Who is paying for your pension ?

I paid for my own pension by working in the Civil Service for 37 years. (Note the emphasis)

If the private sector were too intent on pension "holidays" to fund speculative investments and paying obscene bonuses to people who are overpaid to start with, then screwing their rank and file workforce by saying "Oh sorry, we can't afford a decent pension scheme now. So hard cheese." I am not going to take any blame.

steve

Who is paying for my pension? I pay 7.3% of my salary. My employer pays 16.4%, plus more through a lump sum for the past service deficit. The employer's share comes from council tax, national taxation and the business rates. 

As to the question, 'who is living off your lost pension?' it's certainly not me. It's the shareholders, owners or partners, who are too greedy to ensure that their employees are supported in their later years, after a lifetime of service.

Public sector pensions should be emulated in the private sector. If older people had good pensions, they would not need to rely on benefits, which are, of course, also funded from taxation.

I have no doubt that you worked.

From your comments you worked in the Public Sector. I am guessing that you were paid for your work by your employer, who in turn received payment for services rendered to society. A good proportion of members of this society paid at some stage in their lives through taxation (and in some cases directly) for these services to be available. I am only guessing, so please correct as appropriate.

In essence, I am guessing that tax payers have paid for your wages and your pension, supplemented by a certain amount of direct payment outside the indirect taxation system.

Your pension was probably funded by a modest contribution from your own wage packet, a larger contribution by your employer and an even larger input from ??

I would be genuinely interested to know whether such a third party is involved and if so, who that third party is.

By how much do you estimate the average remuneration package would need to be increased to achieve this attractive situation ? A % figure would be useful.

Most of us made a decision to go into the public or private sector early in our lives. It was accepted that the private sector carried potentially far greater financial rewards but the public sector was seen to carry the opportunity to contribute something useful to society despite often being paid far less. The other carrot to do so was the promise of a fairly secure job and a decent pension at the end.

Strikes me that having had the opportunity to put some of the greater earnings from the private sector into decent financial planning, that many chose to live the high life rather than plan for the future. You can't have it both ways.

In hindsight I'd have had a far more comfortable life in the private sector, but I'm happy with my lot despite the likelihood of living to see much of my pension receding at a rate of knots (in line with the private sector in the form of bankers stealing much of it)

I have worked in both the Public and Private sectors and have a range of pensions from each.

Don

As you well know Civil Service Pensions are funded from general taxation - there is no "Pension pot".

The fact that so many in the private sector were shafted, with Government connivance, is reprehensible but not the fault public sector pensioners.

Stop being so mealy-mouthed and asking loaded questions and have the guts to say what you mean.

Interesting that you believe that public sector wages and pensions are mainly funded through indirect taxes (VAT, fuel and excise duties) rather than direct taxation.

I took a lower paid job (against private sector) working for a now privatised company, 38 years later I have the pension from that work. Am I supposed to apologise for this?

How many private sector firms or workers were paying into pension schemes? 

I was trained by the State. I work for the State. I am paid by the State. My pension is part of my pay-not a seperate element.

I don't believe my pay is being augmented by anyone's 'lost pension'. The NHS pension scheme makes a profit for UK PLC. This made the recent further attack on my pension rather galling but hey ho.

End of story for me I'm afraid.

Bruce

I was advised by an old uncle – tight as the proverbial ducks bum

– “get yourself a decent pension boy!!!”

Thankfully I heeded his advice – one of the rare times I heeded anything - & got started very early in my working life.   

Throughout I worked for myself or private cmpys. I was able by design or accident to increase my & employers contributions as time went on & ended with a snr mngt scheme that really boosted my last 12 years.   

Despite what the employers contributed,  I consider that I paid in full for all my pension, my contributions & the employer contribution I consider as my blood & sweat. Most years I spent more days/nights away from home than most people work days in a year. I missed my kids growing up, I watched my wife being thought of as a single parent as parent teacher evenings & that’s just the emotional part  – yes we, the whole family, paid for it.

I am now living high on the hog & thanks to other investments have an income not far off the same as my last best paid years at work.

Now with my kids going thru the best of their working years, I now know my age group got real lucky, right time right place.  I feel sorry for them as they will never be able to match what I’ve got in terms of %%% of salary.

The decision to work in the private or public sector is not necessarily straightforward.

I have worked in the steel industry all my life.

Initially (1966) in the private sector Samuel Fox &Co.( under the United Steels Co. banner).

Privatised in 1967 forming British Steel Corporation. Privatised again during the 80's.

I was fortunate in that the pension funds I was/am in BSP, Corus survived and are still in good health.

Not so for some of my colleagues. Alloy Steel Wire being a prime example.

They paid into the then BSC fund for many years. On privatisation they were transferred into a private pension fund. The company went bust and the pension fund was milked. 

Result : 40 years in the industry and no pension.

I don't think anyone is immune from fraud and theft (as this is what your situation is).

I can see that my pension with USS may not exist when I come to claim it and I have no other funds to fall back on if it doesn't.

I have complete sympathy with your plight and it shows me why the 'Private is good, Public is bad' is simply too nuanced for anything to be black and white. I hope you've managed to find some way through the nightmare.

EDIT: Just re-read your message and saw that you were fortunate. Life is about luck as well as risk I guess

 Too true Penarth. Many's the time I thought , but for the grace of God go I.

I was one of the 30.000 steel workers left in employment out of the 250,000 when I started.

Where are you, Don?

? Some of us have jobs as well as pensions

I've spent most of the day on top of the clouds.

+ 1

steve

So the answer to my first question is "the tax-payer is paying for Public Sector pensions"

In the case of Private Sector pensions it is "the customer"

ISTM that one of the principal imbalances of these arrangements is that "the customer" is free to easily take his "custom" elsewhere, especially in a global ecconomy. "The tax-payer" can't - he has to persude the Government to redress this sort of imbalance.

The answer to your question is that pensions are part of the Public Sector remuneration package, same as the Private Sector. I'm really not sure why you are separating them out.

If you choose to take more pay and less pension that's your choice in the Private Sector - which is why the Govt is now forcing all employers to pay Pension contributions now.

Public Sector workers historically earn far less over time than Private Sector workers but it's always the Private Sector come whinging when the inevitable downturn comes. A sense of entitlement that never ceases to amaze me - particularly when a lot of the Private Sector work comes from the Public Sector.

However, I guess you are saying that the Private Sector can deliver a better service for less than the Public Sector. I fundamentally disagree with you. Once profits are to be had inevitably it is service and value for money that get screwed.

The private banks should never have been in a position to screw us all over as they have been. God help us all if the Private Sector fully gets hold of the NHS. The you'll really have to pray you keep your job - great when you're young and healthy but terrifying as you get older.

Oh, and before you ask, I do know how the private sector works in some detail.

And if private sector pensions are so poor that pensioners need to rely on benefits, who pays for those? Oh, the taxpayer. So we dumb down the public sector pensions so that everyone has a poor pension and relies on benefits. Great. Saving to the taxpayer; diddly squat. Adverse impact on society, massive.

Perhaps, Don, you are simply trying to wind people up. But a little more research into public finances and economics might demonstrate that the world is not as simple as the Daily Mail would have you believe. 

So what?

What would you do about it (if you think something should be done about it - your position has not really been clearly stated ) and why?

There seems to be an awful lot of defensive and somewhat abusive argument comming from the Public Sector. Quite un-necessary.

As Bruce pointed out above, we all have a remuneration package, wages, pension arrangements, benefits, holidays etc. I'm well aware of the nature of these packages, both in the Public Sector and the Private Sector. As a guide, I have spent about 1/3 of my work life in the Public Sector and about 2/3 in the Private Sector. More than half my pension comes from the Public Sector and less than half from the Private Sector.

You all clearly acknowledge the generous pensions enjoyed in the Public Sector and a couple of you have asked what I would do to redress the imbalance. Well, much to HH's horror, (sorry HH) I would start by terminating final salary pension schemes for new entrants in the Public Sector. I would also freeze current Public Sector final salary schemes at 1/60th per year served based on annual related earnings (ie back-dated as if they were a CARE scheme), and simply direct future pension contributions into "open market" anuity purchace schemes without any increase in the currently declared employer contribution percentage.

Then I would start looking at ways of improving all pensions, Public and Private, on an equitable basis.

I genuinely hope you all have better and more realistic proposals.

Firstly, I don't accept your premise that there is some unfairness here. Private sector pensions have been decimated by greedy bosses who are there to maximise shareholder dividends at the expense of the people who created the wealth in the first place.

That is not caused by Public Sector pensions and cannot, and should not, be solved by some spurious race to the bottom.

Sorry if your private sector pension is a disappointment but envy is an unattractive trait and no basis for sensible policy making.

Envy is a very unattractive trait.

Hard to think of a worse idea than handing yet more of our money to the greedy incompetent commission hungry deceitful thieving vermin that infest the so called "financial services" industry! 

So, no practical proposals ?