Thursday, 27 November 2014

Housing staff set to join public sector strike

Social housing providers will be hit by a national day of strike action on Wednesday over plans to change public sector pensions.

Housing officers and repairs staff are set to walk out, joining around one million local government workers across the UK.

The government claims that historically generous public sector pensions are unsustainable, and wants public sector workers to pay more in contributions. The final pension would be based on average earnings over the individual’s whole career, rather than their final salary.

Dave Prentis, general secretary of Unison, which represents around 100,000 housing workers, said: ‘Public sector workers spend their lives providing vital services and care deeply about their communities. They have had their pay frozen and seen rising workloads, as jobs and services are slashed. Now government ministers’ are coming for their pensions.

‘We are willing to negotiate with government ministers’ any time, any place, but we still have no deal that we can put to a single one of these workers. We want pensions that are secure and sustainable and give people dignity in their retirement. The door is open, it’s time to talk.’

Housing workers in arm’s-length management organisations and housing associations made up of stock transferred properties are also affected by the pension changes.

Many associations and councils are planning to close all housing offices on Wednesday.

Readers' comments (40)

  • Evan Owen

    We can't afford public sector pensions!!!

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  • Well we have had to pay into them - unlike a lot of other people who just don't bother! I was paying over £200 per month - should have stuck it under the mattress. How much are you paying?

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  • We can't afford them because not everyone (tax dodgers, non doms big companies, bankers) do not pay their fair share.

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  • Daedalus

    Evan,

    I am in the LGPS pension scheme, and employed by a Housing Association.

    This scheme is fully funded by my employer and by myself. The scheme has a small deficit, but recent increases will address this small shortfall. NO GOVERNMENT MONEY goes into this scheme.

    Please explain why I should have reduced benefits, higher contributions, and have to work longer. I am very confused!

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  • Yes, not all the schemes are Tax payer supported.

    Personally, I'm thinking it'll be worth just putting pension money aside and investing yourselves rather than any of these schemes, since they just get taken away from you anyway.

    If only we could opt out paying the government pensions...

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  • Although I would add. A day of striking from Housing staff will probably make no difference.

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  • F451

    Perhaps workers should 'save the public purse' and cease participation in the pension schemes completely as Narra suggests - were that to happen the proverbial really would hit the fan because public sector workers pay £millions each month into pension funds, the absence of which would leave a terminal hole within the financial sector and the economy. And they do this to secure a decent return in retirement - not the riches the demonisers spread their lies about, but modest sums that permit a modest standard of living on around £1kpcm.

    Private sector workers who's lack of solidarity has permitted worse deals should not use their own lack of ability to demand the public sector follow them over the cliff.

    Let the strike go on - after all as the Tories and posters on this site have said before: the public sector has nothing to do with the real economy, they do not produce anything after all - so what's to be missed if they strike then - or where those accusations all lies.

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  • Average pension payout from the LGPS is £4kpa...

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  • We cannot afford public sector pensions??

    1. So it is ok for an employer to say sorry we are changing your terms and conditions whether you like it or not?

    2. The employer (ie the state) is a bit lax on the £79.9bn lost through tax evasion and tax fraud - Perhaps if they chased that up they could afford?

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  • Alpha One

    If F451, all public sector workers ceased to pay into their pensions, those pensions would still receive contributions from the tax payer, i.e. me and you and of course those public sector workers.

    In the private sector, if you stop paying into your pension guess what happens? You get nothing in your pension, no taxation is paid into it for you.

    The private sector ended these valuable pensions 10+ years ago because they were unsustainable. It realised that people are living longer and wanting to retire at the same age, if not earlier. The money that was there had to stretch 5, 10 or even 20 years longer than it was originally intended to do.

    We didn't get an option on this, the pension schemes were closed. Sure we could have unionised and protested, but the end result would have been the same since the cause of the problem would remain, people living longer.

    Unless you're seriously advocating the selective culling of the over 65s, the pension pot that exists for the public sector simply does not have the resources to pay for everyone without taxes going up. Jack suggests closing the loopholes would but £79.9b back into the economy, it's a drop in the ocean compared with the potential black hole in pensions.

    No amount of striking is going to change the root cause of the problem.

    I heard someone on the TV last night saying there was overwhelming support for the strikes, funny when surveys have showed most people don't support the strikes and, on average, only 25% of those eligible to vote for industrial action have actually voted yes, with less than, on average, 33% of those eligible to vote actually bothering to vote. I'd hardly call that overwhelming support, a higher percentage of the population voted in X-Factor on saturday!

    As for your last flippant remark about the public sector having no effect, of course it has an effect on the economy. These are people that assist productivity, if schools strike parents have to stop home, if train drivers strike then people can't get to work. However, does that mean that those people provide make a product that can be sold to produce growth, no, they are facilitators of growth sure, but if you take out the effect they have in faciltating people getting to work etc you don't lose productivity or growth in the economy. You're basically twisting words to suit your own agenda.

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  • Alpha One - thats just as much a distortion of the strike ballot as saying only 6.8% of those eligible to vote against it did so.

    Secondly if £79.9bn wont make a dent in figures then why does this government always complain of between £2 - 5bn benefit fraud?

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  • F451

    Alpha - public or private, if you stop making contributions then no contributions are made - the government does not make contributions into an individuals pension pot regardless - how stupid do you take readers for if you expect them to believe you on this - this is really sub standard stuff from you today Alpha.

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  • Well played by the government.

    They've got the electorate arguing amongst themselves about who is worse off, and encouraging a 'race to the bottom' in which no on wins - except, of course, the very rich.

    What we should all be doing, whether we are in the private or public sector, is looking for the best deal for everyone.

    Talk of things like public sector 'gold plated pensions', and the notion that teachers knock-off after 35 hours, are right-wing media constructs. They have about as much creedance as the idea that all bankers or all politicians are 'evil.' The Coalition needs no spin doctors - they've got the press doing all the hard work for them.

    Like I say, we should be looking for fair terms and conditions for all. I work in the public sector and accept I might have to work a bit longer than my parents, and I might have to contribute more. But in return could I - and all other UK citizens - have an adequate pension when I retire please? Or am I being unreasonable?

    And could we all accept that to have a healthy and productive society we need to pay a decent wage to teachers, nurses, the police, the fire brigade etc?

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  • Alpha One

    Jack, it's not distortion it's fact. The highest turnout, I believe was one of the teachers unions, which could still only muster 45% turnout and then only muster 78% support. The lowest turnout was 25% which only mustered 60% support! You take the average across all 29 unions and it's c. 25% yes vote with a c. 33% turnout.

    We don't know whether the people who couldn't be bothered to vote supported the strike or not, they didn't vote. However, that they didn't put pen to paper and vote, suggests to me that, at best, they are ambivalent to strike action, but more likely don't want to be seen to support it.

    As for the government complaining about benefit fraud, they do this because it is people taking money out of the system who are not entitled to it. Unlike income tax avoidance, which is people keeping money they are legally entitled to keep (but which I don't justify or agree with), benefit fraud is people, illegally, taking money out of the system that we could use better in it.

    F451, true, I retract that part of my comment, but I'd hardly say it was sub-standard stuff, the rest of what I said is true, striking will not help as the cause of the problem is the unsustainability of people living longer but expecting the same payout for no greater input.

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  • Lee Page

    What seems to have been missed is that the LGPS IS sustainable, at least for the next 20 years. That was the agreement reached way back in 2008 (so much for a long term agreement). At this time publci sector workers accepted (albeit under protest) that they would work longer and have have the basis on whcih their pensions were calculated reduced.

    The £2.8bn the governemnt is attempting to raise over the next couple of years from these changes is not even going into any so called pensions deficit, but is simply a cash grab to plug the hole in the economy caused by recklessness in the financial sector.

    I hear calls that the public sector must take its share of the overall burden on the economy - so a two year pay freeze and 500,000 job losses doesn't count?!

    The sheer affrontery of this government leaves me speechless. We've seen sustained attacks on our pay and conditions for years, enough is enough.

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  • F451

    Thanks Alpha - you are correct, Striking will not deal with the cause of the problem. Unfortunately as the Smug Party showed earlier today, nor will the Government nor the Opposition (I use that term in its sense as a noun). At least Striking will hold a torch up to the suffering being caused for no or little gain, and to raise a protest to the Government that they change direction.

    Cameron insists, for other nations, that such protest be permitted and has argued against heavy handed police tactics, over-responding, and using the vehicles of the State to stiffle protest. This is a good position for him to take, and one I look forward to him maintaining for this country too. Indeed the supply of 1-2-1 policing for the recent protesting students shows just how much he cares to protect those wishing to show their disagreement with what he is doing. I'm sure his listening is a logical next step.

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  • Alpha One

    Anon Ymous, I think you'd be hard pressed to find someone who doesn't support fair pay for teachers, doctors, nurses etc. These people are front line workers and even the most right wing would admit these people deserve a decent wage and, to an extent, a decent pension.

    The problem is the army of adminstrators, coordinators and other assorted backroom staff who don't provide frontline services but seem to take home decent pay and pretty good pensions. If we could diassociate the backroom staff from the frontline staff in the public sector and apply cuts to them, their pay and pensions, I think you'd be hard pressed to find anyone who wouldn't support that (apart from the people facing the cuts of course).

    But it doesn't work that way, which is sad, because it means teachers get cuts to their salaries and pensions in the same way the diversity coordinators and the climate change operatives do. I know which ones I'd rather see being adversely affected by the cuts!

    F451, I tend to agree that it's not helpful for the Gove to be out there telling unions they are wrecking the economy, as much as it's not really unreasonable to expect unions to have a majority supporting the strikes and voting in them.

    However, I don't see the 'suffering', but then maybe my idea of suffering is a bit more closed that yours is. I don't deem people being asked to take a cut in their pension pot suffering, for me suffering is the people being murdered in Egypt just for wanting free and fair elections.

    Also I don't see how they can change direction on this issue, other than going to the culling the population solution!

    My problem with these strikes is that they were organised back in September when the TUC decided to have a national strike, and funnily all of the unions have worked towards that date. It's as close to old system of sympathy strikes as you can get, whilst still being legal.

    It feels to me like a few old dinosaurs throwing their weight around to try and prove they are still relevant. It seems to me that when the tories get into power we get these strikes, they respond by curtailing strike laws, to much support from the electorate (if you went to a referendum tomorrow with the question, should unions have to raise gain a yes vote at least 51% of their membership to go on strike, I guarantee you would win comfortably).

    The unions think they are playing the big man, standing up to the government, reality is they are making their own graves. Gove was the fall guy, he said what Cameron, Osborne et. al. were thinking. If the unions continue down this path Cameron will have not option but to restrict strike powers.

    The question then is, which way to the Lib Dems fall? For my money they'll be allowed to abstain on conscience, with a few rebels voting against, but Cameron will win by a decent majority (if assume all 317 tories vote yes). If they choose to vote against the proposal then it will end the coalition and probably trigger an election. If that happens, on this issue, the tories will get their majority.

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  • F451

    Let's hope by taking action now Alpha we don't need to wait for protesters being murdered in the streets, poor people starving or taking their own lives as they can not face the suffering any longer, before those who can not see that which is worth saving from decay are spurred to recognise that perhaps a different path is required.

    Waiting for a forseeable disaster is not a good strategy in anyone's books, other than those who get off on pain and suffering I suppose. Do we have to wait for our society to decay to the levels of those led by regimes and dictators before you will admit there may be a problem that needs addressing Alpha?

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  • Mike Batt

    'if you went to a referendum tomorrow with the question, should unions have to raise gain a yes vote at least 51% of their membership to go on strike, I guarantee you would win comfortably'

    I'd imagine the unions would agree if you could get the 'majority' of the population to take part in the referendum...

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  • F451

    I don't believe there would be a sufficient turn out at the referendum to make such an outcome stick Melvin, particularly if it was held on a weekday when there were soaps to watch, or the weekend why SiCo Productions keep the populace numbed.

    If you applied the same logic to election half the District and County Councillors, and nearly all the Parish Councillors, not to mention a large proportion of the MEP's, and some MP's even would all have to consider themselves as not democratically elected.

    I for one would accept - without referendum - the impossition of a true majority restriction, but only if it applied to all voting.

    How many tranfer ballots would have been unsuccessful had the rule been applied Melvin? You are so right in this instance to point out the simple flaw in the argument.

    However, something does need to be done to avoid the uber-right jumping on their bandwagons. If true majority rules can not be bought in for all voting then perhaps reconsidering the overbearing rules governing strike votes need to be re-examined to get away from the strange situation where the process of arranging the ballot, conducting the ballot, and then calling the strike requires months to pass in the dispute - surely a simpler timeline would focus both sides on the need to come to a solution and avoid the sort of grandstanding and abuse of process the Government has been able to partake in over this particular ballot.

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  • For Evan and anybody else who believes that 'we' can't afford public sector pensions; please check your facts first. The Local Government Pension Scheme is fully funded and sustainable. This should not be an argument about private vs public sector but about the pay gap. Local government workers have also had their pay frozen since 2009 whereas the financial sector is back to receiving huge bonuses.

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  • F451

    Gareth you start off so right and end up so wrong.

    The pension scheme is fully funded, and workers contribute significant proportions of their pay to keep it that way.

    The pay gap is not the issue - low pay is the issue

    Whilst a few are getting large bonuses in the financial sector most are not.

    It is too easy to allow the 'them' to trap the 'us' in divesive side debates and so detract attention from the fundemental inequalities of payment for work done, and the fact that the top 1% through their greed and mismanagement have destabilsed the economy.

    Another poster pointed to the fact that we should recognise the 'money shortage'. There is no less money than there was - it simply is sitting in a few hands where it used to be spread at least a little wider.

    The enemy is working against you not working alongside you.

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  • I have to admit to a lot of sympathy with the LG staff to an extent. It appears from all reports that their scheme is 'fully funded' - however, I don't think that that is the argument here.

    I would ask everyone how much their employer is paying? The last report I heard was that the 'employee' was paying 6% - a reasonable contribution - but that the employers were paying "at least 13%" but that was from a Headmaster who was going on strike because it wasn't fair that he would have to pay another 3% (of his £60K salary) to get his £38K pension when he retired.

    The whole argument is clouded in mystery. To get a £38K pension in the current market (£6K per annum per £100K of "pot") requires savings of £633K - or more if you want to take out a lump sum.

    I know this is extreme: headmasters are not representative of the whole public sector, but there again merchant bankers aren't representative of the private sector.

    The whole question (being suitably distorted by everyone) is the balance of what the employer is paying compared with the employee - at present "at least 13%" compared to 6% seems somewhat unbalanced.

    If this fully funded claim is based on the continuation of "at least 13%" up to retirement, then I can see the Government's point - it is not sustainable in the long term. As with the best of the private sector - a matched contribution basis - and then an index linked scheme paying out from retirement age - with the exception of those who pay enhanced contribuitions on health grounds (police, firefighters) who should be expected to move from frontline duties to back office duties when no longer available to perform the physical side of their job.

    Maybe sounds harsh - but that's the reality

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  • Chris Webb

    If your savings pot size of 633k is correct Neil then even with the employer paying 13% that would take 55 years to collect - that suggests then that there is something wrong with that model because, as you state, the fund is not deficit.

    The other point that occurs to me is that if you had negotiated with your employer to put in 13% to your pension (and let's face it there are business leader examples who have negotiated far higher than that) who am I to tell you that it is unbalanced and your employer should reduce what you have agreed with them.

    Taking into account the companies are resisting share holders from agreeing the detail of pay and rewards, do you really think that there is a precedent for the customers to get involved in your pay negotiations?

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  • Some of the comments made by different posters are repeating some of the misleading information which has been put out there, which is a great shame.

    Firstly, the call for a strike ballot was not to simply to refuse any pension reforms, it was to bring the Government back to the negotiating table after they announced their decision while still supposedly negotiating with unions. In fact, one of the greatest lies by ministers in the last few days is their call for unions to return to the negotiation table, how can you call it a negotiation when you've announced your decision already.

    Secondly, when it comes to unions, ballots are almost always quite low. As a previous active member of a union (not in public sector though) I had the experience that many members tended to leave any voting to their representatives. This has been the case for decades, and is the case in many countries, not just the UK, and has been the same in unions in the private sector, as well as public.

    Thirdly, when Lord Hutton predicted a deficit in some schemes, he listed a number of reasons why this is an issue now, and not in previous years. One of those reasons given was the expected cuts in public sector staff, resulting in a huge reduction in contributions. Another was the baby boomers who are now retiring, thus increasing the number of pension claims.

    Fourth, and completely ignored by ministers and many people, public sector pension schemes have paid into the treasury in the past when contributions created a surplus. Several schemes are fully funded, while several others schemes are not in deficit.

    Fifth, the contributions made by individuals differ between different schemes, and employer contributions differ between different schemes. Some changes have already taken place 3 years ago for some schemes, including the pensionable age and pension amounts, and unions accept that more changes need to take place, the sticking points are more to do with the pace of change and the fact that some changes are being made across the board, regardless of the scheme.

    The interesting thing about the way ministers are insisting they are simply following the report written by Lord Hutton is that they are selectively ignoring some bits, ignoring his comments that changes should not be made across the board without recognising differences between schemes, that rapid changes could be harmful to pension schemes and that public sector pensions are far from being gold plated.

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  • Alpha One

    How can you sit there and say that the scheme is fully funded?

    If the public pension pot is £1tn (say), and it's meant to cover some 3m people based on a retirement age of 65 and a likely life expectancy of 10 years, how can that same pension pot, with no extra contributions, the same retirement age AND the same annual income support the same amount of people who have a life expectancy of 15 - 20 years following retirement?

    I'm sorry if I've missed something but on simple maths, you can't make the same amount of money stretch further whilst still receiving the same income from it, unless of course you have a money tree.

    Even if you assume that not all of the 3m people will survive the extra 5 or 10 years, you would also have to assume others will live 20 or even 30 years, there still would not be enough money in the pot.

    I don't see how that is sustainable. Even if you push up the retirement age by a couple of years you still couldn't cover the extra money required, you would still need to raise contributions and reduce payouts to make it stretch further. The only other alternative is to reduce the number of people who the pot benefits!

    Gareth, I can assure that in the private sector we have had pay freezes since 2007, most of us at some point (and some still are) expected to take pay cuts (some get the benefit of reduced hours most don't), and most of us haven't seen a bonus since 2006. We also don't get nice final or even average salary pension schemes, and our employer contributions (if we're lucky enough to get one) are generally no more than 5%, more are more like 3%. We have to save and hope and pray that our pots increase in value to pay for our retirement.

    Your statement about the financial would be a great comparison if it wasn't patently untrue. Sure the management and the bosses have got mega payrises and bonuses, but the staff on the ground, the ones you see and talk to every day, the ones who didn't gamble our money away, the ones who help you out. Well they are in a worse boat. Most of them haven't seen a pay rise since 2006, won't hope to see one for another 10 years, have given up hope of receiving a bonus, have witnessed their 'bonuses' from the past (i.e. shares) drop so far and so fast that they are virtually worthless and are living under the constant threat of redundancy. Do you really think those people are the fortunate ones?

    In all this banker bashing people forget that the real people who suffered werent' the casino hedge funders or even the mangers and bosses, it was the ordinary every day staff who lost their jobs.

    As for the suffering F451, I'm sorry but having your pension cut isn't anywhere close to being beaten and murdered in the street by over zealous government militia, and to think that that would happen in this country over a few strikes is rather foolish. It would take the full on decay of our society to even get close to that state. Sure we don't need things to get that bad, but things are very, very, very long way from being that bad, and no small single event will tip that scale.

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  • Alpha One

    I forgot to mention the pay gap, I don't think there is a person in this country (well in the 99%) who wouldn't agree the pay gap is disgraceful. It's not even the rich anymore, they're suffering like the rest, it's just that top 1% super rich who are getting all of the money.

    The problem comes in how you deal with them. Taxing them won't work since none of them are domiciled here or have fiddled the system to avoid taxes.

    We don't want to tax the rich, they're the ones that will pull us out of this problem, we want to give the rich tax breaks to encourage them to invest in what we need. HOWEVER, that doesn't mean we shouldn't do something to take money from the super rich, but I'm just not sure how we do that.

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  • McMadman

    Evan Owen | 29/11/2011 9:17 am

    We can't afford public sector pensions!!!

    Evan - yes we can. Many of them are way, way in surplus. The Local Government Scheme for example is some £2bn in surplus and is not the only public sector scheme which has huge surpluses.

    There is, consequently, no need to have an increase on either employer or employee contributions to these schemes. Everyone knows the increases in pension charges proposed are nothing to do with longevity or unaffordability issues and all to do with paying the deficit down - because none of the extra income will go to these funds.

    2 final points.

    First, these surpluses are used to increase investment return. Quite often by investing in private sector firms, therefore sustaining their employment levels during recessions. See ? The public sector supports the private sectror and vice versa.

    Second, exactly what proportion of the country voted for the ConDem coalition ? Precisely Zero Percent. Even in the alternative, if you will, what proportion of the total electorate voted for tories or their liberal lapdogs ? Nowhere near a majority of electors.

    Governments of all colours for decades have been elected on well under 50% of electors eligible to vote. If that is democracy, then so are the union vote amounts.

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  • F451

    Ok Alpha - if those with the public sector pensions should accept their pension coming in line with yours - will you accept your pension coming into line with the majority.

    20 Million workers have no employer contribution to a pension - indeed many can not afford a pension. On your argument that we should all accept the poorest settlement surely your pension is too generous!

    You are spot on that it is about the pay divide - or more importantly that the majority do not get a fair representation of their worth whilst a small minority get the balance which is far in excess of their worth. After generations of paying them more of our income to incentivise them to invest a portion of their wealth they now possess more of the wealth than they started with - that is a problem with incentives.

    Taking from the super rich is simple - you need to tax everyone simply and fairly as the simpler the system the less loopholes will exist. So rather than paying a fortune to gain a pittance from the wealthiest you accept their wealth and tax their income in the same way as everyone else instead.

    One other reality to keep in mind towards a solution - poorer people allowed to have a higher income tend to spend more. Whilst their extra few pound spending each may be small, collectively it is what keeps business in business and can fund growth - if that growth is not simply in consumerist goods it may even be sustainable. So perhaps increasing the basic incomes of the poorest can be more beneficial to the economy than increasing the wealth of the richest and hoping they may use it to benefit the economy.

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  • Joe Halewood

    This discussion startedd with the assertion that "public sector pensions are unaffordable" which is the line adopted by the coalition government.

    Is that the case?

    An article by Anthony Hilton in the London Evening Standard 29 November 2011 makes interesting reading and the ES is not a place anyone would normally see an educated opinion that supports the view that this is a nonsense. It discusses the London Pension Fund or in simple terms all the public sector workers in the capital.

    "The average annual pension for members as a whole was £4140 -about £80 a week. Women's pensions are almost invariably much lower because they have worked fewer years, earned less or been part-time."

    So £80pw pension is unaffordable - there was me thinking it was a huge amount.

    The article goes on to say:

    "
    It has long been the case, for example, that the day-to-day cost of pensions in payment - those actually funded directly by the taxpayer - is less than the amount paid by the exchequer to individuals as tax relief on private-sector pension contributions. Massively less. In 2007-08, when public-sector pensions had a net cost to the taxpayer of £4 billion, private-sector pension relief cost the taxpayer £37.6 billion. Only in the past 12 months has this figure come closer to balance, with the introduction of a relatively low ceiling on how much relief individuals can claim."

    So, the £4bn cost of public pensions needs to be placed in context as the government pays £37.6bn or 9 times this amount in tax relief on private sector pensions. The article doesnt say or make clear whether the £37.6bn cost is for London alone and is a direct comprator or its the cost nationally.

    Yet in overview surely a pension of £4140 per year has to be affordable and this average includes all the top mandarins in the civil service in that average. £80pw pension is not excessive and is far lower than many would think - to say it is unaffordable for public servants is political spin of the highest magnitude.

    However I wonder if the above figures are correct why unions and/or Labour Party has not mentioned them?

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  • Daedalus

    Alpha One,

    You typed in a long posting (10:09), but as you got the first sentence wrong, most of what follows is based on a fallacy.

    There isn't a public sector pension SCHEME, there are pension SCHEMES. Only one letter different, but it invalidates all of your maths. Some of the schemes are perfectly viable and some are not. Why try to stupidly address themn all in one go. That is like trying to negotiate a cost of living increase (stop laughing at the back!) for every worker in the country at the same time - it can't be done. Each scheme must be addressed on its individual merits.

    Some of the schemes had their contribution rates increased three years ago to allow for the increased average lifespan of the members, and are now completely viable for many years to come. Some of these schemes do not receive any government money, and any increased contributions will be syphoned off by government to help to address the massive budget deficits.

    Got it now Alpha?

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  • F451

    Joe - to add to your data, which is an excellent slant to the debate - and indeed the nub of it, I believe you will find that the tax subsidy to private pension funds covers they under 4 Million private sector workers subscribing and those among the self employed who have independent schemes. The government contribution to the public sector pensions cover the over 5 Million public sector pension contributers.

    So the vastly lower sum covers considerably more pensions.

    And all because at some point we decided that the State Pension should no longer offer a reasonable standard of living to anyone (can anyone remember when this short term cut was made that is costing so many billions in subsidising private pension funds now?)

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  • Alpha One

    Daedalus, you are quite simple really aren't you, scheme or schemes the situation is absolutely the same and EVERYTHING I stated remains true.

    The public sector seem incapable of realising that they have a finitie pension pot, if that is to stretch further you either need to put more in, claim it later or reduce the number of people claiming from it. The private sector, reluctantly, accepted this 10+ years ago.

    It's simple maths Daedalus, let's bring it down to numbers we can all understand. If you have 5 people in a round of drinks, and everyone puts in £5, you get £25. You go into a pub and buy 5 drinks at £5 a pop, your kitty has maxed out but you had enough money to pay the bar bill.

    Now everyone chips in £5 again, but this time 5 more people arrive, giving you 10 people. Drinks are still £5 each and you only have £25 in the pot, how do you buy 10 £5 drinks with £25?

    That's the simplicity of it. You have a finite amount of money that you are expecting to stretch further for longer without putting in any extra money OR starting claiming the money later.

    It doesn't matter how cash rich those pension pots are now, how much the surplus is now, it cannot support the future retirements which WILL happen.

    F451, as I don't have a pension at the moment, I wouldn't be happy for everyone to drop to my level, as we'd all be poor! However, I'm not suggesting everyone should get the worst deal they can, I'm arguing that the public sector needs to wake up and realise their schemes (see Daedalus I got it right this time!) are not sustainable on current contribution levels.

    I'm also sceptical about your simpler taxation system getting to the non-doms, the very fact they don't live here would make it hard to tax them. Afterall its the non doms that tend to be the super rich. I do agree we need a simpler taxation system, I'm just not sure that it will be able to capture the non-doms in quite the way you think it will. The only way that could happen is iff we offered a taxation system that meant they paid less in tax by being domiciled than by not being.

    I agree that tax breaks at the bottom will help boost the economy, just look at the number of plasma screens people on low incomes have!

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  • F451

    If they are not earning here Alpha we wouldn't tax them - the point is that at the moment even those earning here don't get taxed - even when they then pay for the Tory election campaign and get a Lordship in return.

    You say that the pension schemes are not sustainable as they are - why not?

    If it remains possible for the government to pay vast sums into private pension schemes it surely remains possible for them to fund their own schemes.

    If it is the age dynamic, then that has already been dealt with by raising the retirement age, hasn't it?

    If they wish to state that the real reason is that someone has cleared off with the pot due to a mess up in the market place then that is a different matter - but that has never been put forward as a reason.

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  • & at the end of all this, what has been achieved?

    Some public sector workers have lost a day's pay: many private sector workers have lost a day's pay having to stay at home to look after children whose schools have closed; many thousands have had non-emergency health care treatment cancelled; a lot of teachers have been able to get their Christmas shopping done without needing to organise a training day this year; and where are we now?

    Exactly where everyone started. And we wonder why we're in the sh!t

    Out, out, brief candle!
    Life's but a walking shadow, a poor player,
    That struts and frets his hour upon the stage,
    And then is heard no more. It is a tale
    Told by an idiot, full of sound and fury,
    Signifying nothing

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  • F451

    What has been achieved?

    Well, there has been much debate in many quarters, and it would appear that generally people are now aware that 'gold platted' is a demonisers term and that public sector pensions are of modest value and considerably contributed to. People are also aware that public sector pay is low. And people may be beginning to understand that the private public argument is simply a screen to avoid the real transgressors, the over paid bosses and the government from being seen to be the lying manipulating theiving cheating scoundrals that they are.

    Maybe, the next protest might just be to redress that situation.

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  • May be time to get Housing Association staff delinked from the local authorities in terms of conditions of employment - they should be in the private sector - managing housing stock no big deal.

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  • Alpha One, I'm afraid you are quite wrong in your suppositions.

    There are many schemes available in various sections of the public secotr, and they have different rules.

    Some, like most NHS and teachers' schemes, are unfunded, which means they are paid out of general taxation. Because of the rise in NHS staff in the past few years, contributions to this scheme have actually created a surplus for a numebr of years, creating an income for the Treasury. Job cuts are now reducing the number of contributions sharply, which is creating a deficit, which is why the Treasury is having to pay out.

    Some, like Local Government schemes, are funded through investments in the private sector. Recently, like most investment funds, these investments have lost some value, and there is a growing gap between assets and liabilities.

    You then have differences in the age when these pensions are given, from as early as 40 in the armed forces, to 55 in most armed forces and police, and to 65 in most Local Government and NHS schemes (in some NSH schemes, there is a cut off date for when you're eligible for pension at 60, depending when you joined).

    Employee contributions range from 1.5% in smoe Civil Service schemes, to as much as 12% and more in soem Local Government and Police schemes (there may be others I'm not aware of).

    Employer contribution is also vastly different between schemes.

    The various "gilt edged" pensions that you see reported tend add up together the overall deficits and contributions for all public sector, ignoring assets, ignoring the different levels of contributions, ignoring whether any deficits are payable by the Treasury or not, etc.

    The biggest problem of course is that reports tend to compare the 3m on public sector pensions against the 1m+ of people in public sector pension, and comparing the deficits. It's like comparing Britain's economy with that of Ireland, they are different sizes.

    The truth of the matter is that while contributions were adding to the economy, this was not a problem, and it's only become one in the last 4 years or so. The impact on deficits will be mostly felt if job cuts continue as they are in the public sector, and if changes are not made to the way funds are managed. This means the Government can, and should, introduce measures to reduce deficits, but they should not be looking at making drastic cuts across the board and demonising public sector staff at the same time, it's not necessary.

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  • Daedalus

    Derren Cooper, you are 100% correct. However, it is pointless addressing your post to Alpha One, who is unable or unwilling to understand this simple point.

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  • Paul Burnham

    As a council tenant in high rise, I was very pleased to pitch at the rally outside the Civic Centre, somewhere in England, on Wednesday last to meet and greet my housing officer and her convenor, and to be advised that "No services are being delivered today". Tenants and housing workers unite, and together let's kick out the Tories!

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