Strands #248 “Strumming Right...
Quizzes & Puzzles7 mins ago
Public Sector Pensions
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Saw in the papers that on average we are all paying (shock horror) �300 a year for public sector pensions.
What's all the fuss about...if you spend any money in the country you're contributing to somebodys pension.
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I'm a bit lost by the question to be honest. The fuss is about the fact that we don't have enough money to pay for pensions because people are living longer. As far as I remember for C4 7pm news the other night, the public sector have managed to secure a retirement age of 65 for any 21 year old joining next year (or something like that) and Digby Jones feels this isn't fair as private sector workers are going to have to work longer.
My thoughts are this: given that the average person who goes to uni graduates at 22, and now can expect to live to over 80 ( here ) retiring at 60 or 65 seems totally unrealistic. It means that people will spend about 40 years out of 80 working, and the others claiming off the state (or their parents in the first 20). Many sensible people will save their own pensions, but not everyone can afford it, and with the current craze for consumer credit, many people will live their life in the red so much that they can't save either.
Allowing women to retire earlier is crazy too when they do less physically demanding jobs and will outlive the men, thus draining even more money from the state. If we want equality (which I believe most women do) then we should have equality, not special treatment, when it comes to things where there need be no difference in treatment.
My parents (born in the 1950s) were only expected to live to be 70 odd, therefore affording them 10 years of retirement seems fair. That means that we (those born in the 70s and 80s) should be expecting to work until we're 70, to have the same length retirement.
ctd...
ctd...
Why people think it is unreasonable to have us work longer, when we are generally healthier, have a more comfortable life, stay healthy for longer, and actually live longer, is beyond me. Moreover, people born in the 1970s and 1980s are far more likely to go to uni than those born in the 1940s and 1950s, thus they spend perhaps 3-5 years less contributing to the economy.
I think the key thing today, is that people need to think about their own pensions. Assume that the state won't provide for you, and stop burning out credit cards in order to have flashier electricals than the Joneses, and save some money to last you in your old age... OR, expect to work for longer.
Here endeth the rant, now I'm off to London for the day.
People have money removed from their salary on the basis of being paid a state pension from aged 65 to death. It seems to me to be unfair in the extreme to suddenly say whoops sorry and move the goal posts. If you are going to change the age at which pension may be claimed, then it should be on the basis of new entrants to the work force. I am unclear on the issue over public/ private sector. We all pay in the same for a state pension. The additional pension that public sector workers can have is funded partly by their contribution, and partly by the employer, the same as any other employer pension scheme and as such is part of the entire salary leave etc benefits package which attaches to the job. If the employer is a private sector organisation, then it prices its goods in such a way that it can afford to meet its pension commitments.
PS while I am a public sector employee, none of this applies to me as I have not opted in to the pension scheme. I expect to be competeting paid employment way before 65 (because the MR and I have planned and saved for it) We will be collecting our pensions at age 65 because we have paid into the national scheme on that basis without a choice to opt out. Any government who trys to move the goal posts on that one will think that the winter of discontent was a weekend in Acapulco by contrast!!
Woofgang - I quite agree! I just didn't say that before becuase I felt I'd waffled long enough already! I think perhaps for people aged 30-40 they could make it 67 say, and then people under 30 should all go to work on the basis that they won't get a pension til they're 70. But shifting the goal posts for people in the latter half of their working life is unfair - I strongly agree with you there!
There appears to be a little confusion here over the public sector and state pension. The public sector pension issue is that currently any governement worker can retire from their work at 60 - and claim their 'company' pension (excluding armed forces/police - who can retire much earlier), they will not be able to claim their state pension at 60, so is not 'unfair' to private sector workers at all. The new legislation means that any new entrant in to public sector work will not be eligible for their work pension until 65. As woofgang has said we are all paying for some public sector wage/pension/service through taxes in some way or other. This has no bearing on the state pension issue.
State pension age is likely to increase - and is already doing so for women - in the same way you suggested January-Bug. I imagine that the goalposts will 'shift' a few times before I get around to retiring. This is simply because the population age is increasing, and more people than ever are eligible for a state pension, and claiming it for longer, than there are people providing the money - ie the workers. If the situation stays as it is, there just won't be the money in the bank to pay everyone for the full length of their retirement - unless the workers end up paying substantially more out of their current wage that they are doing now.
Haggisdj - there are different rules here. If you've never paid a single NI contribution, then no, you won't get a state pension. However, if you've signed-on all your life you will (your contributions are paid when claiming state benefits). Chances are you'll also be eligible for all the top-up benefits that come with a low income - housing benefit, council tax benefit, pension credit etc. It's not fair, but then there are some who genuinely can't work and should not be discrimiated against - ie carers, those with certain disabilities. But then some people would rather slate the public sector workers and deny them anything rather than looking at those who contribute nothing to our society, but get an awful lot for doing so. In my opinion of course.
JUST a point of interest about public sector pensions you could retire at 55. and get a fairly good pension and lump sum and according to what scale pay you were on, this was good and could get other part time work you still get you state pension if you paid full N I and this is graded also and have to pay it for I think 30yrs before getting the full pension. But what people don't realise is on public sector pensions a third is taken back each month in TAX. so its not so rosy as you would think I have not heard this published and when I tell people have to pay this Tax don't believe you. paid for this pension each month for 40 yrs as well as NI stamp and would like to know how many people have lived to receive a pension the same length of time they paid for it, especially way we are ripped out in this country by Tax on everything.if people lived 20 years on a pension the govt would still be quids in for what people had paid.
Hang on a minute!! I realise my answers may have looked muddled and thus implied otherwise, but I DO understand the difference between public sector, and state pension.
I'm afraid I DO believe that having the public sector pension age as earlier than the private sector can afford to be unfair. As the biggest employer in the country, the government sets a precedent. But here it is abusing its position as controller of tax income to bow to union pressue and use taxes to pay for people in the public sector to retire early (relative), when it is known that the private sector (especially in retail) cannot afford to do this. I appreciate that public sector unions are stronger than private sector ones in some ways, but this should not mean that people get to leave work earlier just because they work in the public sector. The myths about everyone being paid more in the private sector are simply not true, so this is no justification either.
I apologise if these ideas are in anyway is presented poorly. I'm very VERY tired, but I wanted to attempt to make this point before going to bed!
Between us, myself and Mr.S. have 75 years of working life behind us.In the private sector. We chose to take early retirement,myself through ill health. Mr.S.because he could see the way things were going with company pensions.Between us we have managed to buy our own house,provide for our children,pay into our own private pension plan ,pay for our own private medical insurance,feed the exchequer and contribute to the NI .When we receive our state pensions I have no qualms whatsoever about taking it.We have worked to provide for our parents generation and it is now up to our children to provide for the next generation or at least to provide for themselves. We pay tax on our private pension and our company pension,we do not scrounge off the state.It is time for people to wake up and realise that there is no no such thing as a free lunch.There will be always
be the have and have nots in society.But..if you want to get anywhere in life you have to work for it.Fair enough MR.S could have found other employment between taking early retirement and reaching the age of 65 but after 45 years of being a wage slave I think he is entitled to put his feet up.After all said and done he has earned it.Why should people be wage slaves until they are 70.There are more things in life than work.And I think that once you have done your fair share and made your contributions to society you should be allowed a little Rand R.After all one is a long time dead.
be the have and have nots in society.But..if you want to get anywhere in life you have to work for it.Fair enough MR.S could have found other employment between taking early retirement and reaching the age of 65 but after 45 years of being a wage slave I think he is entitled to put his feet up.After all said and done he has earned it.Why should people be wage slaves until they are 70.There are more things in life than work.And I think that once you have done your fair share and made your contributions to society you should be allowed a little Rand R.After all one is a long time dead.
Who was that directed at?
Not me I hope - I've tried only to agree with you.
Perhaps I need to clarify again... people currently in work and over 40 should, in my opinion be able to retire when they expected. People under 40 should be asked to work a little longer. Those, like me, just starting out, should be required to work til they are 70.
Whether people have saved privately or not, claiming a state pension (whether well earned or not, and whether paid for or not) IS a drain on state resources. I think people are entitled to money from the state, yes of course! But the bottom line is that we, as a country, cannot afford to keep on this way! So fair or not, we are going to be ecnomically screwed if something doesn't change!
We must accept either higher taxes now, or lower pensions, or a later pensionable age later. There are two reasons for this, one is not our fault, the other is: people are living longer and saving less.
No longer can we have our cake and eat it!
Yes I'm sure tax we pay goes on all sorts of things including the lay abouts who don't want to work rows of them who live here and have come here sitting in the city centres and don't forget we paid tax on what we put into pension as shanneystar has said and ripped off because been Prudent, and get no council tax benefit etc. also what about single supplement for holidays surely a discrimination Tax which for some holidays is hundreds of pounds.
The Times 21st oct states those who retire early died much earlier I agree work keeps you going and your status has gone after being in good positions. Good Luck to everyone for a happy wealthy retirement perhaps in never-never-land not here...
Jan bug you make good points and I know you enjoy a debate but although I shan't be around,I don't think I would fancy being treated by a 70 year doctor or nurse or get on a plane with a 70 year old pilot at the helm.And the idea of a 70 year old policeman is laughable.The people who will work until they are 70 will of course be those in lower paid and more menial jobs who cannot afford to buy private pensions.Company pensions these days are a dodgy issue.Remember the Daily Mirror pensioners? I do agree people will have to find a way to support themselves when they retire,but these will inevitably be the high earners who can afford to retire early.The government needs to think now on pension reform rather than later.And on that note I wish you a happy and healthy retirement when you reach that age and hope you will not be too burnt out to enjoy it !
Good point shaneystar - of course late retirement is not appropriate in all professions. Although I feel that at 70, a policeman may still make a valuable contribution to desk work and/or community support type roles. But yes, chasing villains up the street ... maybe not!
I still think that economically we just can't support people spending less than half of their lives working, without paying higher taxes. But then I'm just making the same point repeatedly which is hardly productive, so I'll stop! :-)
The point you make about policeman is quite true.My brother retired at 52 from the police force and then went on to work in the Legal Dept at County Hall until he was 63.He is now 70 and he was approached last year by the boys in blue wanting to know if he would be interested in cold case research.I have to say he did consider it but with his wife not being in the best of health turned it down.But I could see that he was itching to do it really !!
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