A quarter of a million staff opt out of NHS pension

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  • kidmugsy
    kidmugsy Posts: 12,709 Forumite
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    AnotherJoe wrote: »
    You'd expect youngsters predominately to opt out because they ... may not intend to stay very long

    An argument that seems to be as common as it is bogus: silly, silly "younger people".
    Free the dunston one next time too.
  • SuiDreams
    SuiDreams Posts: 2,393 Forumite
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    My sister worked in the NHS for about 10 year (maybe more), she never paid into the pension scheme, she thought the 3% they wanted to take off her when she 1st stared was a bit expensive. You can't tell some people.
  • fred246
    fred246 Posts: 3,620 Forumite
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    I sense a sort of change in 20 to 30 year olds. I used to say "work hard. Pay into your pension. Retire early." The young people now are saying that retirement isn't something that's going to happen for them. Take it easy. Don't work too hard. It's a long way to go. You will always work and never retire. If you'll never retire a pension isn't necessary.
  • andy001
    andy001 Posts: 119 Forumite
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    A the OP stated, "worrying trend amongst younger people" when looking objectively at the graph.[/QUOTE]

    I was focussing on the graph alone and NOT looking at greater details. Thanks for pointing it out.

    NHS pension / DC pension: LTA, AA taxes, tapered allowance taxes are some of the reasons why senior members are leaving.

    If October budget again reduces AA , then likely it's not cost effective to stay in.. Ministers are tinkering pension too often and making it less attractive with each change.

    If there is exodus from such pensions, who will pay for retired members ? it is reliant on contributions from existing members to pay for retired folks.

    NHS still needs senior doctors, consultants and GPs to stay on
    & younger ones should be looked after well with pension etc so they don't Emigrate to Oz

    See article from Altmann.. interesting read ..

    https://www.telegraph.co.uk/news/2017/04/07/perverse-pension-rules-driving-best-workers-labour-market/
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    Please seek independent financial advice.
  • kidmugsy
    kidmugsy Posts: 12,709 Forumite
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    All this biz about doctors retiring early - and it's true; I know two - is just an example of the fact that people respond to economic incentives.

    You put up minimum wage - employers will employ fewer staff.
    You put up pay - you'll find it easier to attract and retain staff.
    Et ruddy cetera. It's not rocket surgery.
    Free the dunston one next time too.
  • Malthusian
    Malthusian Posts: 10,936 Forumite
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    There's an increasing consensus that the Lifetime Allowance is pointless and should be scrapped. While I agree in principle, I wonder if the reason it won't happen is not because HMRC would miss the (relatively trivial) take from Lifetime Allowance charges, but because we can't afford for high-earning NHS staff to go back into the NHS Pension Scheme en masse. (And other civil servants with large DB pensions.)
  • ex-pat_scot
    ex-pat_scot Posts: 693 Forumite
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    Malthusian wrote: »
    There's an increasing consensus that the Lifetime Allowance is pointless and should be scrapped. While I agree in principle, I wonder if the reason it won't happen is not because HMRC would miss the (relatively trivial) take from Lifetime Allowance charges, but because we can't afford for high-earning NHS staff to go back into the NHS Pension Scheme en masse. (And other civil servants with large DB pensions.)





    NO.




    The reason the ludicrous LTA won't be scrapped is quite simple.


    It would be because it would be an open invitation for the opposition to scream "HUGE TAX BREAK FOR TERESA'S RICH CHUMS" or some such nonsense.
  • BobQ
    BobQ Posts: 11,181 Forumite
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    Malthusian wrote: »
    There's an increasing consensus that the Lifetime Allowance is pointless and should be scrapped. While I agree in principle, I wonder if the reason it won't happen is not because HMRC would miss the (relatively trivial) take from Lifetime Allowance charges, but because we can't afford for high-earning NHS staff to go back into the NHS Pension Scheme en masse. (And other civil servants with large DB pensions.)

    Not only does the Government get a lot of dosh from people exceeding the LTA, there are rumours that the Budget will see it reduce and raise even more.

    "The amount of money raised from those exceeding the lifetime allowance has surged by nearly 2,000 per cent over the past decade.

    For the first time HM Revenue & Customs has released figures showing the total tax take from those exceeding the lifetime allowance tax has increased from £5m in 2006/07 to £102m in 2016/17.
    Most of the increase has taken place since 2012 when the government started cutting the lifetime allowance from £1.8m to £1m.
    Meanwhile the tax raised from those exceeding the annual allowance has increased from £2m in 2006/07 to £561m in 2016/17 - an increase of nearly 28,000 per cent."

    From the FT
    Few people are capable of expressing with equanimity opinions which differ from the prejudices of their social environment. Most people are incapable of forming such opinions.
  • AnotherJoe
    AnotherJoe Posts: 19,622 Forumite
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    edited 13 October 2018 at 1:01AM
    kidmugsy wrote: »
    An argument that seems to be as common as it is bogus: silly, silly "younger people".
    Ive got some sympathy with that argument, its not totally dud..

    Lets say this is a going to be 2 or 3 year job, its likely not that well paid, the utility of the extra money now may well be more useful to someone than income in 40+ years time. Money in 40 years time isn't always better than money now.

    The money might mean the difference between being able to pay the rent or not. Of course if it just means they can have an extra decaf moccochino with their smashed avocado on toast its a different matter.

    And lastly they may decide that when they start their real job and progress up the career ladder, in a few years time the much larger salary they earn then will very quickly allow them to put in the pittance they didn't put in aged 21.

    Of course in reality for many, the xtra few % wont be missed, the 2 or 3 year job turns into a 20 or 30 year job or, 20-30 x 2-3 year jobs and the money now would only have been spent on heinz instead of lidl baked beans and the discipline of contributing to a pension carries through to higher salaries (rather than opting out and never back in again as theres always something else to do with the money)

    But even given that I wouldnt dismiss out of hand everyone for not taking the pension. (the civil service person was wrong because he didnt use any of the above reasons, he simply had a complete failure to understand how the pension worked, worrying for a supposed high flyer)
  • OldBeanz
    OldBeanz Posts: 1,401 Forumite
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    My niece (in-law) did not start one as she was going to set up her own practice. Never happened.
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