Age discrimination and pensions

[jj22...@gmail.com]

There is some disquiet amongst my colleagues around new pension arrangements that will only apply to some members of staff (notably, not the union negotiating team).

Consider two members of staff, who both joined on the same day. One is 39 and one is 40, apart from that they are identical. Under the new rules the 40 year old will contribute less per annum and retire at 55 on a pension two to three times that of the 39 year old, who will only be entitled to retire at 67.

This seems grossly unfair, but presumably it is watertight legally?

[Cash]

Is this a private company, local authority, health authority or civil
service pension scheme - and are they both contributing to a final salary or
average salary pension - and how long have they been employed?

Cash

[jj22...@gmail.com]

> Is this a private company, local authority, health authority or civil
>
> service pension scheme - and are they both contributing to a final salary or
>
> average salary pension - and how long have they been employed?

It's public sector (there's an added complication that the pension pot is part local authority and part public sector, but ignore that) - and has been in the news a bit this week.

Again, they have both been employed for exactly the same length of time. 5 years.

The pension scheme was final salary, and is not becoming average salary (although that's a bit moot, because it's extremely unlikely anyone will be able to perform their duties and make it to retirement age).

As an aside, the cost of the changes to the younger person works out at around 500,000 pounds.

[steve robinson]

Look at this from another angle, the pension recieved is still likely
to be far greater than any scheme available to the private sector
employees who's schemes have all but collapsed, the private sector
through taxation subisidise not only all public sector pay but all
civil service pensions they are not self supporting, hence the need to
reform them.

It does seem unfair however looking at the whole picture if the system
is not rejigged i can see in the near future a demand for access for
all to government backed private schemes offering similar terms and as
a nation we cant afford it.

[John Briggs]

On 08/09/2012 10:55, steve robinson wrote:
>
> Look at this from another angle, the pension recieved is still likely
> to be far greater than any scheme available to the private sector
> employees who's schemes have all but collapsed,

But not for private sector bosses, of course, who do remarkably well.

> the private sector
> through taxation subisidise not only all public sector pay but all
> civil service pensions they are not self supporting, hence the need to
> reform them.

That would be because civil servants don't pay tax, would it?

> It does seem unfair however looking at the whole picture if the system
> is not rejigged i can see in the near future a demand for access for
> all to government backed private schemes offering similar terms and as
> a nation we cant afford it.

How do you know we can't afford it? Because those private sector bosses
say so? In fact, a pensions commission in the 1980s recommended exactly
what you suggest - Mrs Thatcher rejected it, of course.
--
John Briggs

[Robin]

> As an aside, the cost of the changes to the younger person works out
> at around 500,000 pounds.

Changes to pension schemes often involve "cliff edges" between different
groups according to age. That said, the difference you describe does
seem exceptionally large. Dare I ask if you are sure there is not a
"tapered protection" which means the difference is less stark than you
think? (There is eg for the police scheme reform which has been in the
news but I am of course making no assumption or suggestion about that
being the scheme in question).

--
Robin
reply to address is (meant to be) valid

[jj22...@gmail.com]

> It does seem unfair however looking at the whole picture if the system
> is not rejigged i can see in the near future a demand for access for
> all to government backed private schemes offering similar terms and as
> a nation we cant afford it.

I think you miss the point I'm trying to make. This isn't a point about pension reform in general, but in this instance two people on exactly the same terms and conditions are treated differently, by a massive financial margin.

It's also worth noting that both people are on the more modern rejigged pension arrangements that came in in around 1996, not the headline scheme that people retiring now are on.

[jj22...@gmail.com]

> seem exceptionally large. Dare I ask if you are sure there is not a
> "tapered protection" which means the difference is less stark than you
> think? (There is eg for the police scheme reform which has been in the
> news but I am of course making no assumption or suggestion about that
> being the scheme in question).

My information is gleaned from people working out the effect on them using the worked-examples provided by the union, so there are many potential sources of inaccuracy, yes.

...but that's still not addressing the age-related question.

[Yellow]

In article <q3F2s.309770$Xu5...@fx10.am4>, john.b...@ntlworld.com
says...

The figure of just the loss to this person has been put at half a
million pounds by the OP and you think unaffordability of these pensions
is a myth?

Where do you imagine the money for public sector - ie non-wealth
generating, tax payer supported - pensions come from? Trees?

Just think how many people in the private sector, or how much borrowing,
is required to support just one person with these huge pension pot
values.

I am on an average wage and therefore pay around 6 grand a year in tax
and national insurance. Say I work for 40 years on that wage (crude
maths I know) that's 240 grand in a life time. To support a million
pound pension pot it is going to take more than 4 of me without any of
our monies paying for anything else like health care or our own state
pensions - so someone else's tax (or more borrowing) is going to have to
be supporting me as well as themselves in those areas too.

Crude maths as I said, but it gives a perspective.

Still think these pensions are affordable?

[John Briggs]

And how, precisely, does your position differ from a public-sector
worker on the same salary?
--
John Briggs

[steve robinson]

John Briggs wrote:

> On 08/09/2012 10:55, steve robinson wrote:
> >
> > Look at this from another angle, the pension recieved is still
> > likely to be far greater than any scheme available to the private
> > sector employees who's schemes have all but collapsed,
>
> But not for private sector bosses, of course, who do remarkably well.

Only those in the top 500 business though

>
> > the private sector
> > through taxation subisidise not only all public sector pay but all
> > civil service pensions they are not self supporting, hence the need
> > to reform them.
>
> That would be because civil servants don't pay tax, would it?

Not enough to self finance thier own schemes, if you look at the tax
raising position of both sectors you will see the private sector
contributes far more to the coffers than the public sector

>
> > It does seem unfair however looking at the whole picture if the
> > system is not rejigged i can see in the near future a demand for
> > access for all to government backed private schemes offering
> > similar terms and as a nation we cant afford it.
>
> How do you know we can't afford it? Because those private sector
> bosses say so? In fact, a pensions commission in the 1980s
> recommended exactly what you suggest - Mrs Thatcher rejected it, of
> course.

We are running near a trillion deficit, if uk plc was a business the
administrators would have been bought in a long time ago.

[steve robinson]

GBs employer makes a profit, in turn pays corperation tax, employers
national insurance, business rates , VAT the public sector doesnt
make a profit , may notionally pay vat and employers stamp but as these
two taxes are paid from pot a in the public purse to pot b in the
public purse the public purse has not actually collected any tax just
moved it around

[steve robinson]

The issue is given we are all living longer can you expect to retire at
55 and recieve a lump sum payout plus a pension of around 2/3 your
income for the next 30 years index linked

[steve robinson]

No i fully understand your point and yes it is unfair , its also unfair
to expect those in the private sector to foot the bill for pension
levels they cant have themselves and to rub salt into the wounds have
to work until they are 65 plus


This isnt a new problem its een estering for years its just been icked
into the long grass unfortrunatly the grass now needs to be cut

[Nick Odell]

Erme - no.

We are running a deficit of about £121 billion while the public debt
stands at nearly £1.3 trillion. Debt and deficit are two different
things.

Nick

[steve robinson]

Makes little difference Nick we owe £1.3 trillion and this debt is
increasing year on year at the rate of £121 billion

Ultimately we have been running at a significant loss for many years
because of the debts incurred wether you label it a debt or a deficit
it amounts to the same thing we are in the poo

[Percy Picacity]

Since they have just done exactly the same to the NHS scheme, although
with a taper period, I think, I doubt if it is legally vulnerable.


--

Percy Picacity

[Yellow]

In article <n5H2s.365100$c01.3...@fx01.am4>, john.b...@ntlworld.com

says...
>
> On 08/09/2012 12:35, Yellow wrote:
> > In article<q3F2s.309770$Xu5...@fx10.am4>, john.b...@ntlworld.com
> > says...

> >> How do you know we can't afford it? Because those private sector bosses
> >> say so? In fact, a pensions commission in the 1980s recommended exactly
> >> what you suggest - Mrs Thatcher rejected it, of course.
> >
> > The figure of just the loss to this person has been put at half a
> > million pounds by the OP and you think unaffordability of these pensions
> > is a myth?
> >
> > Where do you imagine the money for public sector - ie non-wealth
> > generating, tax payer supported - pensions come from? Trees?
> >
> > Just think how many people in the private sector, or how much borrowing,
> > is required to support just one person with these huge pension pot
> > values.
> >
> > I am on an average wage and therefore pay around 6 grand a year in tax
> > and national insurance. Say I work for 40 years on that wage (crude
> > maths I know) that's 240 grand in a life time. To support a million
> > pound pension pot it is going to take more than 4 of me without any of
> > our monies paying for anything else like health care or our own state
> > pensions - so someone else's tax (or more borrowing) is going to have to
> > be supporting me as well as themselves in those areas too.
> >
> > Crude maths as I said, but it gives a perspective.
> >
> > Still think these pensions are affordable?
>
> And how, precisely, does your position differ from a public-sector
> worker on the same salary?

My position is different because my wages and pension is paid by "wealth
generation", and are therefore not just a cut of someone else's income
or from borrowings.

I cannot believe that there are still people who do not understand this.

[John Briggs]

Actually, large companies are now deciding not to pay corporation tax.
An awful lot of companies are not making profit.
--
John Briggs

[Percy Picacity]

You seem to have ignored the value of GB's work. Of course you can say
that public sector workers produce nothing of value, but that suddenly
may seem not wholly true should you need a coronary bypass operation,
and not have the 20,000GBP handy to pay for it.

--

Percy Picacity

[Percy Picacity]

If you have paid for it in terms of large chunk of your salary and
contracted to receive it then why not? Building contractors generally
expect to receive the amount they have contracted for, not 30% of it
because the customer finds it a more convenient sum to pay after the
work is completed.

--

Percy Picacity

[Percy Picacity]

You seem remarkably ready to believe the government's account of
events. You probably would not do so if they told lies about something
that affected you, because you would remember what really happened. It
so happens that the NHS pension scheme was completely renogotiated in
2008, using assumptions which are still valid, and new, affordable
scheme brought in for all new entrants. It is this, affordable, scheme
(as well as the old scheme which some have retained) that is now being
taken apart and new pay cut and tax is being applied to a group who
have already had a pay freeze for three years.

--

Percy Picacity

[John Briggs]

On 08/09/2012 15:35, Yellow wrote:
> In article<n5H2s.365100$c01.3...@fx01.am4>, john.b...@ntlworld.com

As most "wealth generation" was (and probably still is) done by banks,
those people would be justified in their perplexity.
--
John Briggs

[steve robinson]

In the very short term yes , but business in the main are set up to
make profit, without profit they eventually wither and die.

Do you honestly blame companies for reducing the tax liabilities.

At 30% corperation tax is too high , plus 13 % of wage costs as
employers contributions thats before you even look at business rates
throw in other costs like ssp maternity pay citb / eitb levies
all for what we couldnt evn get the bins emptied

[steve robinson]

Many a scheme is bankrupt propped up by the state , if it wasnt propped
up it would have collapsed years ago , the whole system was far too
generous compared to the funding supplied.

[steve robinson]

A pay freeze yes but they still get length of service rate hikes , in
most industries many have had pay freezes for 5 years or mor , in some
industries the pay has actually dropped it might be a little tough for
them at the moment but in general given the size of the public sector
most have jobs for life and terms and conditions many in the private
sector would die for.

[steve robinson]

I deliberately excluded GB value

I wouldnt insult publiuc sector workers in that way many do make a
fantastic contribution to society

[Yellow]

In article <BmL2s.380245$Uc7....@fx07.am4>, john.b...@ntlworld.com

says...
>
> On 08/09/2012 15:35, Yellow wrote:
> > In article<n5H2s.365100$c01.3...@fx01.am4>, john.b...@ntlworld.com
> > says...
> >>
> >> On 08/09/2012 12:35, Yellow wrote:
> >>> In article<q3F2s.309770$Xu5...@fx10.am4>, john.b...@ntlworld.com
> >>> says...

> >>> I am on an average wage and therefore pay around 6 grand a year in tax
> >>> and national insurance. Say I work for 40 years on that wage (crude
> >>> maths I know) that's 240 grand in a life time. To support a million
> >>> pound pension pot it is going to take more than 4 of me without any of
> >>> our monies paying for anything else like health care or our own state
> >>> pensions - so someone else's tax (or more borrowing) is going to have to
> >>> be supporting me as well as themselves in those areas too.
> >>>
> >>> Crude maths as I said, but it gives a perspective.
> >>>
> >>> Still think these pensions are affordable?
> >>
> >> And how, precisely, does your position differ from a public-sector
> >> worker on the same salary?
> >
> > My position is different because my wages and pension is paid by "wealth
> > generation", and are therefore not just a cut of someone else's income
> > or from borrowings.
> >
> > I cannot believe that there are still people who do not understand this.
>
> As most "wealth generation" was (and probably still is) done by banks,
> those people would be justified in their perplexity.

Whatever. My wages however are paid by adding value to goods, otherwise
know as manufacturing.

[Yellow]

In article <5ucl56....@news.alt.net>, k...@under.the.invalid says...

To use your analogy - if I cannot afford to pay my builder, after
agreeing a contract with him, he can pursue me into bankruptcy but the
limit to what he can receive is the amount of money that I have.

Bur where public sector is concerned, there is no such limit[1], be it
to pay for pensions or for wages. We, as a country, can borrow more or
we can increase taxes on both income and wealth or we can divert funds
from other publicly funded spending. And that's why the debate had to
move to one of affordability.



{1] Well there is, because eventually no one would lend to us.

[Percy Picacity]

Well, is it not part of that contribution to GDP which is ultimately
paying for their pension, regardless of whether they are paid out of a
firm's costs or out of taxation? That is the sleight of hand in your
argument which suggests that *other* people have to pay for their
pension. Just as it is the profit on a private sector worker's
production of widgets which is paying for his pension, it is the added
value to society by, say, a doctor or police officer which is paying
for their pension.

--

Percy Picacity

[steve robinson]

> your argument which suggests that other people have to pay for their

> pension. Just as it is the profit on a private sector worker's
> production of widgets which is paying for his pension, it is the
> added value to society by, say, a doctor or police officer which is
> paying for their pension.

The point is any added value is notional the product they create as no
resaleable value it adds nothing to the public purse no profit.

[m...@privacy.net]

On 8 Sep,

"steve robinson" <st...@colevalleyinteriors.co.uk> wrote:

> Many a scheme is bankrupt propped up by the state , if it wasnt propped
> up it would have collapsed years ago , the whole system was far too
> generous compared to the funding supplied.
>

My scheme is independent from the state. For years we paid 7.5% and the
employer a similar amount. After a certain female prime minister came to
power it was deemed the scheme was in surplus, and contributions dropped to
4.5% and the employer had a contribution 'holiday'. This has been followed by
employer contributions rising to 20%+, a reduction of benefits and increased
member's contributions.

If the scheme had been allowed to make a 'profit' in the good years there
would still be more than enough in the pot to cover future pensions.

Political intervention ruined this scheme, and most other contributory
schemes.

Civil service (super-annuation) schemes are a different can of worms, they
paid the chancellor a good dividend but failed to put anything away for
future pension payments as they were expected to be covered by contributions
at the time.

This won't work when the workforce is reduced in the interests of
'efficiency'.


--
BD
Change lycos to yahoo to reply

[steve robinson]

<m...@privacy.net> wrote:

> On 8 Sep,
> "steve robinson" <st...@colevalleyinteriors.co.uk> wrote:
>
> > Many a scheme is bankrupt propped up by the state , if it wasnt
> > propped up it would have collapsed years ago , the whole system was
> > far too generous compared to the funding supplied.
> >
> My scheme is independent from the state. For years we paid 7.5% and
> the employer a similar amount. After a certain female prime minister
> came to power it was deemed the scheme was in surplus, and
> contributions dropped to 4.5% and the employer had a contribution
> 'holiday'. This has been followed by employer contributions rising to
> 20%+, a reduction of benefits and increased member's contributions.

Was this as a direct action of a certain female prime minister or from
advice taken at the tme from the financial services sector who in
general overestimated the profits of the schemes.

>
> If the scheme had been allowed to make a 'profit' in the good years
> there would still be more than enough in the pot to cover future
> pensions.

Its swings and round abouts, im sure if the roles were reversed and
the pot was over flowing contributers would be complaining that they
were not getting a decent return on thier investment and would quite
rightly either demand a larger return or lower premiums

[AlwaysAskingQuestions]

Percy Picacity wrote:
> On 2012-09-08 14:10:03 +0000, steve robinson said:
>
>> John Briggs wrote:

[...]

>>> And how, precisely, does your position differ from a public-sector
>>> worker on the same salary?
>>
>> GBs employer makes a profit, in turn pays corperation tax, employers
>> national insurance, business rates , VAT the public sector doesnt
>> make a profit , may notionally pay vat and employers stamp but as
>> these two taxes are paid from pot a in the public purse to pot b in
>> the public purse the public purse has not actually collected any tax
>> just moved it around
>
> You seem to have ignored the value of GB's work. Of course you can
> say that public sector workers produce nothing of value, but that
> suddenly may seem not wholly true should you need a coronary bypass
> operation, and not have the 20,000GBP handy to pay for it.

Public sector workers have not produced any of that �20,000, they have
simply collected it from those who did produce it.

Again, this is not to devalue the work done by public sector workers but I
see no reason why they should be treated *better* than the private sector
who actually produce the wealth.

[AlwaysAskingQuestions]

If the customer goes bust then the contracter may be relieved to get as much
as 30%.

[Percy Picacity]

With respect, that is simply not true. Being able to take the factory
wages from the bank without paying half to a gangster is added value:
half your workers not having chronic diseases that reduce their
productivity adds value. And isn't most of our GDP service industries
anyway? Distinguishing private sector production that is paid for by
notional money in bank database changes and public sector production
that involves a different database is just falling for free market
propaganda.

--

Percy Picacity

[Percy Picacity]

True but irrelevant: the rich 1% in our society are doing very nicely,
thank you: nowhere near *bust*.

--

Percy Picacity

[Percy Picacity]

I realise we have had 40 years of propaganda about the value of cowboy
actors and free enterprise, but still cannot understand why people
think that production of wealth is not production of wealth when done
in the public sector! Surely if a private hospital had done the
operation it would be obvious that they had just provided a valuable
service worth 20,000GBP? Profit is a mechanism for controlling
production in a market, profit is not the actual thing produced.

Would it be clearer if they had been public sector coal miners or power
station workers? Or is skilled and valuable productive work suddenly
valueless when done in the public sector? If some rentier, or lord,
or financier/parasite doesn't make a 10% cut is the productive work
suddenly not valuable to the country, or worthy of meeting a cotractual
obligation to provide a paid-for pension? This is the economics of a
cowed and confused working class who become convinced their work is
only worthwhile if some laughing capitalist playboy lives on the
proceeds of it. Economic activity is (if useful) for the benefit of
our society.
Are we saying a masseuse or a betting office clerk is producing
*wealth* because someone is enjoying 10% of the value of their labour
in the Seychelles, but a neurosurgeon is useless because he is paid for
by taxes? It is not *profit* that defines the value of production, it
is the *value* of the goods or services produced. If a factory is
running at a loss, are the cars they produce suddenly not useful cars?

Perhaps this is why general practice is breaking down under the load of
foolish demands for instant gratification of trivial problems day and
night: people think because it is not profit-making it is not a scarce
and valuable service??


--

Percy Picacity

[steve robinson]

Service industries have a saleable commodity the banks sell you money
(interest on loans) hotels provide accomadation and meals for the many
vistors to the Uk (brings in foriegn currency)

The state does not sell its services it does not make a profit its
sole source of income is from the private sector .

Even the taxes paid by the public sector staff are financed from state
funds effectively .

Its not to say we dont need a public sector we do, the staff need to be
paid well but any remuneration package should be similar to those of
the private sector.
At the moment they are out of kilter .

You dont bite the hand that feeds you

[Zapp Brannigan]

"steve robinson" <st...@colevalleyinteriors.co.uk> wrote in message
news:xn0i2vok...@reader80.eternal-september.org...

> Its not to say we dont need a public sector we do, the staff need to be
> paid well but any remuneration package should be similar to those of
> the private sector.

During the boom-time 90's, my private sector friends were cashing huge
bonuses, luxury travel and social activities through the company. Their
salaries were markedly increased, the quality of their company cars went up
several notches, their expense accounts were bottomless.

I had none of that bonanza, just my normal boring beige civil servant's
salary adjusted for inflation.

So when you pay my arrears for the good times I was excluded from (about
£60-80,000, at a guess) you can ask me to share the painful downturn times.

[Yellow]

In article <5uedam....@news.alt.net>, k...@under.the.invalid says...

Yes we could, as a country, help ourselves to everyone's personal wealth
and I guess that would last a few years. Then what?

[Yellow]

In article <5uea3e....@news.alt.net>, k...@under.the.invalid says...

Does it add financial value or is the factory owner in fact simply
receiving what he is paying for?

<snip>

[the Omrud]

On 09/09/2012 12:35, Zapp Brannigan wrote:
>
> "steve robinson" <st...@colevalleyinteriors.co.uk> wrote in message
> news:xn0i2vok...@reader80.eternal-september.org...
>
>> Its not to say we dont need a public sector we do, the staff need to be
>> paid well but any remuneration package should be similar to those of
>> the private sector.
>
> During the boom-time 90's, my private sector friends were cashing huge
> bonuses, luxury travel and social activities through the company.
> Their salaries were markedly increased, the quality of their company
> cars went up several notches, their expense accounts were bottomless.

Your friends must be employed in a different sub-sector of the private
sector from me. Through the boom times, my employer (a global business
with 20,000 staff in the UK) kept a tight rein on expenses, perks, etc.
Travel has always been controlled and limited to low-cost options.

My bonus has never topped 20% and for many years was zero. Salaries
increased with promotion but annual cost-of-living increases were
usually a couple of points below inflation. Nobody in our business has
ever had an "expense account". Every penny of expenses is checked for
conformance with policy and signed off. Not in a restrictive way, and
occasional breaking of limits are permitted, but I'm talking about
spending £27 for dinner when the limit is £22.50. Occasionally.

--
David

[Robin]

> So when you pay my arrears for the good times I was excluded from
> (about �60-80,000, at a guess) you can ask me to share the painful
> downturn times.

May I add some salt to your wounds?

First, remember the lack of funding for the Principal CS Pension Scheme
suited the Treasury and successive Governments very well. If there had
been a fund and contributions by both employer and employees then civil
servants would not have had their salaries reduced on account of their
"non-contributory" pension. So their gross salaries would have been
higher. So they would have ended up with higher pensions and lump sums.

Second, remember much the same trick was pulled with bonuses. Contrary
to the impression politicians and the media like to give the public,
bonuses for civil servants were introduced by Ministers
against the wishes of most staff. The bonuses were funded by reducing
the pay they would otherwise have had. The bonuses were made
non-pensionable. So there was no net effect on total paybill but a tidy
little saving for the Treasury on pensions.

Third, the public sector is not monolithic. What you describe was true
generally. But some bits of the public sector did much better than
others. GP earnings are now legendary. Some others in the NHS did
pretty well too. The BBC needs no comment. But local government did
pretty well too, with chief executives and other senior managers
ratcheting up their salaries using the same "upper quartile" trick as
FTSE CEOs etc. In contrast Ministers bore down on civil service
salaries to the extent that a Permanent Secretary now typically get
c.�100,000 less than most council chief executives.

--
Robin
reply to address is (meant to be) valid

[steve robinson]

Zapp Brannigan wrote:

>
> "steve robinson" <st...@colevalleyinteriors.co.uk> wrote in message
> news:xn0i2vok...@reader80.eternal-september.org...
>
> > Its not to say we dont need a public sector we do, the staff need
> > to be paid well but any remuneration package should be similar to
> > those of the private sector.
>
> During the boom-time 90's, my private sector friends were cashing
> huge bonuses, luxury travel and social activities through the
> company. Their salaries were markedly increased, the quality of
> their company cars went up several notches, their expense accounts
> were bottomless.
>
> I had none of that bonanza, just my normal boring beige civil
> servant's salary adjusted for inflation.

Neither did the majority of those working in the private sector, you
could equally argue that some sections of the public sector did in the
90's and are still receiving large bonus, open ended expense accounts,
fantastic pensions luxury hotel and travel and i wont even go into
those at the very top.

[Zapp Brannigan]

"steve robinson" <st...@colevalleyinteriors.co.uk> wrote in message

news:xn0i2u9n...@reader80.eternal-september.org...

> Look at this from another angle, the pension recieved is still likely
> to be far greater than any scheme available to the private sector

> employees who's schemes have all but collapsed, the private sector

> through taxation subisidise not only all public sector pay but all
> civil service pensions they are not self supporting, hence the need to
> reform them.

"Hence the need" is a rather misleading way to approach this...

Imagine a 53yr old radiologist. She signed a contract 30 years ago with her
employer, setting out an agreement for the work she would undertake and the
rewards she would receive. She can't go back in time and use her life
differently, she has irrevocably dedicated herself to that profession and
purpose. So why should her employer be able to arbitrarily disown their
part of the bargain?

What would you say if you carried out a major refurbishment project for a
national chain, and they announced that they were not going to pay the
agreed rate after all? They had hoped that the refurbishment would
generate enough profit to pay your invoice, but it isn't "self supporting"
so you won't get the contractually-agreed £100,000 for each of the 93
branches you have so far converted. Instead they're only going to give you
£75,000 for each one.

[steve robinson]

Percy Picacity wrote:

> On 2012-09-09 08:20:02 +0000, AlwaysAskingQuestions said:
>
> > Percy Picacity wrote:
> >> On 2012-09-08 14:10:03 +0000, steve robinson said:
> >>
> >>> John Briggs wrote:
> >
> > [...]
> >
> >
> >>>> And how, precisely, does your position differ from a
> public-sector >>>> worker on the same salary?
> >>>
> >>> GBs employer makes a profit, in turn pays corperation tax,
> employers >>> national insurance, business rates , VAT the public
> sector doesnt >>> make a profit , may notionally pay vat and
> employers stamp but as >>> these two taxes are paid from pot a in
> the public purse to pot b in >>> the public purse the public purse
> has not actually collected any tax >>> just moved it around
> >>
> >> You seem to have ignored the value of GB's work. Of course you can
> >> say that public sector workers produce nothing of value, but that
> >> suddenly may seem not wholly true should you need a coronary bypass
> >> operation, and not have the 20,000GBP handy to pay for it.
> >
> > Public sector workers have not produced any of that £20,000, they
> > have simply collected it from those who did produce it.
> >
> > Again, this is not to devalue the work done by public sector

> > workers but I see no reason why they should be treated better than

> > the private sector who actually produce the wealth.
>
> I realise we have had 40 years of propaganda about the value of
> cowboy actors and free enterprise, but still cannot understand why
> people think that production of wealth is not production of wealth
> when done in the public sector! Surely if a private hospital had
> done the operation it would be obvious that they had just provided a
> valuable service worth 20,000GBP? Profit is a mechanism for
> controlling production in a market, profit is not the actual thing
> produced.
>

A private hospital will be self funded and treatment paid for outside
the nhs scheme.

> Would it be clearer if they had been public sector coal miners or
> power station workers? Or is skilled and valuable productive work
> suddenly valueless when done in the public sector? If some rentier,
> or lord, or financier/parasite doesn't make a 10% cut is the
> productive work suddenly not valuable to the country, or worthy of
> meeting a cotractual obligation to provide a paid-for pension? This
> is the economics of a cowed and confused working class who become
> convinced their work is only worthwhile if some laughing capitalist
> playboy lives on the proceeds of it. Economic activity is (if
> useful) for the benefit of our society.
> Are we saying a masseuse or a betting office clerk is producing

> wealth because someone is enjoying 10% of the value of their labour

> in the Seychelles, but a neurosurgeon is useless because he is paid

> for by taxes? It is not profit that defines the value of production,
> it is the value of the goods or services produced. If a factory is

> running at a loss, are the cars they produce suddenly not useful cars?
>
> Perhaps this is why general practice is breaking down under the load
> of foolish demands for instant gratification of trivial problems day
> and night: people think because it is not profit-making it is not a
> scarce and valuable service??

Coal miners had an end product that had a resale value on the open
market, could be exported , the consumers having a free will wether to
buy or not.

This is not the case with public services.

No one here believes that public sector workers are worthless

[Percy Picacity]

On 2012-09-09 12:10:10 +0000, Robin said:

> > So when you pay my arrears for the good times I was excluded from
>> (about £60-80,000, at a guess) you can ask me to share the painful
>> downturn times.
>
> May I add some salt to your wounds?
>
> First, remember the lack of funding for the Principal CS Pension Scheme
> suited the Treasury and successive Governments very well. If there had
> been a fund and contributions by both employer and employees then civil
> servants would not have had their salaries reduced on account of their
> "non-contributory" pension. So their gross salaries would have been
> higher. So they would have ended up with higher pensions and lump sums.
>
> Second, remember much the same trick was pulled with bonuses. Contrary
> to the impression politicians and the media like to give the public,
> bonuses for civil servants were introduced by Ministers
> against the wishes of most staff. The bonuses were funded by reducing
> the pay they would otherwise have had. The bonuses were made
> non-pensionable. So there was no net effect on total paybill but a tidy
> little saving for the Treasury on pensions.
>
> Third, the public sector is not monolithic. What you describe was true
> generally. But some bits of the public sector did much better than
> others. GP earnings are now legendary.

This internecine strife is unbecoming. The riches of GPs are just
that: legendary. For instance, did you know the quoted "salary'" of
GPs currently includes 22% pension contribution? And they don't get
all the perks of employees in terms of sick pay etc (though they do get
some of them by other means). And the GPs with really high incomes
are not getting this as a salary, but as a profit from acting as
entrepreneurs and employing other GPs, ie as independent business men.
All that happened is that GPs caught up with consultant pay, more or
less, and this is not enormously high despite the government lying
about it.

> Some others in the NHS did
> pretty well too. The BBC needs no comment. But local government did
> pretty well too, with chief executives and other senior managers
> ratcheting up their salaries using the same "upper quartile" trick as
> FTSE CEOs etc. In contrast Ministers bore down on civil service
> salaries to the extent that a Permanent Secretary now typically get
> c.£100,000 less than most council chief executives.


--

Percy Picacity

[Percy Picacity]

That was not my point. The fact is we are not so badly off as our
rulers pretend. And they are mismanaging things for short term profits
for their friends.

--

Percy Picacity

[Percy Picacity]

Of course a police force which enables us to run a business without
depredations of protection rackets etc. adds value. Without it he
wouldn't get what he was paying for: although his tax might be lower
and he could always try robbing his neighbour at gunpoint.

--

Percy Picacity

[steve robinson]

I believe the Mafia only take 10% far less than the government and
with that comes a level of protection that the police force only supply
to the government elite ;)

[Percy Picacity]

I believe in the Scottish Borders they used to take a great deal more,
leaving little but body parts: and conditions were not ideal for
business.

--

Percy Picacity

[Zapp Brannigan]

"steve robinson" <st...@colevalleyinteriors.co.uk> wrote in message

news:xn0i2vs3...@reader80.eternal-september.org...

> Neither did the majority of those working in the private sector, you
> could equally argue that some sections of the public sector did in the
> 90's and are still receiving large bonus, open ended expense accounts,
> fantastic pensions luxury hotel and travel and i wont even go into
> those at the very top.

I'm not disputing that others got rich, including some public sector
fat-cats. That's a simple fact.

My point is that if you want me (an individual public sector nonentity) to
slide down the snakes then you have to let me up the ladders too. "Any
remuneration package should be similar to those of the private sector" cuts
both ways.

[Zapp Brannigan]

"steve robinson" <st...@colevalleyinteriors.co.uk> wrote in message

> The issue is given we are all living longer can you expect to retire at
> 55 and recieve a lump sum payout plus a pension of around 2/3 your
> income for the next 30 years index linked

My employer was aware of rising life expectancy when they signed the
employment contract. Their pension liability, and mine, was carefully
worked out by expert actuaries. If it's turning out to be a bit more
expensive than they expected, that's not my problem.

The salary they pay me has turned out to be insufficient for my preferred
lifestyle, but that doesn't give me the right to require an extra £5.000 pa
(and take it regardless of their agreement). We are both bound, until the
contract is terminated.

[Robin]

> This internecine strife is unbecoming. The riches of GPs are just
> that: legendary. For instance, did you know the quoted "salary'" of
> GPs currently includes 22% pension contribution?

Well, yes actually. Perhaps on that basis I might ask if you aware but
did not think it worth mentioning that GPs are in an unusual postiion in
that they can be self-employed but have access to a Government-backed
pension scheme? Can you tell me of another such group who have the tax
and NI benefits (and other benefits) of self-employment but a pension
scheme underwritten in this way?

> And they don't get
> all the perks of employees in terms of sick pay etc (though they do
> get some of them by other means).

Yes. (But don't forget that being self-employed means less NI to take
account of this. Self-employed plumbers etc also have to take out their
own insurance or bear the risk.)

>And the GPs with really high
> incomes are not getting this as a salary, but as a profit from acting
> as entrepreneurs and employing other GPs, ie as independent business
> men.

What many have done is replace the traditional model of a partnership of
GPs all of whom have a capital (and hence usually long-term) interest in
the practice by a model of one or a few equity partners employing other
doctors (c/f a series of locums). Is there evidence that patients
benefit from or welcome such "entrepreneurship"? If so, why not just
replace
self-employed GPs (a fudge to create the NHS) by employed doctors?
(Answer AIUI: recent Ministers have been told that, unlike Aneurin
Bevan, they simply do not have enough gold to stuff GPs' mouths to get
them to swallow *that* change.)

> All that happened is that GPs caught up with consultant pay,
> more or less, and this is not enormously high despite the government
> lying about it.

Are you also accusing the GSS of lying?

[steve robinson]

Zapp Brannigan wrote:

>
> "steve robinson" <st...@colevalleyinteriors.co.uk> wrote in message
>
> > The issue is given we are all living longer can you expect to
> > retire at 55 and recieve a lump sum payout plus a pension of around
> > 2/3 your income for the next 30 years index linked
>
> My employer was aware of rising life expectancy when they signed the
> employment contract. Their pension liability, and mine, was
> carefully worked out by expert actuaries. If it's turning out to be a
> bit more expensive than they expected, that's not my problem.

Its not mine either although no doubt i will be expected along with
every other private sector worker and the business they work for to
make good on the public sector schemes, yet many of those very same
workers who have been royally shafted because they are in the private
sector are not offered the same level of support.

No one objects to any public sector employee getting a pension all
those in the private sector want is a level playing field.

[Percy Picacity]

On 2012-09-09 18:25:02 +0000, Robin said:

> snip

>> All that happened is that GPs caught up with consultant pay,
>> more or less, and this is not enormously high despite the government
>> lying about it.
>
> Are you also accusing the GSS of lying?

Perhaps more of publicising a small and unrepresentative subset of the truth.

--

Percy Picacity

[steve robinson]

Zapp Brannigan wrote:

>
> "steve robinson" <st...@colevalleyinteriors.co.uk> wrote in message
> news:xn0i2u9n...@reader80.eternal-september.org...
>
> > Look at this from another angle, the pension recieved is still
> > likely to be far greater than any scheme available to the private
> > sector employees who's schemes have all but collapsed, the private
> > sector through taxation subisidise not only all public sector pay
> > but all civil service pensions they are not self supporting, hence
> > the need to reform them.
>
> "Hence the need" is a rather misleading way to approach this...
>
> Imagine a 53yr old radiologist. She signed a contract 30 years ago
> with her employer, setting out an agreement for the work she would
> undertake and the rewards she would receive. She can't go back in
> time and use her life differently, she has irrevocably dedicated
> herself to that profession and purpose. So why should her employer
> be able to arbitrarily disown their part of the bargain?

That same argument applies accross the board however its something
those that subsidize the pensions of public employees have had to take
on the chin


Why should i be expected to support through the taxes i pay a pension
scheme that if it wasnt state supported would have collapsed long ago.

State employees are in a unique position in that thier employer is
unlikely to go bankrupt, does not have to be particulary effiecent and
has a captive marketplace , customers that cant go elseware. Its a
model that can no longer be supported in its present form .

Many people have lost pensions because employers no longer exist , had
funds modified because funds can no longer support the draw down on the
pot or employers will go broke if they had to continue to support
current pension levels within a global marketplace .



Why should public sector workers be exempt from this why do they feel
that they should be held above all others and demand that the whole of
society who can never obtain similar levels of pension return
subsidize thier pension funding

>
> What would you say if you carried out a major refurbishment project
> for a national chain, and they announced that they were not going to
> pay the agreed rate after all? They had hoped that the
> refurbishment would generate enough profit to pay your invoice, but
> it isn't "self supporting" so you won't get the contractually-agreed
> £100,000 for each of the 93 branches you have so far converted.
> Instead they're only going to give you £75,000 for each one.

Thats a completly different argument, but in answer to the question the
chain would lose within a very short time all its suppliers and
servicing contractors and ultimatly go bust.

Unless of course you expect the taxpayer to pick up the bill






>

[Percy Picacity]

But on your logic if all that coal had been transferred direct to the
CEGB without a bill being generated then it would suddenly have
magically ceased to be a valuable commodity and cutting it would
suddenly have become an unproductive service industry. Adding value is
doing things which have a value, not making a profit or loss, or
transferring bits of paper (or electronic) money. The value is not in
the money, that is a token, the value is in the work done, and its
contribution to society. And public sector work is just as likely to
be of value as private sector work. import/export is completely
separate consideration. We could I am sure produce a list of pointless
private and public sector jobs, but what makes them pointless is not
which system of tokens is used to pay for them: and in both cases
someone must think they are worth doing!


--

Percy Picacity

[Ste]

On Sep 9, 9:20 am, "AlwaysAskingQuestions"

<alwaysaskingquesti...@gmail.com> wrote:
> Percy Picacity wrote:
> > On 2012-09-08 14:10:03 +0000, steve robinson said:
>
> >> John Briggs wrote:
>
> [...]
>
> >>> And how, precisely, does your position differ from a public-sector
> >>> worker on the same salary?
>
> >> GBs employer makes a profit, in turn pays corperation tax, employers
> >> national insurance, business rates , VAT   the public sector doesnt
> >> make a profit , may notionally pay vat and employers stamp but as
> >> these two taxes are paid from  pot a in the public purse to pot b in
> >> the public purse the public purse has not actually collected any tax
> >> just moved it around
>
> > You seem to have ignored the value of GB's work.  Of course you can
> > say that public sector workers produce nothing of value,  but that
> > suddenly may seem not wholly true should you need a coronary bypass
> > operation, and not have the 20,000GBP handy to pay for it.
>
> Public sector workers have not produced any of that £20,000, they have
> simply collected it from those who did produce it.
>
> Again, this is not to devalue the work done by public sector workers but I

> see no reason why they should be treated *better* than the private sector

> who actually produce the wealth.

It's ludicrous to say that a surgeon performing a heart bypass is "not
producing wealth" and by implication is a parasite or dead weight on
our society. There would also be a much larger role for public sector
wealth creation, if it weren't limited simply on ideological grounds.

Also, nobody has ever said public sector workers should have better
pensions than private sector workers. The point is that private sector
workers have either let their pay and conditions be eroded by the
rich, or have alternatively sold their pay and conditions in exchange
for better income 10 or 20 years ago.

Public sector workers have traditionally enjoyed lower-than-market
average rates of pay in exchange for job security and pensions, and
they are quite reasonably insisting on continuing that long-term
arrangement, regardless of the vagaries of the private sector economy.
Also, most public sector workers are not against decent pensions for
the private sector, and merely insist that poor private sector workers
(and let's not pretend the rich in the private sector have anything to
worry about) bring themselves up, rather than expecting to drag poor
public sector workers down with them.

[Ste]

I'm almost jumping out my seat here Percy - I couldn't have put it
better myself!

[Zapp Brannigan]

"Yellow" <no...@none.com> wrote in message
news:MPG.2ab5be94c...@News.Individual.NET...
> In article <5ucl56....@news.alt.net>, k...@under.the.invalid says...

>> If you have paid for it in terms of large chunk of your salary and
>> contracted to receive it then why not? Building contractors generally
>> expect to receive the amount they have contracted for, not 30% of it
>> because the customer finds it a more convenient sum to pay after the
>> work is completed.
>

> To use your analogy - if I cannot afford to pay my builder, after
> agreeing a contract with him, he can pursue me into bankruptcy but the
> limit to what he can receive is the amount of money that I have.
>
> Bur where public sector is concerned, there is no such limit[1], be it
> to pay for pensions or for wages. We, as a country, can borrow more or
> we can increase taxes on both income and wealth or we can divert funds
> from other publicly funded spending. And that's why the debate had to
> move to one of affordability.

You appear to be saying that the state can cheat publicly-employed staff by
arguing 'affordability" as an excuse not to meet their contractual
obligations. That of course is incorrect - if the NHS has less money then
it should cut it's cloth accordingly, eg by employing fewer staff.

I don't say to Tesco that I am giving them £80 for my £100 trolley of
groceries because of "affordability". I might ask, and they might consent,
but otherwise I have no right to make them subsidise my desire to live
beyond my means.

[Ste]

On Sep 9, 1:10 pm, "steve robinson" <st...@colevalleyinteriors.co.uk>
wrote:

For the purposes of this argument Steve, they are either productive
workers, or they are not. The fact that it involves services as
opposed to physical goods does not mean public sector workers create
no wealth. The supposed fact that customers cannot go elsewhere for
provision, does not mean that public sector workers create no wealth.

And most compellingly, the fact that in the past the public sector
*was* involved in goods production in the same way as the private
sector, is decisively fatal to your argument that the public sector
cannot create wealth. The public sector has largely withdrawn from
goods production for ideological reasons only, just as both successive
Tory and Labour governments have also begun to assault the services
provided by the public sector, again for ideological reasons only.

[Ste]

On Sep 9, 1:10 pm, the Omrud <usenet.om...@gmail.com> wrote:
> On 09/09/2012 12:35, Zapp Brannigan wrote:
>
>
>
> > "steve robinson" <st...@colevalleyinteriors.co.uk> wrote in message
> >news:xn0i2vok...@reader80.eternal-september.org...
>
> >> Its not to say we dont need a public sector we do, the staff need to be
> >> paid well but any remuneration package  should be similar to those of
> >> the private sector.
>
> > During the boom-time 90's, my private sector friends were cashing huge
> > bonuses, luxury travel and social activities through the company.
> > Their salaries were markedly increased, the quality of their company
> > cars went up several notches, their expense accounts were bottomless.
>
> Your friends must be employed in a different sub-sector of the private
> sector from me.

You mean, you really believe nobody is ever doing well in the private
sector? How many headlines does it take, of top bankers, lawyers, and
captains of industry going home with fat paychecks, whether economic
times be good or bad?

> Through the boom times, my employer (a global business
> with 20,000 staff in the UK) kept a tight rein on expenses, perks, etc.
>   Travel has always been controlled and limited to low-cost options.
>
> My bonus has never topped 20% and for many years was zero.  Salaries
> increased with promotion but annual cost-of-living increases were
> usually a couple of points below inflation.  Nobody in our business has
> ever had an "expense account".  Every penny of expenses is checked for
> conformance with policy and signed off.  Not in a restrictive way, and
> occasional breaking of limits are permitted, but I'm talking about
> spending £27 for dinner when the limit is £22.50.  Occasionally.

That's because your share of that bonanza was going into the bosses'
pockets instead of yours.

[Ste]

More to the point, most public sector workers *do not want* to play,
*and have chosen not to play*, the private sector game of snakes and
ladders, because if every snake has a corresponding ladder, then you
may as well just accept a stable public sector salary.

The real issue is with some of those people in the private sector who
thought their game was all snake, and are now moaning because they've
ended up at the bottom of a ladder and want everybody else to follow
them down.

[Ste]

Most patients and public sector workers *did not support* these
measures! I dare say even GPs themselves were not united in favour.
They were driven through by a government determined to introduce
markets and private sector influence into public services,

[Percy Picacity]

On 2012-09-09 18:30:02 +0000, Ste said:

snip

>
> The real issue is with some of those people in the private sector who
> thought their game was all snake, and are now moaning because they've
> ended up at the bottom of a ladder and want everybody else to follow
> them down.

Don't know how to tell you this, but you've been playing the game back
to front all these years! Did your kids always win?

Not that I don't agree 100% with your point, though.

--

Percy Picacity

[Zapp Brannigan]

"steve robinson" <st...@colevalleyinteriors.co.uk> wrote in message

news:xn0i2vvzb...@reader80.eternal-september.org...

> Zapp Brannigan wrote:

>> Imagine a 53yr old radiologist. She signed a contract 30 years ago
>> with her employer, setting out an agreement for the work she would
>> undertake and the rewards she would receive. She can't go back in
>> time and use her life differently, she has irrevocably dedicated
>> herself to that profession and purpose. So why should her employer
>> be able to arbitrarily disown their part of the bargain?

>> What would you say if you carried out a major refurbishment project
>> for a national chain, and they announced that they were not going to
>> pay the agreed rate after all? They had hoped that the
>> refurbishment would generate enough profit to pay your invoice, but
>> it isn't "self supporting" so you won't get the contractually-agreed
>> £100,000 for each of the 93 branches you have so far converted.
>> Instead they're only going to give you £75,000 for each one.
>
> Thats a completly different argument, but in answer to the question the
> chain would lose within a very short time all its suppliers and
> servicing contractors and ultimatly go bust.

No, it isn't a completely different argument. Both are examples of one
party refusing to meet their obligations under a legal contract, to the
disadvantage of the other party.

And you haven't answered it.

[steve robinson]

> was involved in goods production in the same way as the private

> sector, is decisively fatal to your argument that the public sector
> cannot create wealth. The public sector has largely withdrawn from
> goods production for ideological reasons only, just as both successive
> Tory and Labour governments have also begun to assault the services
> provided by the public sector, again for ideological reasons only.

They pulled out because the nationalised industries wich once turned a
healthy profit prior to nationalisation ran at a loss, they realised
that governments are useless at running for profit business

[BartC]

"Percy Picacity" <k...@under.the.invalid> wrote in message
news:5ucl56....@news.alt.net...

> On 2012-09-08 14:15:02 +0000, steve robinson said:

> If you have paid for it in terms of large chunk of your salary and
> contracted to receive it then why not?

I doubt that they have literally paid for it.

*Some* contribution has been made to a fund (and often a big chunk of that
is in the form of a hefty share by an employer *over and above* the
employee's salary).

Whether the total of those contributions will finance a certain pension
(final-salary-based, index-linked etc) many decades into the future depends
on things such as investment returns, inflation, general economy, ... and
how long people are likely to live, up to 50 years in the future.

Yet it seems a specific pension must be guaranteed no matter how badly those
pension funds underperform. Whoever made those guarantees was acting
irresponsibly!

Everyone will agree that if an individual's contributions to a pension
fund - even including top-ups from an employer if that was part of the
deal - reaches £1000000 for example, then there is no problem in paying out
that £1000000 over the remainder of his lifetime. Perhaps with some give and
take as some people live longer than others.

But if his pension demands are such that £2000000 is needed for example,
twice what is available, then not everyone thinks that the difference should
be made up by other people working longer and harder - and who might get
considerably less for their own pension.

After all, once people retire, then they are all doing exactly the same
job - nothing! It doesn't matter what their previous job was. If they have
contributed a bit more, then fine; but if it's not enough, then tough!

--
Bartc

[Roland Perry]

In message
<8559be1b-299d-4049...@d9g2000vbf.googlegroups.com>, at
19:20:02 on Sun, 9 Sep 2012, Ste <ste_...@hotmail.com> remarked:

>How many headlines does it take, of top bankers, lawyers, and
>captains of industry going home with fat paychecks, whether economic
>times be good or bad?

It's worth noting that salaries over 100k are something like 1% of the
population, and 250k+ less than half a percent. Makes a good headline
but is of little relevance to the ordinary person on an average income.

Looking on the bright side, someone with that sort of income is very
likely to be employing people (nannies, gardeners etc) so it's not all
going on champagne and caviar. And expensive cars, which keeps people
who manufacture and service them in a job.
--
Roland Perry

[Roland Perry]

In message <45b6ae8b-f201-4d23...@googlegroups.com>, at
11:50:01 on Sat, 8 Sep 2012, jj22...@gmail.com remarked:
>> It does seem unfair however looking at the whole picture if the system
>> is not rejigged i can see in the near future a demand for access for
>> all to government backed private schemes offering similar terms and as
>> a nation we cant afford it.
>
>I think you miss the point I'm trying to make. This isn't a point about pension reform in general, but in this instance two people on exactly
>the same terms and conditions are treated differently, by a massive financial margin.

It would help me understand the problem if you could explain what it is
that differs in the two sets of circumstances, that creates the big
difference in pension. Is it some age threshold, or a scheme that was
only available to one of them, or what?
--
Roland Perry

[Roland Perry]

In message <5ucl56....@news.alt.net>, at 18:40:02 on Sat, 8 Sep
2012, Percy Picacity <k...@under.the.invalid> remarked:

>> The issue is given we are all living longer can you expect to retire
>>at
>> 55 and recieve a lump sum payout plus a pension of around 2/3 your
>> income for the next 30 years index linked
>

>If you have paid for it in terms of large chunk of your salary and

>contracted to receive it then why not? Building contractors generally
>expect to receive the amount they have contracted for, not 30% of it
>because the customer finds it a more convenient sum to pay after the
>work is completed.

It doesn't seem to work for private pension schemes. Currently I think I
would receive about a third of the pension I was "promised" when I
enrolled, but I'm sure the promise was really just a prediction, wrapped
up in enough weasel words that I have to grin and bear it.

Was there (Equitable Life aside) ever a private scheme which paid out a
'final salary' style of pension, assuming you kept up the monthly
payments for your working life?
--
Roland Perry

[Mark Goodge]

On Sun, 09 Sep 2012 23:30:02 +0100, Phil W Lee put finger to keyboard and
typed:
>>
>Nearly all private sector business would go bust if they had to pay
>the full cost of what they receive from the public sector.

Cite?

Mark
--
Blog: http://mark.goodge.co.uk
Stuff: http://www.good-stuff.co.uk

[the Omrud]

Sure - mine does. The scheme was closed a couple of years ago, but all
contributions up to then are honoured exactly as promised. I have about
20 years of contributions, which means I will be paid one-third of my
final salary annually from my retirement date. Those who have 40 years
of contributions get two-thirds.

--
David

[the Omrud]

On 09/09/2012 20:10, steve robinson wrote:
> Zapp Brannigan wrote:
>
>>
>> "steve robinson" <st...@colevalleyinteriors.co.uk> wrote in message
>>
>>> The issue is given we are all living longer can you expect to
>>> retire at 55 and recieve a lump sum payout plus a pension of around
>>> 2/3 your income for the next 30 years index linked
>>
>> My employer was aware of rising life expectancy when they signed the
>> employment contract. Their pension liability, and mine, was
>> carefully worked out by expert actuaries. If it's turning out to be a
>> bit more expensive than they expected, that's not my problem.
>
> Its not mine either although no doubt i will be expected along with
> every other private sector worker and the business they work for to
> make good on the public sector schemes, yet many of those very same
> workers who have been royally shafted because they are in the private
> sector are not offered the same level of support.
>
> No one objects to any public sector employee getting a pension all
> those in the private sector want is a level playing field.

But what if it's a large supermarket which has to make up this
shortfall? Surely the costs of funding it will fall on the customers of
the supermarket who will pay a little more for their apples and bread.
Doesn't seem much different from teachers or tax inspectors.

--
David

[Roland Perry]

In message <ohh3s.734201$0b5.5...@fx28.am4>, at 09:15:03 on Mon, 10
Sep 2012, the Omrud <usenet...@gmail.com> remarked:

>> Was there (Equitable Life aside) ever a private scheme which paid out a
>> 'final salary' style of pension, assuming you kept up the monthly
>> payments for your working life?
>
>Sure - mine does. The scheme was closed a couple of years ago, but all
>contributions up to then are honoured exactly as promised. I have
>about 20 years of contributions, which means I will be paid one-third
>of my final salary annually from my retirement date. Those who have 40
>years of contributions get two-thirds.

I've never come across such a scheme myself. I wonder how they stop you
from artificially inflating your salary in the final year, to get a
bigger pension?

It's all very well for a company scheme, where people are on a pretty
well defined career path, but for someone effectively self-employed like
myself[1], I could save up my wages for a couple of years and then pay
it all out the final year!

[1] Not in the tax/NI sense, but I'm a director of a very small company
so what I pay myself as salary is at my own discretion, although there's
corporation tax to pay if I don't take all the profits as salary.
--
Roland Perry

[the Omrud]

On 09/09/2012 19:20, Ste wrote:
> On Sep 9, 1:10 pm, the Omrud <usenet.om...@gmail.com> wrote:
>> On 09/09/2012 12:35, Zapp Brannigan wrote:
>>
>>> "steve robinson" <st...@colevalleyinteriors.co.uk> wrote in message
>>> news:xn0i2vok...@reader80.eternal-september.org...
>>>
>>>> Its not to say we dont need a public sector we do, the staff need to be
>>>> paid well but any remuneration package should be similar to those of
>>>> the private sector.
>>>
>>> During the boom-time 90's, my private sector friends were cashing huge
>>> bonuses, luxury travel and social activities through the company.
>>> Their salaries were markedly increased, the quality of their company
>>> cars went up several notches, their expense accounts were bottomless.
>>
>> Your friends must be employed in a different sub-sector of the private
>> sector from me.
>
> You mean, you really believe nobody is ever doing well in the private
> sector? How many headlines does it take, of top bankers, lawyers, and
> captains of industry going home with fat paychecks, whether economic
> times be good or bad?

Of course I don't believe that. I'm doing well, for example, far beyond
the expectations of my parents. But these sky-high benefits were given
only to the very few. I suppose it's possible that all Zapp's public
sector friends in the 90s were CEOs and FDs, or that he only knew people
working in banking with silly bonuses, but it's not a fair
characterisation of "the private sector".

>
>> Through the boom times, my employer (a global business
>> with 20,000 staff in the UK) kept a tight rein on expenses, perks, etc.
>> Travel has always been controlled and limited to low-cost options.
>>
>> My bonus has never topped 20% and for many years was zero. Salaries
>> increased with promotion but annual cost-of-living increases were
>> usually a couple of points below inflation. Nobody in our business has
>> ever had an "expense account". Every penny of expenses is checked for
>> conformance with policy and signed off. Not in a restrictive way, and
>> occasional breaking of limits are permitted, but I'm talking about
>> spending £27 for dinner when the limit is £22.50. Occasionally.
>
> That's because your share of that bonanza was going into the bosses'
> pockets instead of yours.

Even if that were true, there are only a dozen bosses (of that sort of
level) amongst 20,000 staff. Again, why should I be lumped together
with them and told that I've been living the good life with huge
benefits, just because I'm employed by a private company? I'm well
paid, I'm senior in the company, but I just don't recognise all that
stuff about vast benefits.

--
David

[Ste]

On Sep 9, 10:50 pm, "steve robinson" <st...@colevalleyinteriors.co.uk>

There is no necessary reason why the public sector as a whole has to
make a profit, which in this case would be more aptly called a
surplus, because the only logical way to distribute it would be back
to the very people who created it. It's much easier to understand
that, when you come to see profit as essentially being the difference
between what was produced by workers, and what those workers actually
received in wages.

[Ste]

On Sep 10, 7:35 am, Roland Perry <rol...@perry.co.uk> wrote:
> In message
> <8559be1b-299d-4049-9e2f-18bfb1f9e...@d9g2000vbf.googlegroups.com>, at
> 19:20:02 on Sun, 9 Sep 2012, Ste <ste_ro...@hotmail.com> remarked:

>
> >How many headlines does it take, of top bankers, lawyers, and
> >captains of industry going home with fat paychecks, whether economic
> >times be good or bad?
>
> It's worth noting that salaries over 100k are something like 1% of the
> population, and 250k+ less than half a percent. Makes a good headline
> but is of little relevance to the ordinary person on an average income.

Yes, but what share of the pie do those incomes represent? And more to
the point, what about *unearned income* as oppposed to "salary"?

> Looking on the bright side, someone with that sort of income is very
> likely to be employing people (nannies, gardeners etc) so it's not all
> going on champagne and caviar. And expensive cars, which keeps people
> who manufacture and service them in a job.

I had this one the other day on another thread. If the money paid to
the rich was paid to the poor instead, they would still be buying
goods and services and therefore creating consequential employment -
in fact, the poor spend a far greater proportion of their income than
the rich, often spending 100% immediately upon receipt.

[Tim Jackson]

On Mon, 10 Sep 2012 09:45:02 +0100, Roland Perry wrote...

>
> In message <ohh3s.734201$0b5.5...@fx28.am4>, at 09:15:03 on Mon, 10
> Sep 2012, the Omrud <usenet...@gmail.com> remarked:
> >> Was there (Equitable Life aside) ever a private scheme which paid out a
> >> 'final salary' style of pension, assuming you kept up the monthly
> >> payments for your working life?
> >
> >Sure - mine does. The scheme was closed a couple of years ago, but all
> >contributions up to then are honoured exactly as promised. I have
> >about 20 years of contributions, which means I will be paid one-third
> >of my final salary annually from my retirement date. Those who have 40
> >years of contributions get two-thirds.

I was in a final salary scheme which closed to future accruals. That
means that my pension will be honoured when I retire, for the
contributions made up to the date of closure. But the "final salary" on
which my pension will be based is my salary when the scheme closed, not
when I retire.

By law, this "final salary" will be increased for inflation in the
interim (now in line with CPI rather than RPI, because of Government
changes). But this fails to take account of any other salary increases
that I might have expected, because of career progression etc.

The position of my final salary pension is thus as if I had left
employment by the company concerned at the date of the closure of the
scheme. (In fact I did leave their employment subsequently, but that's
a different story.)

In the private sector, I think that such closures of final salary
schemes have been very common.

>
> I've never come across such a scheme myself. I wonder how they stop you
> from artificially inflating your salary in the final year, to get a
> bigger pension?

I think they normally have a formula for determining your "final
salary", which actually takes an average over (say) the final three
years.

Bear in mind, too, that an artificial increase in your final year is not
in the employer's favour, so there is no incentive for them to do it.
Not only do they have to pay the increased salary, but ultimately they
also have to make up the resulting increase in the liabilities of the
pension scheme. That's likely to be much more.

--
Tim Jackson
ne...@timjackson.invalid
(Change '.invalid' to '.plus.com' to reply direct)

[BartC]

"the Omrud" <usenet...@gmail.com> wrote in message
news:gjh3s.734202$0b5.4...@fx28.am4...

No. Public sector workers would pay what they had been promised for apples
and bread.

Everyone else will now have to pay extra to subsidise the apples and bread
of those workers, *plus* they have to pay extra for their own apples and
bread!

And what also happens, is that a private sector worker who only buys the
basics, will have to pay even more extra, to finance the larger shopping
trolleys of well-paid public servants which are full of wine, cakes and
chocolate!

--
Bartc

[Roland Perry]

In message
<0d8c16a9-1fd2-4ed7...@gk4g2000vbb.googlegroups.com>, at
09:40:02 on Mon, 10 Sep 2012, Ste <ste_...@hotmail.com> remarked:

>> >How many headlines does it take, of top bankers, lawyers, and
>> >captains of industry going home with fat paychecks, whether economic
>> >times be good or bad?
>>
>> It's worth noting that salaries over 100k are something like 1% of the
>> population, and 250k+ less than half a percent. Makes a good headline
>> but is of little relevance to the ordinary person on an average income.
>
>Yes, but what share of the pie do those incomes represent?

Not very much, the 99% earning less still adds up to the majority of the
money.

>And more to the point, what about *unearned income* as oppposed to
>"salary"?

If you mean things like bank interest (I'm never quite sure why it's
either "unearned", or somehow bad, to have savings which pay interest)
then they'd be included in the numbers above (which come from tax
returns). [Yes, I know some people avoid tax]. Frankly, if someone is
earning 100k a year in bank interest, I'd expect them to be in the top
0.01%

>> Looking on the bright side, someone with that sort of income is very
>> likely to be employing people (nannies, gardeners etc) so it's not all
>> going on champagne and caviar. And expensive cars, which keeps people
>> who manufacture and service them in a job.
>
>I had this one the other day on another thread. If the money paid to
>the rich was paid to the poor instead, they would still be buying
>goods and services and therefore creating consequential employment -
>in fact, the poor spend a far greater proportion of their income than
>the rich, often spending 100% immediately upon receipt.

But perhaps the poor are spending their money on things that don't
create as much employment in the UK. Like imported Chinese goods, rather
than having the Merc serviced at the local garage.
--
Roland Perry

[Roland Perry]

In message <MPG.2ab7c9fbe...@text.usenet.plus.net>, at
11:10:02 on Mon, 10 Sep 2012, Tim Jackson <ne...@timjackson.invalid>
remarked:

>> I've never come across such a scheme myself. I wonder how they stop you
>> from artificially inflating your salary in the final year, to get a
>> bigger pension?
>
>I think they normally have a formula for determining your "final
>salary", which actually takes an average over (say) the final three
>years.
>
>Bear in mind, too, that an artificial increase in your final year is not
>in the employer's favour, so there is no incentive for them to do it.
>Not only do they have to pay the increased salary, but ultimately they
>also have to make up the resulting increase in the liabilities of the
>pension scheme. That's likely to be much more.

I'm not talking about pensions run by employers, rather the private
schemes run by Insurance companies for individuals.
--
Roland Perry

[tim.....]

"Roland Perry" <rol...@perry.co.uk> wrote in message
news:KTNLWyfU...@perry.co.uk...

> In message
> <0d8c16a9-1fd2-4ed7...@gk4g2000vbb.googlegroups.com>, at
> 09:40:02 on Mon, 10 Sep 2012, Ste <ste_...@hotmail.com> remarked:
>>> >How many headlines does it take, of top bankers, lawyers, and
>>> >captains of industry going home with fat paychecks, whether economic
>>> >times be good or bad?
>>>
>>> It's worth noting that salaries over 100k are something like 1% of the
>>> population, and 250k+ less than half a percent. Makes a good headline
>>> but is of little relevance to the ordinary person on an average income.
>>
>>Yes, but what share of the pie do those incomes represent?
>
> Not very much, the 99% earning less still adds up to the majority of the
> money.

A quick Google suggests that it's 14%, I hardly call that "not very much"

I doubt anyone expected it to be over 50%

tim

[Periander]

On 7-Sep-2012, jj22...@gmail.com wrote:

> There is some disquiet amongst my colleagues around new pension
> arrangements that will only apply to some members of staff (notably, not
> the union negotiating team).
>
> Consider two members of staff, who both joined on the same day. One is 39
> and one is 40, apart from that they are identical. Under the new rules the
> 40 year old will contribute less per annum and retire at 55 on a pension
> two to three times that of the 39 year old, who will only be entitled to
> retire at 67.
>
> This seems grossly unfair, but presumably it is watertight legally?

If you're talking about the new police pension scheme as appears possible
the bottom line is that the youngster is fucked and my best advice would be
for him to join the 1,000s of others and start looking for a new job now.
All the more so as it looks as though he'd need an extension to get a full
pension and extensions of service are not going to be granted in the
foreseeable future - specifically to prevent folks getting their pensions.

--

All the best,

Periander

[Periander]

On 9-Sep-2012, <m...@privacy.net> wrote:


> My scheme is independent from the state. For years we paid 7.5% and the
> employer a similar amount. After a certain female prime minister came to
> power it was deemed the scheme was in surplus, and contributions dropped
> to 4.5% and the employer had a contribution 'holiday'.

Yes, I remember it well on the one occasion I had drinking T with Mrs T, she
made a specific point of saying how the change in the pension rules would
fuck off all the people who voted for her, gosh we had such a giggle over
that.

No sorry the old "It was all Mrs T's fault" doesn't wash. The reality is
that the government made changes to the rules to permit what you describe
above to take place, they didn't make the changes themselves. The trustees
of your pension fund made those changes and as you describe it would appear
that they were incompetent. of course you could have changed your trustees
but again it would appear that you didn't ...

Now if you really want to take a peep at the government who actually took
money from pension schemes (rather than as Mrs T did and empower them to
make their own choices) you may wish to look over your shoulder to the
recent past when both Blair and Brown asset stripped the entire country.

[Periander]

On 9-Sep-2012, Phil W Lee <ph...@lee-family.me.uk> wrote:

> Allowing for inflation, that is less than at the end of WW2.
> You know - that time when we INCREASED state provision for the
> disabled.

Yadda yadda yadda ... at the end of World War 2 the railways were still
privately owned, likewise the steel industry, the mines, the road haulage
firms, the aircraft and ship building industries, the electronics industry
... within 10 years they would all be taken by the state and used as sumps
to take in surplus workers, intentionally run at a loss and closed creating
the massive unemployment se see today. Compounded today by around 10 million
migrants that have to be fed out of the public purse ... the country's
utterly fucked ...

[Yellow]

"the Omrud" <usenet...@gmail.com> wrote in message
news:gjh3s.734202$0b5.4...@fx28.am4...

Or they could drop wages, reduce staff and/or reduce the pension benefits
for new workers.

> Doesn't seem much different from teachers or tax inspectors.

It's not, or at least it shouldn't be, and that is exactly the crux.

If a commercial operation makes promises to staff that it can no longer fund
they have the choice, other than to make different promises, to charge more
for their goods or to reduce their costs.

Charging more for goods might work for a monopoly organistation but in a
competitive marketplace, there is only so much that can be charged and over
pricing will lead to people taking their money elsewhere this path can
therefore only be travelled so far. By comparision, up until now, the
funding to the public sector was just increased from taxes or borrowing
apparently without limit because there is no limit other than someone saying
stop or the country going bankrupt.

[Yellow]

"Percy Picacity" <k...@under.the.invalid> wrote in message

news:5uf620....@news.alt.net...
On 2012-09-09 11:30:02 +0000, Yellow said:

> In article <5uedam....@news.alt.net>, k...@under.the.invalid says...

>>
>> On 2012-09-09 08:25:02 +0000, AlwaysAskingQuestions said:
>>
>>> Percy Picacity wrote:

>>>> On 2012-09-08 14:15:02 +0000, steve robinson said:
>>>>

>>>>> jj22...@gmail.com wrote:
>>>>>
>>>>>>> seem exceptionally large. Dare I ask if you are sure there is not
>>>>>>> a "tapered protection" which means the difference is less stark
>>>>>>> than you think? (There is eg for the police scheme reform which
>>>>>>> has been in the news but I am of course making no assumption or
>>>>>>> suggestion about that being the scheme in question).
>>>>>>
>>>>>> My information is gleaned from people working out the effect on them
>>>>>> using the worked-examples provided by the union, so there are many
>>>>>> potential sources of inaccuracy, yes.
>>>>>>
>>>>>> ...but that's still not addressing the age-related question.

>>>>>
>>>>> The issue is given we are all living longer can you expect to retire
>>>>> at 55 and recieve a lump sum payout plus a pension of around 2/3 your
>>>>> income for the next 30 years index linked
>>>>

>>>> If you have paid for it in terms of large chunk of your salary and
>>>> contracted to receive it then why not? Building contractors
>>>> generally expect to receive the amount they have contracted for, not
>>>> 30% of it because the customer finds it a more convenient sum to pay
>>>> after the work is completed.
>>>

>>> If the customer goes bust then the contracter may be relieved to get as
>>> much
>>> as 30%.
>>
>> True but irrelevant: the rich 1% in our society are doing very nicely,
>> thank you: nowhere near *bust*.
>
> Yes we could, as a country, help ourselves to everyone's personal wealth
> and I guess that would last a few years. Then what?

That was not my point. The fact is we are not so badly off as our
rulers pretend. And they are mismanaging things for short term profits
for their friends.

-------

You beleive that the economy is being deliberately "mismanaged" - which I
guess means manipulated and well managed - so as to produce profits for
particular individuals at the expense of everyone else?

I'd be impressed if it is, so I'd be interested in your evidence for that.

[Yellow]

"Phil W Lee" <ph...@lee-family.me.uk> wrote in message
news:g36q48tof04v0skkt...@4ax.com...
> Yellow <no...@none.com> considered Sat, 08 Sep 2012 21:30:02 +0100 the
> perfect time to write:
>
>>In article <BmL2s.380245$Uc7....@fx07.am4>, john.b...@ntlworld.com
>>says...
>>>
>>> On 08/09/2012 15:35, Yellow wrote:
>>> > In article<n5H2s.365100$c01.3...@fx01.am4>,
>>> > john.b...@ntlworld.com
>>> > says...
>>> >>
>>> >> On 08/09/2012 12:35, Yellow wrote:
>>> >>> In article<q3F2s.309770$Xu5...@fx10.am4>, john.b...@ntlworld.com
>>> >>> says...
>>
>>> >>> I am on an average wage and therefore pay around 6 grand a year in
>>> >>> tax
>>> >>> and national insurance. Say I work for 40 years on that wage (crude
>>> >>> maths I know) that's 240 grand in a life time. To support a million
>>> >>> pound pension pot it is going to take more than 4 of me without any
>>> >>> of
>>> >>> our monies paying for anything else like health care or our own
>>> >>> state
>>> >>> pensions - so someone else's tax (or more borrowing) is going to
>>> >>> have to
>>> >>> be supporting me as well as themselves in those areas too.
>>> >>>
>>> >>> Crude maths as I said, but it gives a perspective.
>>> >>>
>>> >>> Still think these pensions are affordable?

>>> >>
>>> >> And how, precisely, does your position differ from a public-sector
>>> >> worker on the same salary?
>>> >

>>> > My position is different because my wages and pension is paid by
>>> > "wealth
>>> > generation", and are therefore not just a cut of someone else's income
>>> > or from borrowings.
>>> >
>>> > I cannot believe that there are still people who do not understand
>>> > this.
>>>
>>> As most "wealth generation" was (and probably still is) done by banks,
>>> those people would be justified in their perplexity.
>>
>>Whatever. My wages however are paid by adding value to goods, otherwise
>>know as manufacturing.
>
> And an NHS worker's are paid by adding value to people, otherwise
> known as health services.

You are perhaps confusing well-being with the the financial wealth of the
country? But anyway, this a support service, paid for by the wealth
generated by the private economy.

>
> Or to take a completely different example, do you really think that no
> value is added to a building that conforms to building standards, and
> can be shown to do so?

No, the country's financial wealth in not increased by someone checking that
a building is safe.

>
> DO you think that no value is added to a factory or warehouse by the
> transport infrastructure that allows them to them to move goods and
> raw materials in and out?

No, transportation does not add financial wealth - it is a service paid for
out of the wealth generated by the manufacturing process.

[Yellow]

"Phil W Lee" <ph...@lee-family.me.uk> wrote in message

news:rn5q485ef8rpknok6...@4ax.com...
> Yellow <no...@none.com> considered Sun, 09 Sep 2012 12:35:02 +0100 the
> perfect time to write:
>
>>In article <5uea3e....@news.alt.net>, k...@under.the.invalid says...

>>>
>>> On 2012-09-08 23:40:02 +0000, steve robinson said:
>>>
>>> > Percy Picacity wrote:
>>> >
>>> >> On 2012-09-08 18:35:02 +0000, steve robinson said:
>>> >>
>>> >>> Percy Picacity wrote:
>>> >>>

>>> >>>> On 2012-09-08 14:10:03 +0000, steve robinson said:
>>

>>> >> Well, is it not part of that contribution to GDP which is ultimately
>>> >> paying for their pension, regardless of whether they are paid out of
>>> >> a firm's costs or out of taxation? That is the sleight of hand in
>>> >> your argument which suggests that other people have to pay for their
>>> >> pension. Just as it is the profit on a private sector worker's
>>> >> production of widgets which is paying for his pension, it is the
>>> >> added value to society by, say, a doctor or police officer which is
>>> >> paying for their pension.
>>> >
>>> >
>>> > The point is any added value is notional the product they create as no
>>> > resaleable value it adds nothing to the public purse no profit.
>>>
>>> With respect, that is simply not true. Being able to take the factory
>>> wages from the bank without paying half to a gangster is added value:
>>> half your workers not having chronic diseases that reduce their
>>> productivity adds value.
>>
>>Does it add financial value or is the factory owner in fact simply
>>receiving what he is paying for?

>>
> Nearly all private sector business would go bust if they had to pay
> the full cost of what they receive from the public sector.

But, together with the country's borrowings and taxes on people's personal
wealth, they do pay the full cost of the services they receive from the
public sector.

But out of interest, who do you think pays for it?

[Stuart A. Bronstein]

"Yellow" <ye...@please.no.spam.com> wrote:

>>>Whatever. My wages however are paid by adding value to goods,
>>>otherwise know as manufacturing.
>>
>> And an NHS worker's are paid by adding value to people,
>> otherwise known as health services.
>
> You are perhaps confusing well-being with the the financial
> wealth of the country? But anyway, this a support service, paid
> for by the wealth generated by the private economy.

The country's general well being contributes greatly to its
financial well being. When experienced workers get sick, the
companies they work for are less effecient or have to pay more
money to produce the same goods, for example.

>> Or to take a completely different example, do you really think
>> that no value is added to a building that conforms to building
>> standards, and can be shown to do so?
>
> No, the country's financial wealth in not increased by someone
> checking that a building is safe.

Perhaps not in a very limited sense. But if no building were
checked and many fell down, that would have a huge negative impact
on the wealth of the country.

>> DO you think that no value is added to a factory or warehouse
>> by the transport infrastructure that allows them to them to
>> move goods and raw materials in and out?
>
> No, transportation does not add financial wealth - it is a
> service paid for out of the wealth generated by the
> manufacturing process.

If there were no transportation there would be little or no wealth
creation. Saying that transportation adds nothing is very short-
sighted.

___
Stu
http://DownToEarthLawyer.com

[the Omrud]

On 10/09/2012 09:45, Roland Perry wrote:
> In message <ohh3s.734201$0b5.5...@fx28.am4>, at 09:15:03 on Mon, 10
> Sep 2012, the Omrud <usenet...@gmail.com> remarked:
>>> Was there (Equitable Life aside) ever a private scheme which paid out a
>>> 'final salary' style of pension, assuming you kept up the monthly
>>> payments for your working life?
>>
>> Sure - mine does. The scheme was closed a couple of years ago, but
>> all contributions up to then are honoured exactly as promised. I have
>> about 20 years of contributions, which means I will be paid one-third
>> of my final salary annually from my retirement date. Those who have
>> 40 years of contributions get two-thirds.
>
> I've never come across such a scheme myself. I wonder how they stop you
> from artificially inflating your salary in the final year, to get a
> bigger pension?

They can't, but it would have to be connived by senior management, and
the employer would be liable for the shortfall so caused.

> It's all very well for a company scheme, where people are on a pretty
> well defined career path, but for someone effectively self-employed like
> myself[1], I could save up my wages for a couple of years and then pay
> it all out the final year!
>
> [1] Not in the tax/NI sense, but I'm a director of a very small company
> so what I pay myself as salary is at my own discretion, although there's
> corporation tax to pay if I don't take all the profits as salary.

Well, that's the point. It's not the career path, but the number of
participants. Final salary pension schemes only work with a large
number of members: past, present and future.

If, as has now happened in the vast majority of cases, the scheme finds
itself short of sufficient money to pay future liabilities, the employer
has to fund the shortfall. My employer is doing this in scores of £m
each year. If the employer can't afford the liability, it becomes
bankrupt and the scheme has to pay out what it can.

--
David

[the Omrud]

On 10/09/2012 11:10, Tim Jackson wrote:

> I think they normally have a formula for determining your "final
> salary", which actually takes an average over (say) the final three
> years.
>
> Bear in mind, too, that an artificial increase in your final year is not
> in the employer's favour, so there is no incentive for them to do it.
> Not only do they have to pay the increased salary, but ultimately they
> also have to make up the resulting increase in the liabilities of the
> pension scheme. That's likely to be much more.

I think that's a recent invention. All the schemes of large companies
which I'm aware of had a real final-salary formula until 20 years or so ago.

--
David