Albumen
Don't wait for me!
You are not in favour of public sector pensions, and you are a pensioner. I was merely asking whether your pension has worked for you.
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State Pension delay to age 70 for under 30's?
- Thread starter nicko31
- Start date
You are not in favour of public sector pensions, and you are a pensioner. I was merely asking whether your pension has worked for you.
Albumen
Don't wait for me!
Got a link to that stat?
Pete, bang the political drum, if you like, but the fact remains that this really isn't a party political argument.
Level heads from both sides of the political spectrum are rightly concerned about the cost of today's pensions and those of future generations.
Albumen
Don't wait for me!
A lot of the worry is because most the next generation haven't got a pension.
Anyone relying on a state pension is a fool. You need a private one, you need to start saving yesterday and you need to diversify.
I've taken paying into my private pension very seriously for a number of years now. Work match my contributions up to 3% which is something I suppose.
I've taken paying into my private pension very seriously for a number of years now. Work match my contributions up to 3% which is something I suppose.
beorhthelm
A. Virgo, Football Genius
- Jul 21, 2003
- 36,026
nothing directly. however, there is substantial costs on public service to funding public sector pensions, something that needs to be addressed for future pensions as the current arrangment is unsustainable.
nicko31
Well-known member
- Thread starter
- #48
http://www.ukpublicspending.co.uk/uk_total_spending_pie_chart
2017, 11% education, 20% pensions.
And go back 10 years and it was 13% on education, 17% on pensions.
Albumen, It is not a matter of being in favour of public sector pensions or not. I just happen to believe that they have got to be reformed and brought more in line with the arrangements that exist in the majority of cases in the private sector.
Yes, I am a pensioner and am in receipt of the state pension and a private pension.
I repeat, I do not believe the state pension triple lock guarantee of a minimum rise of 2.5% per annum is sustainable and should be abolished. If it is not, it will have severe consequences for future generations by further extending the date at which workers will qualify for a pension. Not good.
My private pension fund has been built up my contributions from myself and my past employers. It was invested( and as a SIPP, still is) in the stockmarket and thus subject to the vagaries of the world markets.
Has my pension worked for me, you ask.
Well, if the markets are doing ok, I am happier than if they are not, but I have to say, I do not have the security and inflation proofing pensions that both my sister and father enjoy as retired public sector workers......teacher and doctor respectively.
I am more fortunate than many, as I have a reasonable investment portfolio, but again the success or otherwise is largely subject is to the markets.
Us wicked Tories don't have it all our own way!
beorhthelm
A. Virgo, Football Genius
- Jul 21, 2003
- 36,026
the claim that Tory's say "public pensions should be reduced to private sector levels" is a myth to cut off the debate. there is an argument to reduce future pensions to a level that is affordable and protects funding for front-line services. otherwise we'll pay more and more into paying for the pensions, rather than the services of the day. many public sector pensions are unfunded, and most are under-funded relying on the government (or rather current budgets from our taxes) to make up the shortfall.
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Well, as my three offspring are concerned, the cost of housing .....renting or buying is higher up the list of priorities than a pension ,at the moment!
Poor buggers, it was a lot easier when I was their age.
Thunder Bolt
Silly old bat
I couldn't afford rent or a mortgage when I was young. I had to get married first so that we had two incomes, firstly to rent, and then to buy. Even then, our combined incomes didn't amount to a mortgage in the south east.
Well, as my three offspring are concerned, the cost of housing .....renting or buying is higher up the list of priorities than a pension ,at the moment!
Poor buggers, it was a lot easier when I was their age.
Albumen
Don't wait for me!
It'll be fine.
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I don't think all this private sector vs public sector stuff really gets to the heart of the issue.
For me the key points are:
1) state pension is not, and never will be sufficient, on its own to provide a decent standard of living for most people in their old age. Greater longevity and pressure on public finances for health and social care will just make that even less likely in the future. That doesn't mean it shouldn't be improved, simply that any feasible improvement is not likely to be enough.
2) that means that anyone who wants a decent standard of living in retirement will need to make other, additional provision, through a workplace/occupational pension and/or a stand-alone private provision.
3) the sums you need to save through either of these means in what will mainly be defined contribution pensions, given that (for the same reasons - greater longevity etc) defined benefit (final salary schemes), are increasingly disappearing under their huge deficits, are mind-boggling. Under reasonable assumptions you need to save something like 20% of your income throughout your working life starting from your twenties to stand a reasonable chance of retiring on something like half your average wage.
4) Many people don't really get their head around the sums until it's far too late, by which time the cost of making up the gap is even greater.
5) Even many bright young people who do understand the maths still don't do anything until it's too late, and for all sorts of familiar reasons value the money in their pocket today over what they will need in their old age. I despair at young colleagues, many with PhD's, who decide not to join our company pension scheme (which in these times is fairly generous - a multi-employer, career average, defined benefit scheme into which the employer pays 18% of salary, and the employee pays 8% and gets tax relief on that), because they 'can't afford' the 8%. They could never match a deal like that elsewhere, but they still don't do it.
6) Some people, of course, will be relying on inheriting property wealth before their retirement, but many would be unwise to do so.
7) For all these reasons if, as a society, we want to avoid a growing mass of elderly people living in poverty, the state needs to take a strong role. This is a classic case of where the state needs to intervene through a mixture of financial contribution and regulation, because the market won't provide adequately, because individuals are short-sighted and don't/can't understand what they need to do themselves, and because of the economies of scale the state can reap through the financial markets, which the individual can't. That means, in my view, a much stronger legal requirement for employers to provide occupational pensions and employees to contribute (the new compulsory workplace pensions are a start, but the minimum level is still far too small), coupled with more (not less) generous state pensions funded through an increase in general taxation. Something also needs to be done to improve the pensions situation of people who spend significant periods of their working lives in self-employment, as this is clearly a growing part of the workforce.
For me the key points are:
1) state pension is not, and never will be sufficient, on its own to provide a decent standard of living for most people in their old age. Greater longevity and pressure on public finances for health and social care will just make that even less likely in the future. That doesn't mean it shouldn't be improved, simply that any feasible improvement is not likely to be enough.
2) that means that anyone who wants a decent standard of living in retirement will need to make other, additional provision, through a workplace/occupational pension and/or a stand-alone private provision.
3) the sums you need to save through either of these means in what will mainly be defined contribution pensions, given that (for the same reasons - greater longevity etc) defined benefit (final salary schemes), are increasingly disappearing under their huge deficits, are mind-boggling. Under reasonable assumptions you need to save something like 20% of your income throughout your working life starting from your twenties to stand a reasonable chance of retiring on something like half your average wage.
4) Many people don't really get their head around the sums until it's far too late, by which time the cost of making up the gap is even greater.
5) Even many bright young people who do understand the maths still don't do anything until it's too late, and for all sorts of familiar reasons value the money in their pocket today over what they will need in their old age. I despair at young colleagues, many with PhD's, who decide not to join our company pension scheme (which in these times is fairly generous - a multi-employer, career average, defined benefit scheme into which the employer pays 18% of salary, and the employee pays 8% and gets tax relief on that), because they 'can't afford' the 8%. They could never match a deal like that elsewhere, but they still don't do it.
6) Some people, of course, will be relying on inheriting property wealth before their retirement, but many would be unwise to do so.
7) For all these reasons if, as a society, we want to avoid a growing mass of elderly people living in poverty, the state needs to take a strong role. This is a classic case of where the state needs to intervene through a mixture of financial contribution and regulation, because the market won't provide adequately, because individuals are short-sighted and don't/can't understand what they need to do themselves, and because of the economies of scale the state can reap through the financial markets, which the individual can't. That means, in my view, a much stronger legal requirement for employers to provide occupational pensions and employees to contribute (the new compulsory workplace pensions are a start, but the minimum level is still far too small), coupled with more (not less) generous state pensions funded through an increase in general taxation. Something also needs to be done to improve the pensions situation of people who spend significant periods of their working lives in self-employment, as this is clearly a growing part of the workforce.
I can't speak for all professions, but certainly in my line of work the wages seem to be broadly similar and my company contributes a massive 1% now (because they have to)... Not sure the public sector will exist much longer anyway. Two close relatives (one working for local government, one national) have both been transferred to a private company in the last year.
I deal with local authorities all the time and it's getting hard to even speak to anyone as they've laid off so many staff. I deal with Lewes DC a lot and they've gone from having a couple of environmental specialists for every topic (air quality, noise, contamination, etc.) to one or two people covering everything, in just a couple of years.
Lord Bracknell
On fire
I'll respond to your second point.
I was (am?) a member of the Local Government Pension Scheme. That was a contributory scheme that required both the employee and the employer to make contributions towards the cost of pensions. As an employee, I had no choice and I paid into the fund every month. But the employer (in my case East Sussex County Council) did have a choice. They were responsible for managing their particular bit of the fund (called the East Sussex Pension Fund). The way they did this was to employ investment advisors who were required only to ensure that there was enough money in the fund to pay out the short-term amounts that were needed to pay the current recipients of a pension.
What this meant, in practice, was that the employer was advised that there was no need to top up the fund with employer's contributions. In fact, not making those contributions could be a way of keeping council tax down. And that's what ESCC (and all other local government employers did). They called it "complying with the regulations".
Guess what? Over the years, it became obvious to everyone involved that, in the long term, this was an arrangement that wasn't sustainable. Despite pressure to make appropriate contributions, the employers effectively spent their money on other things. Not unlike Robert Maxwell, as it happens. But, unlike Maxwell, they got away with it.
Now we are told that the taxpayer can't afford to keep public sector pensions at their earlier level. So the party is over - and, astonishingly, everyone is blaming the employees.
All of this was avoidable, if the government (who made the regulations) had, in fact, required the employers actually to make their contributions to the pension fund.
GOM
living vicariously
Your public sector pension also has contributions made by your employer, the public sector, your portion of payments in is probably less than half of what goes into your public sector pension contributions.
General taxation is public funds.