And another one....

W1

walkingbootweather wrote:

W1 wrote:

Again, there is plenty of evidence that public sector workers earn more than private sector workers - so let's stop pedalling this notion that working in the public sector is some kind of "public service" sacrifice. That may be true for some, but I seriously doubt it's true for the gravy-trainers.

Sorry W1 I just don't buy this. The range of salaries in the private sector is undeniable greater with senior managers earning £millions per year, and there are companies where staff are exploited and paid less than the minimum wage. Few top public servants earn more than about £200,000, with an average salary nearer £20,000. The fact that those nearer the bottom earn a living wage, and the fact that the differential between top and bottom in the public sector is much lower than the private sector are in my view something to be applauded.

I'm sure the "range" is greater in the private sector - but it's not true to say that comparable "average" public sector workers earn less than their contemporaries in the private sector. It's not a "point" the public sector can just presume as part of their arguments for demanding greater pensions than the private sector.

bigmat

I think I have a solution - anyone seen "logan's Run"? How about we just limit it to public sector employees? They can then keep their pensions with bells on...

jedster

I find it fascinating but also frustrating how most people haven't understood a few basic points about the financial crisis, the recession and our painful recovery. To be fair, the media and the politicians have not done a great job of explaining this.

1. if you want to blame "bankers" for the recession you need to "blame" them for the good times in 2004-2007 too.

The developed world (and Britain in particular) thought we werericher that we really were. Our economy was turbo charged by borrowing and the spending, wages and profits that came from this turbocharging generated big tax receipts which government spent on public sector pay rises and investment in schools, hospitals etc. Actually, government got in on the act and borrowed even more assuming that this turbocharging would last for ever. It could only go on forever if debt levels could continue to increase but at some point that had to stop.

When reality dawned that this could not go on, the economy slumped but the key point is that it's not just that we are poorer now, in reality, we were never as rich as we thought we were in 2007, a lot of this was an illusion.

2. We never could afford to pay ourselves what we did in 2007

See above. In general, the private sector has adjusted to this pretty quickly. In 2009, many people took pay cuts or unpaid holidays to protect jobs. The public sector is yet to do this - there have been pay freezes but this does nothing to address the fact that we can't afford the current pay bill.

3. Some bankers made some horrible decisions which contributed to the boom and the bust. Some of this was incompetence and some of it was conscious risk taking on the heads I win lots / tails I lose a bit and others lose too basis. Bad stuff. But not all bankers and certainly not all branches of financial services were guilty of this.

4. Lots of other people share some blame - central bankers (Greenspan, King, etc - interest rates were too low for too long), politicians (borrowing in a boom), regulators (asleep at the wheel), voters (voting for borrowing and short-term goodies rather than delayed gratification), consumers (maxing the credit card to buy stuff they couldn't afford and didnt need to keep up with the neighbours). It's complicated.

5. The changes to public sector pensions are best seen as a pay cut. The public sector pay bill (salary, pensions, other benefits) was created in the fantasy good times. As private sector pay (salary, pension, bonuses, other benefits) has adjusted the public sector terms and conditions are uncompetitive and unaffordable. The government has concluded that it is better to address this through pension changes than salary cuts (just imagine the squeals!)

None of this is nice. But it is what it is. It's necessary and unavoidable. Ranting about bankers (however guilty some of them are) is not going to alter that.

Incidently, someone asked what financial services were doing to shoulder the burden of recovery. I'll give you a personal example. I work in FS although I'm not a banker, I don't lend money, I try to invest people's retirement savings so that they will support them in the future. My pay fell 25% in 2008. It has not recovered. Despite this, my tax bill is substantially higher now than it was in 2007. Net my family is down more than 35% take-home pay. I'm not asking for sympathy. I'd just point out that I didn't cause the boom or the bust any more than a teacher or a nurse did and I've been making a chunky contribution to the recovery since 2008.

Unfortunately the public sector is going to have to join in too - better late than never.
You can't blame unions for fighting for their members interests at the cost of what is good for the country - that is their job. Doesn't mean it would be right for them to win.

waddlie

I work in the Public Sector and will be scabbing my way to work tomorrow.

It doesn't matter whose fault this is. We have no money anymore.

The government's worst offer was still far better than the pension provision I had when I worked in the Private Sector.

walkingbootweather

I’ve got a good friend that used to be in the Pension industry, let’s call him Mike. He left college in about 1990 and within 10 years he was earning near £100K. As far as I could tell his job comprised mainly of advising businesses on how to avoid paying tax, and he might recommend one of a number of ‘investment vehicles’. Of course he could make no guarantee on how each might perform, but he got paid handsomely even if the selected investment turned out to be a dog. He’s left the industry now but made enough in 10 years to buy himself a nice little hotel in the country which he now runs with his wife. If he was still in pensions and his salary had dropped by 50% he would still be keeping the wolf from the door.

Compare that to Jill. Jill left school at 16 to become a care assistant. After 20 years she still only earns £15k per year for a 40 hour week. Her job is to wash and dress elderly people, to undertake some domestic chores and to give them a bit of human companionship. Her pay has remained fixed for the past 2 years and will be for the foreseeable future, yet inflation and energy bills in particular make it feel like a big drop. As things stand, if she continues to work until she is 65 she will get a pension of less than £8k pa. The Government proposals are that Jill should make a bigger contribution towards her pension (maybe £500 or more per year), that she should work until she is 67 or 68 and that she should get a lower pension when she does take it.

Perhaps someone with a better understanding of the basic points about the financial crisis, the recession and our painful recovery can explain to Jill that she needs to switch her heating off, while the Mike’s of this world make do with a 3 year old car rather than a new one.

All in it together – my ars*

jedster

"As things stand, if she continues to work until she is 65 she will get a pension of less than £8k pa."

Which , as I'm sure you know, is more than double the average private sector pension.

And what has Jill's story got to do with the sitaution of Head Teachers, etc who are also striking?

To be clear - I've been hit 35% and Jill is facing a hit of 3%. I take your point that some people can afford more than others. I'm not saying we should give up the same share but I reckon the 11:1 ratio is a pretty decent contribution to
fairness.

lost_in_thought

mickbrown wrote:

dhope wrote:

mickbrown wrote:

Average prole.......?

I do hope that was typed with tongue firmly in cheek.

I know LiT doesn't post much but you could probably find an example or two to realise it was.

I could, but I'm a lazy public sector worker and the loafer in me realised it was much easy to ask the question.

I kind of want to say 'no I meant it' to see the reaction from the foamers...

meanredspider

walkingbootweather wrote:

All in it together – my ars*

You're making the fundamental mistake of comparing general "wealth" issues with the effects of the current crisis. In many ways, the current financial crisis will have hit the "wealthy" relatively harder than those on minimum wage as the value of their various investments are likely to have been dramatically hit. I know that in absolute terms, your mythical care worker will be harder up but that was a problem long before all of this crisis struck. Your pensions friend was contributing tax & NI that paid for the care worker too - he's no longer contributing as much - there's not the money left in the pot to pay as much for public sector workers.

What would you like to see done differently to square this crisis? I think we'd all like to see those in the "caring" vocations adequately rewarded for a good job - the issue is we can't afford it at the moment - because we are All* in this together. Without the "wealth creators", there's no money to pay the care workers.

* =99% if it makes you feel happier

W1

walkingbootweather wrote:

All in it together – my ars*

"Walking boot weather in life isn't "fair" and never will be shocker".

Why didn't Jill go into pensions herself then?

rick_chasey

Anyone seen the budget?

Seems alright if you've got a few million burning holes in your back pocket.

Less good if you're poor.

walkingbootweather

W1 wrote:

"Walking boot weather in life isn't "fair" and never will be shocker".

W1 wrote:

Why didn't Jill go into pensions herself then?

Good question. Maybe she thought she might help others. What a fool eh?

notsoblue

W1 wrote:

Why didn't Jill go into pensions herself then?

What would happen if everyone went into pensions?

walkingbootweather

notsoblue wrote:

What would happen if everyone went into pensions?

Why surely we'd all have great pensions. After all these are mythical wealth creators, they can magic up wealth out of thin air.

rick_chasey

Bloke in the office just mentioned that it's soon going to be compulsory to have a private pension (possibly if you're private sector).

Anyone else hear this?

rick_chasey

Seems unlikely the protests will be cancelled given that public sector pay freeze continues, and will be followed by a 1% ceiling increase per year afterwards.

Seems the gov't isn't too interested in conceding much to them.

notsoblue

walkingbootweather wrote:

notsoblue wrote:

What would happen if everyone went into pensions?

Why surely we'd all have great pensions. After all these are mythical wealth creators, they can magic up wealth out of thin air.

Well some people do magic wealth up out of thin air. More power to them. But what some on this thread seem to ignore is that there will always be people on low wages, and/or doing unskilled work. The entire population can't be aspirational middle class. The standard response of "If you can't afford to live the way you are now, work harder/educate yourself/etc and get a better job" just isn't applicable to millions of people in this country.

W1

notsoblue wrote:

walkingbootweather wrote:

notsoblue wrote:

What would happen if everyone went into pensions?

Why surely we'd all have great pensions. After all these are mythical wealth creators, they can magic up wealth out of thin air.

Well some people do magic wealth up out of thin air. More power to them. But what some on this thread seem to ignore is that there will always be people on low wages, and/or doing unskilled work. The entire population can't be aspirational middle class. The standard response of "If you can't afford to live the way you are now, work harder/educate yourself/etc and get a better job" just isn't applicable to millions of people in this country.

And you'd like everyone who earns more than average to be taxed to oblivion, with the money given to those who earn less, so that life is suddenly "fair"?

Should we all drive the same cars, live in the same houses, do the same jobs and earn the same money? Is that what you ultimately want?

W1

notsoblue wrote:

W1 wrote:

Why didn't Jill go into pensions herself then?

What would happen if everyone went into pensions?

What would happen if everyone went into nursing?

W1

Rick Chasey wrote:

Seems unlikely the protests will be cancelled given that public sector pay freeze continues, and will be followed by a 1% ceiling increase per year afterwards.

So like the private sector then. Why should the private sector fund wage increases for the public sector when they're not getting wage increases themselves?

W1

Rick Chasey wrote:

Anyone seen the budget?

Seems alright if you've got a few million burning holes in your back pocket.

Less good if you're poor.

Are you joking? Inflation-rate rises for benefits - and the people earning the money to pay the benefits get frozen wages? Sounds like if you're on benefits, you're doing better than workers in both the private and public sectors.

rick_chasey

W1 wrote:

Rick Chasey wrote:

Seems unlikely the protests will be cancelled given that public sector pay freeze continues, and will be followed by a 1% ceiling increase per year afterwards.

So like the private sector then. Why should the private sector fund wage increases for the public sector when they're not getting wage increases themselves?

Macro-economic fail.

W1

walkingbootweather wrote:

Why didn't Jill go into pensions herself then?

Good question. Maybe she thought she might help others. What a fool eh?[/quote]

If that's what she wants to do, she's not a fool - but if she wanted to earn big bucks (which I presume is why you used her as a comparator) then she went into the wrong profession.

rick_chasey

W1 wrote:

Rick Chasey wrote:

Anyone seen the budget?

Seems alright if you've got a few million burning holes in your back pocket.

Less good if you're poor.

Are you joking? Inflation-rate rises for benefits - and the people earning the money to pay the benefits get frozen wages? Sounds like if you're on benefits, you're doing better than workers in both the private and public sectors.

That's standard - barely should be mentioned in the budget.

It was more the stimulation that was being offered was all for investors and new start ups. Tax breaks if you invest your cash in new firms etc.

The tax credits were freezed if I remember rightly?

I'd rather see an increase in the tax-free allowance...

W1

Rick Chasey wrote:

W1 wrote:

Rick Chasey wrote:

Seems unlikely the protests will be cancelled given that public sector pay freeze continues, and will be followed by a 1% ceiling increase per year afterwards.

So like the private sector then. Why should the private sector fund wage increases for the public sector when they're not getting wage increases themselves?

Macro-economic fail.

Care to explain?

W1

Rick Chasey wrote:

W1 wrote:

Rick Chasey wrote:

Anyone seen the budget?

Seems alright if you've got a few million burning holes in your back pocket.

Less good if you're poor.

Are you joking? Inflation-rate rises for benefits - and the people earning the money to pay the benefits get frozen wages? Sounds like if you're on benefits, you're doing better than workers in both the private and public sectors.

That's standard - barely should be mentioned in the budget.

It was more the stimulation that was being offered was all for investors and new start ups. Tax breaks if you invest your cash in new firms etc.

The tax credits were freezed if I remember rightly?

I'd rather see an increase in the tax-free allowance...

Why shouldn't it be mentioned? Why should it be standard? It certainly represents a good deal for your precious "poor", contrary to your blinkered view.

What is wrong with encouraging business and start-ups? That is what will bring the economony back to speed, not gifting yet more money to those who don't contribute at the expense of those who do.

Talk about macro-economic fail Rick - this is exactly what is required.

rick_chasey

W1 wrote:

Rick Chasey wrote:

W1 wrote:

Rick Chasey wrote:

Seems unlikely the protests will be cancelled given that public sector pay freeze continues, and will be followed by a 1% ceiling increase per year afterwards.

So like the private sector then. Why should the private sector fund wage increases for the public sector when they're not getting wage increases themselves?

Macro-economic fail.

Care to explain?

The private sector does not 'fund' the public sector.

The only difference is how they're paid for. In private sector, you've decided to spend your cash on it. In public sector, the gov't has decided to commandeer part of your cash and spend it for you.

It's not a zeo-sum game like that.

Similarly, if the gov't decided to spend LOADS of money, the private sector would also benefit (well, the entire economy would!)

walkingbootweather

W1 wrote:

walkingbootweather wrote:

W1 wrote:

Why didn't Jill go into pensions herself then?

Good question. Maybe she thought she might help others. What a fool eh?

If that's what she wants to do, she's not a fool - but if she wanted to earn big bucks (which I presume is why you used her as a comparator) then she went into the wrong profession.

No, you are right, looking after others is a luxury we can't afford. Looking after No 1 - that's where it's at.

I shall be sure to encourage my kids into well paid careers. My last hope is that they become super rich and can pay for my care in dotage- doesn't look as if the state will be able to help. Me and my mate W1 will be alright. The rest of you – you’re on your own. Losers.

rick_chasey

W1 wrote:

Rick Chasey wrote:

W1 wrote:

Rick Chasey wrote:

Anyone seen the budget?

Seems alright if you've got a few million burning holes in your back pocket.

Less good if you're poor.

Are you joking? Inflation-rate rises for benefits - and the people earning the money to pay the benefits get frozen wages? Sounds like if you're on benefits, you're doing better than workers in both the private and public sectors.

That's standard - barely should be mentioned in the budget.

It was more the stimulation that was being offered was all for investors and new start ups. Tax breaks if you invest your cash in new firms etc.

The tax credits were freezed if I remember rightly?

I'd rather see an increase in the tax-free allowance...

Why shouldn't it be mentioned? Why should it be standard? It certainly represents a good deal for your precious "poor", contrary to your blinkered view.

What is wrong with encouraging business and start-ups? That is what will bring the economony back to speed, not gifting yet more money to those who don't contribute at the expense of those who do.

Talk about macro-economic fail Rick - this is exactly what is required.

It's pretty standard to increase social welfare by inflation. It's a massive deal that public sector aren't.

There's nothing wrong with encouraging start ups. Not at all.

But it's about priorities. If stimulus is going to be used, as it rightly should be (given super low gilt yields), it should go to where it's going to count, politically and economically.

flimflam_machine

SimonAH wrote:

Flimflam, some good points. Where do we find this cash however? ... I'm running short of ideas.

Hey, I know what, let's go after big, global, mobile business and tax the sh1t out of them to pay for it all. Ah, forgot the mobile aspect I guess.

Well some socialist lunatics have suggested that we actually go after the tax that is already owed by some big companies, but that seems a bit too obvious. Business is indeed mobile and generally more resilient than the PubS, I doubt that they'd all move away permenantly and would rapidly return in economically more favourable times. In contrast, I think that the PubS would take much longer to recover any sense of quality and efficiency if it were decimated by cuts, since it is by its nature longer-term than the private sector.

W1 wrote:

When would you seek to make necessary reforms to pensions if not during times of economic downturn?

This problem has been known about for ages - it's simply that labour (in their wisdom) were not prepared to deal with it whilst they were splurging money during the good times. It's not that no-one noticed - it's that no-one had the balls to deal with it.

That may well be true. But it seems potentially equally damaging to have PubS pay reviewed by a government that has (in the Tories at least) a idealogical bias against the PubS, right at the point when the economy is dramatically bottoming-out (potential double-dip notwithstanding).

Again, there is plenty of evidence that public sector workers earn more than private sector workers - so let's stop pedalling this notion that working in the public sector is some kind of "public service" sacrifice.That may be true for some, but I seriously doubt it's true for the gravy-trainers.

But there is a sacrifice. Take me for example, I went through several extra years training on a modest stipend to go into a reasonably paid job (with sod all job security I would add) that, if I make it to the top through the considerable competition, would give me a ultimately a decent but unspectacular salary. Some of my contemporaries who went straight into the financial sector are, at an estimate, earning 2 to 3 times what I do. A few will be earning a great deal more and they were all earning while I was doing the extra years' training. If I had taken that path I could have taken a 50% salary cut and still have been in a better financial situation than I am now. What you are sacrificing is the opportunity of making the really big bucks. Everyone keeps going on about the "gravy-trainers" and "featherbedding" with no explanation of how these cuts would make that problem better rather than worse.

This is all in addition to the question of how much we value our PubS. We seem to be stuck between a rock and a hard place. We can't afford PubS pensions, but neither can we afford to have an unhealthy, poorly-educated, badly regulated population. The idea that the PubS doesn't create (or at least maintain) wealth for the nation seems bizarre to me. The people who are complaining about PubS pensions would, I suspect, be equally vocal when their bin collections become less frequent or hospital care standards drop.

W1

walkingbootweather wrote:

W1 wrote:

walkingbootweather wrote:

W1 wrote:

Why didn't Jill go into pensions herself then?

Good question. Maybe she thought she might help others. What a fool eh?

If that's what she wants to do, she's not a fool - but if she wanted to earn big bucks (which I presume is why you used her as a comparator) then she went into the wrong profession.

No, you are right, looking after others is a luxury we can't afford. Looking after No 1 - that's where it's at.

I shall be sure to encourage my kids into well paid careers. My last hope is that they become super rich and can pay for my care in dotage- doesn't look as if the state will be able to help. Me and my mate W1 will be alright. The rest of you – you’re on your own. Losers.

That's a choice your kids are free to make, isn't it? Complaining about it (when compared to someone who works in pensions) is daft. If someone wants to earn money, going into nursing isn't the way to do it. If you want to go into nursing, working in pensions probably isn't the right thing either. See how silly that sounds?