Who is paying for your pension ?
Posted by: Don Atkinson on 02 February 2014
Who is paying for your pension ?
I ask this of anybody with a UK public servant pension, which includes Gov Officers, Local Authority Officers, NHS staff, Teachers, Policemen, Firemen, etc etc It also includes quasi government organisations such as Network Rail, train drivers and other ex employees of British Rail, and similar “privatised” organisations where employees retained their pension rights under their Tuped transfers.
For those in the private sector where final salary pension schemes are largely a thing of the past, I would ask….
Who is living off your lost pension ?
George, stick whatever you have in LVLT, it's doing rather well.
Dear count,
No idea what LVLT stands for.
I believed the hype over a private pension.
In another life, I'd hoard gold Sovereigns under the mattress ,,, as I see it now!
ATB from George
Dear count,
In simple terms, what does LVLT stand for - like NATO stands for North Atlantic Treaty Organisation?
ATB from George
PS: I tend to take a cynical view of graphs ... The future progress may not be as past performance ...
Level 3 Communications. LVLT is just a symbol that's used to trade on the NYSE.
Yes graphs only show the past, but the future is looking good for this. All fun.
I was a civil servant for a number of years when I paid tax and a proportion of salary towards a pension. Now I recieve a pension I pay tax on that. The tax we all pay goes in part to subsidise private sector tax breaks - that means you, you ungrateful winker - do I bitch about it, no.
It is quite simple: any job has a remuneration package which includes a pension. I chose right; you chose wrong. Live with it; get over it. No sympathy or apology from me.
Hear, hear.
steve
Level 3 Communications. LVLT is just a symbol that's used to trade on the NYSE.
Yes graphs only show the past, but the future is looking good for this. All fun.
NYSE = New York Stock Exchange?
Please spell out your meaning - particularly your unfamiliar acronyms.
ATB from George
PS: I would not trust the New York Stock Exchange to be any less of a lot of fiddling buggers than the London Stock Exchange.
Don
Point taken. I am a bit cross today.
You have however stated in previous posts that public sector workers have no idea of hard work (or similar) and that I should be grateful to the taxpayer for subsidising my pension.
Both suggestions that I find really annoying and portraying a view of the Public Sector I feel is outmoded and unfair.
I'll dip out now Don; no intention to fall out but felt had to make my point-and I freely admit to not understanding the technical aspects oif this thread.,
Bruce
Bruce,
Many thanks for explaining your position. My only comment about hard work was in response to someone's comment that seemed to suggest hard work was the preserve of the public sector and I acknowledged later that my response was a bit over the top. I fully recognise there are hard workers and high calibre people in both sectors. I suppose we all have our "off" days and I hope mine haven't upset you too much.
Best regards
Don
I did post earlier that I had nothing more to say to you; this time I mean it.
I do hope so.
A requirement on all employers to set up a CARE scheme is absolutely right in my view. On this we are agreed. I'm not sure it is completely viable in the global economy in which we exist, but its definitely worth a try.
But I cannot agree that the taxpayer should subsidise it in any way. Now here, terminology needs to be clear. In my last Public Sector job my salary was £100,000 pa. My contibution was £7,200 pa and my employer declared a contribution of £10,800 pa. This makes my "employment package" £110,800 pa. No subsidies, just pure, honest, high quality, hard work. Pension expectation is for 1/60 th pa on the basis of a CARE, Index-linked pension, with 50% for surviving spouse. My proposal is for these same rules in both the Public and (new) Private sector. All schemes to be managed by Government. No diverting funds to own company investment etc. Any shortfall in expectation underwritten by Government, any surplus returned to Treasurary.
That would be nonsensical. Firstly it would be unaffordable and require either a large increase in general taxation, or a large cutback in other spending. I share your views here as well and mentioned them before. But, if its unaffordable for the Private sector its also unaffordable for the Public sector.
Secondly, it would incentivise companies to minimise their contribution. That's why I proposed the schemes be managed and underwritten by Government. its a compulsary scheme BTW !
Rather than paying ridiculous salaries to directors, and huge bonuses to encourage risk, This part could equally well apply to the NHS the BBC and quite a few orther publically funded sectors. But remember, the top 1% of earners pay 35% of all our taxes, so don't shoot them too soon !
the private sector should be compelled to provide decent pensions to those who generate their profits. That is what we are agreed upon, assuming it is sustainable in the global market.
Excellent! Perhaps here, the discussion should end, lest we go round again.....
Excellent! Perhaps here, the discussion should end, lest we go round again.....
oh ho !
I think we've rached the starting line.............
........but i'll leave it for a week or so.................
cheers
Don
Obvious troll is obvious - don't feed the troll.
Level 3 Communications. LVLT is just a symbol that's used to trade on the NYSE.
Yes graphs only show the past, but the future is looking good for this. All fun.
George, I hope you followed my advice and put all your assets in LVLT, as it's up 13% from Feb 17th and rising.
Level 3 Communications. LVLT is just a symbol that's used to trade on the NYSE.
Yes graphs only show the past, but the future is looking good for this. All fun.
George, I hope you followed my advice and put all your assets in LVLT, as it's up 13% from Feb 17th and rising.
George has retired to Bermuda, didn't you know ? 
It wouldn't surprise me Don haha.
Now up to 19% increase from Feb 17th. Winky should listen to taxi drivers.
I have just put all my liquid assets into a 45 year old English Carlton racing bike - all of fifty pounds Sterling!
So have to postpone retirement for another fifteen years unfortunately!
ATB from George
£50 well invested though George!
Now up 25% since Feb 17th. Taxi!
Up 30% since Feb 17th.
In addition to the general ongoing LVLT rise, on Oct 11th all markets took a big dip, so I invested a few thousand more into LVLT and sold that purchase 14 days later for a 14.5% profit.
I will just keep on postponing my retirement as we will become 120 - nobody is willing to finance that.
I have never had access to a company pension scheme of any sort, so my only relationship with this issue is as a taxpayer funding other people's pensions. Human nature dictates that nobody is going to come knocking on my door and share a slice of their gold plated, non-contributary civil servants pension with me as a result of any sharing, socialist, egalitarian principle they may have. In their position, I doubt I would, either.
If I wanted to hold anyone responsible for this, it would have to be every government for the last century, who all failed to address this entirely predictable issue in any effective way. Am I going to lose any sleep over this, get bitter about it, or hold a grudge? No, life's far too short. I'll make my own provision as best I can, and live with the consequences.
For the avooidance of doubt, when I started this thread (and also now) I wasn't bitter and I hold no grudge. To a large extent this is probably due to the fact that I have a decent pension myself.
I was merely trying to find out who might have funded my Public Service pensions - I know for a fact that the contributions made by myself and the contributions decared by my gov departments simply couldn't fund such pensions on an average basis and probalbly by a factor of one-and-a-half or two. Perhaps it is the taxpayer, perhaps it was previous contributors to the pension funds. The concensus from contributors to this thread seems to point to the taxpayer. I simply don't know.
Equally, I was wondering who was benefitting from the rather pitiful private sector pensions that are available from Anuity Providers.
I also wondered whether the gov could take over private sector pension arrangements and turn them into the more attractive looking Public Sector type Pensions. One or two forumites seemed to think this might be worth a look.
Meanwhile, the gov has changed the rules on how private pension pots can be utilised. I forsee a few winners and loosers stories in the comming year or two, whilst things settle down.
In fact the rules of access to personal pensions have not yet changed, they are expected to once these rules have been determined in detail and put through legislation for next year.
The change to access on these funds is a sea change however. Once you've worked your way through the most efficient route to covering the tax payable, while annuities may still be appropriate to some, self determination on how you provide yourself with a retirement income is a good thing!
Chaps
This discussion has become loopy and has gone up its own arse.
The facts are simple. Pension schemes were mainly set up in the 1950s. The Public sectors debased the civil service salaries by 7% in order to pay the pensions of those about to retire. The standard was retirement at the at the age of sixty in the knowledge that the pensioner would live for just under 9 years. This was, even in its day generous, but back in those days, the public sector paid badly and a good pension was seen as a long term form of compensation for low pay. The public sector pay rocketed in the late sixties when staff associations such as NALGO negotiated better packages.
The private sector pensions tended to be the preserve of the white collar staff and a typical deduction was 4% of the salary with the employers adding a typical 7%. This funded a retirement at 65 and the pensioner usually lived for just under 5 years.
The problem we have is that in the main, the level of contributions have remained the same but the benefits increased. Lump sums became payable in the seventies, death in service payments were added to the portfolio and during the late nineties, the pension funds were used to finance early retirement packages. Of course, the biggest strain on pension funds is that our life expectancy has increased to 83 and the maths simply do not add up.
Don asked for a suggestion, well it is simple. My son is a Trustee of the Honda pension scheme and they had put their retirement age back from 60 to 62 then back to 63 and now (I believe) to 66. Even by delaying the age of retirement, there is still a shortfall because the employee pays only 6% and it needs to be increased and fast.
The answer is, if you want to start work at 20 and retire at 60 with an annual increase built in and die at 83, you need to make sure that you and your employer pay 18% into your pension every year of your working life. That takes a change of attitude and a lot of self discipline but it is the only way.
Final salary schemes are in my opinion absolutely essential if retirees are not to become a burden on the state. Therefore we must aim for the continuation of final salary schemes but accept the fact that they must be paid for and the current levels of contribution have to be increased.
Regards
Mick