than if they carried on working .Personally i had my FS scheme took from under my feet in 2005 transfered over into  a DC scheme with a miserly 5%  paid by employer unlike the big percentages paid by the Public sector via our taxes. The last statement on the old FS scheme wasnt exactly alot £283 a month as of this year i know it goes up each year and if the company folds and the government are liable wont even see that much Yet the Public sector .....................totally untouched

Thrugelmir

doris540 said:

I totally agree that having Public sector pensions worth many times more than us in the Private sector is obscene especially as its us helping pay for them. As ive already said what i find really unjust is in these troubled times our private sector pensions are getting battered from here to next week , ok you say you in it for the full run and things will turn round hopefully, However Public sector pensions arent touched whats on the bottom line is what you will get , with many been DB or Career average schemes and for all those stating"Get a job in the pubic sector if you dont like it" i presume these are from people sitting pretty with the attitude "Im alright jack" because i got a nice retirement coming or on one. Many manual workers in the private sector have no option but to work to they are OAP retiring not as many do in Public sector go at 55 or 60 at the latest with it not having a huge impact on their income some not all are i gather actually better off taking their pension early than if they carried on working .Personally i had my FS scheme took from under my feet in 2005 transfered over into  a DC scheme with a miserly 5%  paid by employer unlike the big percentages paid by the Public sector via our taxes. The last statement on the old FS scheme wasnt exactly alot £283 a month as of this year i know it goes up each year and if the company folds and the government are liable wont even see that much Yet the Public sector .....................totally untouched

Wonder why Labour have never addressed the issue. The influence of the Unions perhaps?

Bravepants

Rather than join a public body for the CS pension you should do what some of my acquaintances do; start your own business, buy a massive house and car, spend £1000s on bottles of champagne in the posh clubs of London while not saving a penny and then...ask the government to bail you out when you have no savings and your business is about to fail due to a chance random and catastrophic event! Why don't you complain about that?

steampowered

Deleted_User said:

You cannot be serious. At least I hope so.  Past ~100 years’ worth of data do not guarantee future returns over the next 40.  And your claim that there has never been a loss in “major markets” over any 10 year period is plain wrong. Ask the Japanese. Market still hasn’t reached peaks from the last century. Or Americans who remember the 1970s. 

You are ignoring reinvestment of dividends. Even so, Americans who started work in 1970s will only have retired in the last few years. Literally decades after the US stock market had recovered from the 1970s.

Trying to say that it is a "risk" that people might lose money on the markets if invested for the next 40 years is tin foil hat territory. That's an infinitesimally small risk - right up there with the risk of alien invasion or nuclear war. Certainly statistically much less of a risk than the risk of the government going bust. Claiming that DC pensions are somehow "risky" because they rely on stock market investments is just scare mongering with zero logic behind it.

hyubh

steampowered said:

Trying to say that it is a "risk" that people might lose money on the markets if invested for the next 40 years is tin foil hat territory. That's an infinitesimally small risk - right up there with the risk of alien invasion or nuclear war. Certainly statistically much less of a risk than the risk of the government going bust. Claiming that DC pensions are somehow "risky" because they rely on stock market investments is just scare mongering with zero logic behind it.

Ahem... of course DC pensions are 'risky', for the individual, compared to DB - with the latter, all the risk is with the sponsoring employer. Why do you think private sector DB schemes closed almost en masse in about a decade...? 

[Deleted User]

steampowered said:

Deleted_User said:

You cannot be serious. At least I hope so.  Past ~100 years’ worth of data do not guarantee future returns over the next 40.  And your claim that there has never been a loss in “major markets” over any 10 year period is plain wrong. Ask the Japanese. Market still hasn’t reached peaks from the last century. Or Americans who remember the 1970s. 

You are ignoring reinvestment of dividends. Even so, Americans who started work in 1970s will only have retired in the last few years. Literally decades after the US stock market had recovered from the 1970s.

Trying to say that it is a "risk" that people might lose money on the markets if invested for the next 40 years is tin foil hat territory. That's an infinitesimally small risk - right up there with the risk of alien invasion or nuclear war. Certainly statistically much less of a risk than the risk of the government going bust. Claiming that DC pensions are somehow "risky" because they rely on stock market investments is just scare mongering with zero logic behind it.

Wow. This is dangerous thinking. The whole concept of investment is based on risks and returns. Having eyes opened and understanding risks is NOT scaremongering. Being ignorant isn’t smart.

ian1246

I m a serving Police Officer. I ve been in the job for 5 years and my take home pay is about £1600 a month after deductions - including Anti-Social Pay. For my job, I get to go and deal with individuals who want to actively hurt me. I have been spat on, I ve been assaulted a number of times. I deal with Public Order Incidents where there is a not inconsiderable risk to myself and colleagues if it goes wrong - including the potential for death. I deploy to horrific RTC's (worst one was deploying to a Riot 60+miles away, in full Code 1's - Riot Gear - only to come across a fatal 3 way RTC which had just happened. Had to crawl into the back of the crushed vehicle and hold the driver's head for 1+hour, in horrific cramped conditions with my pads digging into my groin and legs, whilst fire cut the vehicle out around us - all while the cocker spaniel which had been travelling in the front footwell of the passenger seats screamed in agony due to its broken back). 

I deliver death messages and comfort the grieving families. I routinely witness Child Abuse Images and walk into living conditions you wouldn't deem fit to keep animals in - as well as going to sudden death's which may or may not be recent, exposing myself to horrific smells, rotten flesh, rotten bodily fluids and images which I will never forget.... and I routinely work 11+hours without any sort of break, routinely have my shifts extended or altered without prior notice and my Rest Days (Days Off) Cancelled with next to no notice - regardless of what plans myself or family had. Now... we get to deal with Covid 19, with myself and colleagues likely at a greater chance of catching it than most.

All that for my fantastic record breaking £1600 a month - after 5 years of service (5 lots of pay rises). My "Gold Plated Pension" which some of you seem so very bitter about me getting in another 30 years time (I m 30years old) involves a "Tiny" contribution from myself of 13.7% Gross Pay - how many of you pay similar into your Private Pensions? That Pension is about the only thing which my Job has going for it in terms of finance.

That pension will have been more than earnt by the time I get it. Those of you who think you are entitled to have any input into it... your not. If you want a pension like it - get a grip, take responsibility for your own future and finances and make it happen. Don't go criticising others well earnt and deserved pensions.

Thrugelmir

steampowered said:

Deleted_User said:

You cannot be serious. At least I hope so.  Past ~100 years’ worth of data do not guarantee future returns over the next 40.  And your claim that there has never been a loss in “major markets” over any 10 year period is plain wrong. Ask the Japanese. Market still hasn’t reached peaks from the last century. Or Americans who remember the 1970s. 

You are ignoring reinvestment of dividends. Even so, Americans who started work in 1970s will only have retired in the last few years. Literally decades after the US stock market had recovered from the 1970s.

US companies historically haven't been good dividend payers primarily due to tax reasons. Microsoft although founded back in 70's. Never paid a dividend until 2003. Amazon has never declared a dividend, nor has Alphabet. Markets around the world differ historically in many ways.