Public sector pensions

rhext

philthy3 wrote:

Mis information by a government intent on fulfilling it's prophecies by any means other than curtailing their own wanton spending and lucrative pay and pensions. That and having to start paying back some of the PFI schemes that were supposed to help the public sector work more efficiently but have in fact landed them with huge debts while filling the pockets of the directors behind the PFI.

So they're just lying when the say the costs are increasing? It's OK, I believe you! Honest. Despite the fact that you're inviting me to believe that any shortfall could be made up by reducing the pay/pensions/expenses of 600 MPs most of whom already get paid less than (say) a GP!

daviesee

Rick Chasey wrote:

The baby boomers have lived a life of consistent prosperity which we now understand to be unsustainable. I don't think the generations after them are likely to be sympathetic enough to pay out of their own money, which goes much less far now than it did, for the boomers to continue that lifestyle.

I wish you would stop trying to perpetrate this myth.

The 70s were harder than now. The early 80s were no picnic and the early 90s weren't too nice either. I was made redundant 8 times during this so called "consistent prosperity". At one point I was also completely penniless and had to last 2 days with empty cupboards and no food until the next dole cheque came in and the cycle started again. I consider today to be easy sailing in comparison. I don't want sympathy, just an end to the myth.

rhext

daviesee wrote:

Rick Chasey wrote:

The baby boomers have lived a life of consistent prosperity which we now understand to be unsustainable. I don't think the generations after them are likely to be sympathetic enough to pay out of their own money, which goes much less far now than it did, for the boomers to continue that lifestyle.

I wish you would stop trying to perpetrate this myth.

The 70s were harder than now. The early 80s were no picnic and the early 90s weren't too nice either. I was made redundant 8 times during this so called "consistent prosperity". At one point I was also completely penniless and had to last 2 days with empty cupboards and no food until the next dole cheque came in and the cycle started again. I consider today to be easy sailing in comparison. I don't want sympathy, just an end to the myth.

Yes, but unfortunately you can't draw conclusions about population prosperity from individual circumstances.

Rick's point is that the current generation of 40-60 year-olds benefited from the opportunity of free university education, relatively low house-prices, and are expecting pensions the like of which the current generation of 0 to 20 year-olds can only dream of. And yet the current generation of 0 to 20 year olds are the very people who are going to have to pay for those pensions.......

daviesee

rhext wrote:

And yet the current generation of 0 to 20 year olds are the very people who are going to have to pay for those pensions.......

That's how pensions work. I take it you are against pensions in principle then?

I am as I have never entered into a company pension. I didn't see how it could be funded and foresaw pitfalls. Maybe I missed a glorious opertunity but I can't see these funds lasting another 20 years.

My personal experience is just an example. There are whole areas of this Country decimated in previous decades. The man in the street is only interested in feeding his family and Government figures and statistics are of no consequence.

rhext

daviesee wrote:

rhext wrote:

And yet the current generation of 0 to 20 year olds are the very people who are going to have to pay for those pensions.......

That's how pensions work. I take it you are against pensions in principle then?

I am as I have never entered into a company pension. I didn't see how it could be funded and foresaw pitfalls. Maybe I missed a glorious opertunity but I can't see these funds lasting another 20 years.

My personal experience is just an example. There are whole areas of this Country decimated in previous decades. The man in the street is only interested in feeding his family and Government figures and statistics are of no consequence.

No, I'm not against pensions in principle. I think pensions are great. I'm just agreeing with Rick that the 'baby-boomer' generation loading too much cost onto their kids might prove unsustainable. And yes, I know that growth and productivity improvements tend to take the sting out of things over time, but I still think it's a fine line.

GeorgeShaw

Rick Chasey wrote:

The baby boomers have lived a life of consistent prosperity which we now understand to be unsustainable. I don't think the generations after them are likely to be sympathetic enough to pay out of their own money, which goes much less far now than it did, for the boomers to continue that lifestyle.

The baby boomers have been paying taxes for 40-odd years, mostly at a higher rate than people are paying now ...

Blame Thatcher, who started the trend by p*ssing away our oil money on tax cuts, and her successors, who all seem to think that tax rates can only go downwards.

BTW, I read this morning that over the last 10 years productivity has been increasing at twice the rate of wage increases - this is the usual mechanism by which wages rise. This means that either you're being screwed by your boss (whose wages have gone up by more than that) or your SME is being screwed by the big companies (whose profits have gone up by a lot more than that). Big companies are sitting on massive amounts of cash right now.

bompington

Interesting to cross-reference the "baby-boomer vs generation Z (or whatever we're onto now)" debate here with the one about the 22 yo who's all disappointed that he can't hire a car like mummy and daddy's TVR.
No idea what that proves mind

andyrm

Pross wrote:

The company I work for are at the better end in terms of pay and conditions in our sector, we have lost a lot of benefits as we provide professional consultancy to the construction industry and so took a huge hit when the recessions started (about a third of our work was for the housing sector). Most of our comparable competitors made wholesale redundancies in addition to cutting wages and benefits so we got off relatively lightly by agreeing to a pay cut and reduction in other benefits combined with having directors that didn't want to take the easy option. We now have a healthy workload but due to supply and demand our fees are about 40% lower which means we sometimes have to work extra hours for no extra money to get jobs out and keep our clients. It's not a complaint as such as I realise we are governed by market forces and I've had it pretty good for a decade.

As with the public sector we were the victims of the recession that wasn't of our making but we had to take a pragmatic approach and accept that a cut in pay and benefits was preferable to having no job. That's not to say I agree that existing public sector employees should have pension cuts enforced on them but I do think a responsible employer should consult employees and Unions to give them the full picture and come up with ideas as the current system is unsustainable and options for those joining in the future need to be considered. Paying in 8% of a salary over 40 years just cannot provide 66% of a final salary for potentially the next 20 years or more even if invested in a high growth market.

I would love a final salary pension from my current employer but with the best will in the world a company that is just over a decade old, has 50 odd employees and a turnover of a few million a year with fairly small profit margins is unlikely to be in a position to provide one.

Exactly this - across the private sector, many of us who in no way caused the downturn have had to bite the bitter pill of pay cuts to ensure survival and viability, in direct change to our standard T&Cs of employment. I don't see any reason why anybody should think they are above this. The country is financially on the brink and it is rather arrogant for one sector to think they have a right to avoid the hardships the whole country is enduring.

rick_chasey

GeorgeShaw wrote:

Rick Chasey wrote:

The baby boomers have lived a life of consistent prosperity which we now understand to be unsustainable. I don't think the generations after them are likely to be sympathetic enough to pay out of their own money, which goes much less far now than it did, for the boomers to continue that lifestyle.

The baby boomers have been paying taxes for 40-odd years, mostly at a higher rate than people are paying now ...

Blame Thatcher, who started the trend by p*ssing away our oil money on tax cuts, and her successors, who all seem to think that tax rates can only go downwards.

BTW, I read this morning that over the last 10 years productivity has been increasing at twice the rate of wage increases - this is the usual mechanism by which wages rise. This means that either you're being screwed by your boss (whose wages have gone up by more than that) or your SME is being screwed by the big companies (whose profits have gone up by a lot more than that). Big companies are sitting on massive amounts of cash right now.

That stat doesn't take the spread of the productivity into consideration.

GeorgeShaw

Rick Chasey wrote:

That stat doesn't take the spread of the productivity into consideration.

That's true. It's more likely that productivity has risen in high tech for example, which has a comparatively small workforce, while productivity is more "traditional" industries is much harder to increase. Thanks for the correction.

Mind you, I'm in IT and have just had my first (sub-inflation-level) wage rise for 6 years.

snailracer

There is no pensions "black hole" as far as I am concerned - the monetary value of our pensions we will receive in future MAY simply be somewhat less than our current projections. However, in terms of the ability to meet our material needs, we will be richer in the future than the present or past, because, barring a repeat of the Dark Ages, technology advances to more easily meet our material needs.

For example, a pensioner in 2020 might be able to buy fewer cars per year than a pensioner in 2000, but that car will be a better car. Ditto with shelter - central heating, inside loos and double glazing: who in 1970 would have thought these luxuries would become "standard"? Ditto again with medicine - I remember when hip replacements were a fanciful idea on Tomorrow's World, now they are routine, and I expect more medical marvels to become commonplace and offset my decrepitude when I retire. Also, the real cost of food has, in the last 40 years or so, fallen by about two-thirds, despite an increase in the world population, due to mechanized farming and improved distribution. Increased "wealth" due to technological and scientific advances all have much more impact than a slight change in the slope of an economist's graph.

So, you're all moaning over nothing - IMO, the future is so spectacularly awesome I can't wait to get old(er). And my future granny-shopper bike will be made of some as-yet-undiscovered super-material, while carbon fibre will only be ridden by bearded retro-grouches.

fast as fupp

snailracer wrote:

There is no pensions "black hole" as far as I am concerned - the monetary value of our pensions we will receive in future MAY simply be somewhat less than our current projections. However, in terms of the ability to meet our material needs, we will be richer in the future than the present or past, because, barring a repeat of the Dark Ages, technology advances to more easily meet our material needs.

For example, a pensioner in 2020 might be able to buy fewer cars per year than a pensioner in 2000, but that car will be a better car. Ditto with shelter - central heating, inside loos and double glazing: who in 1970 would have thought these luxuries would become "standard"? Ditto again with medicine - I remember when hip replacements were a fanciful idea on Tomorrow's World, now they are routine, and I expect more medical marvels to become commonplace and offset my decrepitude when I retire. Also, the real cost of food has, in the last 40 years or so, fallen by about two-thirds, despite an increase in the world population, due to mechanized farming and improved distribution. Increased "wealth" due to technological and scientific advances all have much more impact than a slight change in the slope of an economist's graph.

So, you're all moaning over nothing - IMO, the future is so spectacularly awesome I can't wait to get old(er). And my future granny-shopper bike will be made of some as-yet-undiscovered super-material, while carbon fibre will only be ridden by bearded retro-grouches.

i'd like some of what youre on

snailracer

^^
PG Tips.