Steel Icarus
ersatz maven
"The private sector pay for waste in the public sector. The reverse is not the case" etc etc etc etc etc etc
J30 strike: NUT, PCS, UCU, ATL call for a general strike on June 30th
- Thread starter ymu
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Voley
🐀
It's a real motivator at work atm I can tell you. We're all facing imminent redundancy or if we survive that we're getting a 2 year pay freeze and worse conditions yet, somehow, we're all 'hellbent' on ruining the economy.
Steel Icarus
ersatz maven
The reason the 'obvious' answer isn't promoted is that there simply isn't enough money to do so.
Private Sector pensions are investment based and moved from being final salary to defined contributions because the investment returns weren't enough to be able to pay the pensions being promised. The move to defined contributions means that pension payments are directly linked to the investment returns of the contributions.
In this country Public Sector pensions are taxation based, the taxpayer's money being used to pay today's pensions. As lifetimes increases we (as a country) simply can't afford the pension structures of yesteryear.
I work in the Private Sector, I'd love Private Sector pensions to be the Final Salary / the way they were, but I also realise this is not possible. The same is true for the vast bulk of the public. The Unions are being willingly led into an ambush on this. What's the rallying cry going to be - "We're better off than you, and we want to remain so"?
ymu
Niall Ferguson's deep-cover sock-puppet
Just found out that some work we did a couple of years ago shaved 20% off global sales of a billion dollar drug.
Of course, we waived our 10% bonus in the interests of fairness. All in this together and all that.
Steel Icarus
ersatz maven
Don't see the people with the money buying bogroll in bulk. Get it?
No, sorry that doesn't make sense to me. Please can you explain?
denniseagle
ding dong the witch is dead
I did hear someone on the radio (5live) state that the NHS pension 'pot' was £2 billion in credit and that the present government refused to publish the amount that the teachers/lecturers pension 'pot' had in credit.
The constant lies about 'gold plated ' pensions etc obviously don't factor in the simple verifiable fact that the vast majority of public sector workers will get a pension of less that £7000 per annum when they retire.
I know I will.
Yes there are some whose pension will be far greater, most notably MP's, but in reality those earning less than £20,000 per year will not have such fantastic pensions to look forward to.
Can you please explain to me why it is so wrong to want to hold onto something , however small it is in reality, rather than watch as your future living standards take a nose dive?
Funny thing is, at present, my future pension probably takes me over the threshold for all sorts of means tested benefits,so it looks like I will be paying it all back anyway should I be so lucky as to live long enough to claim it .
SpineyNorman
Inappropriate content removed
@Henno: I happen to know there has been no actuarial review of the teachers' pension fund. Surely if this is all about making the pensions sustainable and protecting them that would be the first thing you'd do?
And don't you think the massive payment holdays taken by private sector pension funds during the boom times, in order to bump up the (already huge) profits they were making, which was in turn done to increase their share prices, may have had at least as much to do with the shortfall that "forced" them into changing from final salary to money purchase?
It's an attack on the social wage. A choice between sustaining the pay and benefits of workers at the cost of reduced (but still substantial) profits for capital or sustaining the profits of capital at the expense of a reduction in the (already low) social wage.
Unsurprisingly private companies went for the latter and the government wants to follow.
And don't you think the massive payment holdays taken by private sector pension funds during the boom times, in order to bump up the (already huge) profits they were making, which was in turn done to increase their share prices, may have had at least as much to do with the shortfall that "forced" them into changing from final salary to money purchase?
It's an attack on the social wage. A choice between sustaining the pay and benefits of workers at the cost of reduced (but still substantial) profits for capital or sustaining the profits of capital at the expense of a reduction in the (already low) social wage.
Unsurprisingly private companies went for the latter and the government wants to follow.
ymu
Niall Ferguson's deep-cover sock-puppet
Thing is, I signed up to lower wages in rerurn for a more flexible employer and a secure and generous, if expensive, pension. Now ten years of low pay on, my pension is worth half what I expected when I struggled to afford it, and the employer now so inflexible I am self-employed.
Is there anything wrong with just raking the bankers' bonuses off them, going back as many years as it takes. Seeing as they actually caused thus so-called crisis.
Is there anything wrong with just raking the bankers' bonuses off them, going back as many years as it takes. Seeing as they actually caused thus so-called crisis.
The average public sector pension is just over 4K a year for a man, and less than 2 and a half K for a woman.
Not only that, but certainly in the North East around 70% of all money spent on the public sector goes straight into the local economy, including obviously the private sector.
Yes I agree that certainly has had an effect, and the law should be changed to prevent that. On the other hand though, surely you'd agree that life expectancy has increased since pensions were first introduced, and that has pushed up the cost of pensions. When pensions were first introduced those people that did make it to retirement age were only expected to live for a few years as pensioners. Those retiring now can expect to live until their late 70's. The extra years of pension payments add up to much larger overall payout. Lengthy retirements with high pension payments are unsustainable. That's an unpalatable truth that successive governments have ignored for the past 30 years due to the obvious political fallout. It's also the reason why Labour have been conspicuously silent on the issue - they too know we can't continue to ignore the problem.
The average private sector, defined contributions 'pot' at age 60 is 30K. A joint annuity (partner plus spouse) purchased at 60 for 30K would provide 900 pounds a year.
To put it another way, based on the ONS statistics, an average private sector employee would need to put away 40% of their salary in order to accrue a 'pot' that would provide the same pension as public sector worker would receive.
After the proposed changes to public sector pensions, the average private sector employee would need to put away 30% of their salary in order to accrue a 'pot' that would provide the same pension as public sector worker would receive.
You can see how difficult it will be to get the sympathy of the private sector employees. As I said before the Unions need avoid walking into this political ambush.
Unfortunately it would be illegal as the bonuses were paid without any clawback clauses. Bonuses have now started to be paid with various clawback clauses / linkages (though mainly to the banks long term profitability). Nevertheless the pensions crisis has been caused primarily by longer life expectancies. The bankers can be blamed for many things, but its difficult to pin that one on them!
Unfortunately it would be illegal as the bonuses were paid without any clawback clauses. Bonuses have now started to be paid with various clawback clauses / linkages (though mainly to the banks long term profitability). Nevertheless the pensions crisis has been caused primarily by longer life expectancies. The bankers can be blamed for many things, but its difficult to pin that one on them!
ymu
Niall Ferguson's deep-cover sock-puppet
There is no crisis in public sector pensions. There is no need to do this.
If they can claw back my pension, we can take the bankers assets off them. Fuck you if you think I'm gonna be screwed over just because they own the politicians. Plenty of lamp-posts if they don't like it.
Steel Icarus
ersatz maven
Quite. I'm reading loads of ill-feeling - "why should I work longer and pay more tax so public sector workers can get bigger pensions and retire earlier? (accusation of public sector "not producing anything/being wasteful/full of one-eared paedo Rasta lezzers" optional).
The crisis is that Public Sector pension payments of today are funded by tax collected today. There is no investment activity as in the private sector. Public sector pension payments are going to continue to increase as retired public sector employees live longer lives. That's the crisis.
Governments can do some or all of the following;
(1) Increase taxes (to give themselves more money to pay the pensions)
(2) Cut expenditure elsewhere (to give themselves more money to pay the pensions)
(2) Reduce the pension payments (to reduce the overall pension payment amount)
(3) Increase the retirement age (to reduce the number of payments, which will reduce the overall pension payment amount)
Bankers aren't involved in your pension. Just the Government whose only source of income is the taxpayer.
Steel Icarus
ersatz maven
What money did the government use to bail out the banks? I sure as shit wasn't involved in the banking crisis. Neither were my two friends that have already lost their library jobs. Or my other mate whose hospital job has unofficially got 2 months left.
goldenecitrone
post tenebras lux
The banks are special though. If we don't give them money they will fuck off to Switzerland. Public sector workers aren't going anywhere, apart from Butlins or Blackpool.
ymu
Niall Ferguson's deep-cover sock-puppet
Pay as you go pensions are more efficient from the government's point of view. It's a small amount, there is no crisis.
No one disagrees that the pension age should rise, it's raising it for people so close to retirement that's unfair. Older women in the public sector have had six years added to their working lives in the last decade or so, whilst their childcare costs have rocketed. Now they'll lose an extra 2-5% of their income on pension contributions, during a pay freeze with inflation running at 5%+.
It won't happen. There'll be dead politicians and bankers before this is allowed to pass. It undermines the whole economy, and leaves private sector workers even more exposed. Most of them aren't too stupid to realise this.
No one disagrees that the pension age should rise, it's raising it for people so close to retirement that's unfair. Older women in the public sector have had six years added to their working lives in the last decade or so, whilst their childcare costs have rocketed. Now they'll lose an extra 2-5% of their income on pension contributions, during a pay freeze with inflation running at 5%+.
It won't happen. There'll be dead politicians and bankers before this is allowed to pass. It undermines the whole economy, and leaves private sector workers even more exposed. Most of them aren't too stupid to realise this.
I think you've mixing two separate issues - which easily done as the Government is tackling two problems with basically the same approach and doing to so at the same time.
The pensions crisis is separate from the government's debt problems.
The governments debt problems were definitely exacerbated by the bailouts to the banks, but the key issue was that spending had started to exceed income.
Alastair Darling: "By 2007 We had reached the limits of what I thought we should be spending"
Tony Blair: "We should accept that from 2005 onwards Labour was insufficiently vigorous in limiting or eliminating the structural deficit."
According to the IFS :-
http://www.ifs.org.uk/bns/bn93.pdf
"On the eve of the financial crisis, the UK had one of the largest structural budget deficits among either the G7 or the OECD countries and a higher level of public sector debt than most other OECD countries, though lower than most other G7 countries. Most OECD governments did more to reduce their structural deficit during the period from 1997 to 2007 than Labour did. This fiscal position formed the backdrop to the financial crisis."
The Government can only raise taxes and/or cut spending to tackle its debt. It has the same options to tackle the public sector pensions issue, with the added options of increasing the retirement age and amending the size of the pensions payments.
BigTom
Well-Known Member
I don't think this is true. I've been in the public sector for the last couple of years and I definitely pay into a pension, as does my employer - I assumed that any pension I get will come out of the pot created by everyone paying into the pension scheme. Backed and guaranteed by taxpayers yes, but not directly funded by.. State pensions are funded by taxpayers of course, but are public sector pensions?
If it was just about age of retirement, I don't think there'd be an argument about it, but the combination of changes in increasing payments, switching from RPI to CPI and changing from a final salary to career average along with raising the age of retirement is about much more than the ageing population - which is indeed a problem that needs to be resolved.
Just as a matter of pedantry this really isn't true. In the case of pensions, public sector workers and employees pay into pension schemes. More broadly, governments have lots of investments and often own companies (eg: Royal Mail) which generate revenue for the government. This is most visible in countries like Norway or Qatar, who have used oil to create sovereign investment funds rather than spunking it up the wall.
BigTom
Well-Known Member
the rest of your post can wait, but the bit in bold isn't true, there is a third option, which is that the government can stimulate growth, which will have the effect of raising tax revenue and cutting spending but is not directly either of them. (edit: and a fourth one, which is to sell off those parts of the government which earn money for it, capitalising on future revenue and making us poorer in the long run.. an option if there's nowhere else to go, I just think it's not a good idea to flog your stuff to pay off a debt unless you really have to.
In terms of the analaogy with pensions, raising taxes is effectively the same as raising the retirement age (increased pensions contributions / tax contributions over someones lifetime), whilst "amending" the size of the payouts (only if you're amending downwards obv) is like cutting spending.
But if the public sector pension pots are in a healthy state, as people here have claimed, is there any current deficit that needs dealing with? What needs dealing with is the issue of people leading longer lives, and raising the retirement age seems to me to be the right way of doing that - not making everyone live a more miserable, and longer, retirement.
More broadly, the same argument is that if public sector pensions are worsened, then it simply gives private sector companies space to worsen theirs as well.
Meanwhile, of course, the wealth of the richest continues to grow at a nice rate.. but I guess we don't get to talk about the possibility for huge redistribution of wealth
Well don't forget the employer at the end is the Government, which means the employers money solely obtained from the taxpayers.
But you're right the subject is more nuanced than my short post. The vast bulk of the cost is borne by the taxpayer. A good article can be found at http://www.bbc.co.uk/blogs/thereporters/stephanieflanders/2010/06/some_of_the_truth_about_public.html
True, though how does the Government do that? Some would say that you need to cut spending in order to cut taxes to 'free up' entrepreneurs / business. Others would say that you need to raise taxes to raise spending to 'prime the pump'.
I agree. The increase in retirement age would be considerable though. Just amending the age alone would be politically difficult, not sure what the figure would need to be but it would easily be 70+. Anyone fancy telling the country they need to work till they're, say 75? Anyone fancy working till they're 75? Would you vote for a party that did that?
SpineyNorman
Inappropriate content removed
Can you respond to the part of my post you ignored please Henno? The part about there not having been an actuarial review of teachers' pensions? If it's all about protecting them and making them sustainable this is absolutely essential.
Why haven't they done it? Come on, let's hear your justification. If this is really a technocratic consideration that would have been the first thing they would have done. Which suggests their motivations are very different from those you are ascribing to them.
And don't you think it might be a good idea for those at the very top, those who earn obscene amounts and either do nothing at all or play a destructive role in the real economy, to contribute? And not just to public sector pensions either.
Why haven't they done it? Come on, let's hear your justification. If this is really a technocratic consideration that would have been the first thing they would have done. Which suggests their motivations are very different from those you are ascribing to them.
And don't you think it might be a good idea for those at the very top, those who earn obscene amounts and either do nothing at all or play a destructive role in the real economy, to contribute? And not just to public sector pensions either.
