Stop lying about public sector pensions, say striking teachers

The goverment pays far too much for certain public sector grades ,60k to 100k plus for school heads and deputies plus GPs and of course the vast army of senior managers etc etc not to mention the infamous local goverment lot......

Final salary pensions where never meant for these levels of pay but of course this goverment will fudge any issue that it can. they are totally spineless ,a bunch of make it up as you go along college boys..

A nice piece of balanced journalism from Lorna.

Of course public sector workers should have enormouse pensions......... as long as they pay for them out of their own pockets like the rest of us. This must also apply to MP's pensions but we hear nothing of this from our representatives. I wonder why?

I am fortunate. I have a good private sector job an on above average salary.

The question that is NEVER put by anyone in the media to Union bosses and public sector workers is;

How much more should I pay in tax and NI to fund their pensions?

My P60 is already showing 7k tax + 3K NI. My council tax is another £1300 How much more tax do Union bosses think I should pay? Another 500? another £1000 another £2000?

Come on tell me, how much more?

Come citywire, get Bob Crow on the phone and ask him how much more tax should I pay?

Am I also right in thinking that members of these final salary schemes pay reduced rate NI because they are contracted out of S2P? I could accept this if the scheme was only providing a benefit similar to the S2P benefit given up, but the benefits accruing are much more generous! So they get a benefit partly funded by my tax and pay lower NI than me for it.......I'm just jealous I guess!

What is wrong with taxpayers funding public service pensions? That is, partly what taxes are for. We pay for their wages. What is wrong with paying for their pensions as well? Whether the taxpayer can afford to pay them is a purely subjective decision, based on a consideration of what else you would rather spend tax funds on. Perhaps you would like to live somewhere where taxes are low, public servces are poor, and everyone, but the very rich, lives in fear of getting old and being cleaned out, financially, by the rapacious private sector "providers" of health care. Like the USA. I'm sure the Tea Party nutters would provide you with a suitable audence.

We have gone from not affordable to not fair. Is it fair that for the decades that these schemes were in surplus teachers pension contributions (and NHS as it happens) subsidised taxpayers? The governments kept the surpluses in these schemes. Is it fair that state employees contributions have been used to subsidise benefits and top ups for those whose employers in the private sector took contribution holidays, etc.

The justification for these cuts are based on untruths and an attempt to split the public and turn them against the public sector and public services. The reasons are ideological not financial, nor are they honourable. The full truth will out and the public sector should make sure that the truth is heard.

If we look back, Public sector received good benefits because their pay was low, and by offering a good pension was offsetting this cost into the future. Then the public sector started to campaign for better Salaries due to their private counter parts earning more. So this meant Taxes increased, private pension schemes changed and now the tables have turned, The average Public Salary is the same if not better, and they kept their benefits. So now a lot of the private sector cant afford a pension because they are funding someone else’s. I think some pensions need to change and Teachers is one of them, I know a lot of teachers and with their hours and holidays already get a good pay for what they do! On the other hand nurses for example who work 60hr weeks I think deserve more of a pension compared to teachers.

The public sector needs to bite the bullet like the private sector has done!!

There's been much unbalanced discussion in the media - not least by one of the heads of a union (I didn't catch her name) who was berating the Government for not explaining the amount of deficit currently in the TPS - making it impossible for her to negotiate.

Having previously had a role involved in dealing with the managers of LGPS and a detailed understanding of the TPS I was somewhat surprised given that the TPS is unfunded and therefore her comments were, essentially, nonsense.

Michael Gove set this straight later on when put to him in a different interview but the interviewer seemed to brush that aside rather than focus on the fact someone heading up the calls for strikes appear to misunderstand the essence of the issue she's calling a strike over!

Over 8 years ago, I'm fairly sure that there were LGPS employers making Employer contributions of 18%+, add to this the Employee (5/6% then) and we're already looking at a cost of nearly 25%. This is before 'austerity', 2008 correction, Hutton etc.....

How many employees in such schemes appreciate this (arguably hidden) cost? At the time, some LGPS employers we toying with the idea of putting their pension contribution on the payslip to raise awareness and appreciation though I'm not sure if that eventually took place.

Ultimately - yes, the cost of these schemes could be met - but what is the opportunity cost of meeting it?

Yes the proposals are to ask the members to work longer, pay more and have salary average but what's the alternative?

Incidentally, they don't have to work longer, they just need to plan in case they rchoose to etire earlier before their pensions commence.

I'm also assuming the plance will not be retrospective??? I'm sure I've seen that somewhere yet that seems to be glossed over by the press too.

As most are aware, these schemes are effectively like asking an employer to write a blank cheque given that the cost of future liabilities can't be certain. All of the risk, cost and undertainty is on the employer/scheme.

The public sector is relied upon by the nation and let's be honest, they deliver many services we all rely upon. That doens't mean, however, that they are entitled to benefits far in excess of a private sector employee in a role with similar responsibilities.

Moving to a Defined Contribution would solve a lot of the issues but I can't see that being a solution that would be accepted and therefore 'we are where we are'.

As a finally, as a parting shot, my wife is a teacher - we will 'lose' something here but given that I broadly understand pensions, notably DB etc, I aren't screaming from the rooftops, I'm quietly getting on with my day job whilst looking forward to when (in 25+ years time, or is it 28 now!?) my GPP will begin to pay me my unknown and uncertain retirement benefits!

The government's concern about the impact of a day's closure would have on school children was interesting. For school kids it was the third extra day off this year. The first one was when the government wasted millions of our money on an abortive referendum, when far more schools than yesterday had to close to be polling stations. The second was for the Royal wedding. It's a shame no one remembered to worry about the kids education then.

Antonio,

No one is suggesting taxpayers shouldn't fund public service pensions. The question is how generous those pensions should be. The vast majority of us are going to have to work longer before drawing a pension and public service workers cannot be immune to this. For me, retirement age has to increase in the public sector. However, I do think this should be phased in gradually as it is completely unfair to shift the goal posts for those about to retire.

It's all about trust and moving goal posts.

I made a decision to go into teaching based on the terms and conditions at the time. The pay is not good compared to other professions (lawyers, GPs etc.), but if I worked hard I would eventually become a head teacher and with a pension based on my final salary I would be comfortable. After paying in for 15 years I find the terms and conditions are being changed. Firstly, the pension would be based on the final 10 years rather than final three years and now based on the career average - quite a difference between a newly qualified teacher and headmaster.

Do I need to bail out now? What's to stop the next government basing the pension in my initial pay?

Why don't Teachers ever protest in August?

Like I was trying to say on Question time last night....

The labour movement in private sector is largely unrepresented, therefore public sector unions set the standard for representation for those that have sadly been muted. UK public sector pensions are amongst the lowest in the OECD. Thus the real debate should be focusing on 2 decades of failings in private sector provision. It is irresponsible of the Government to create divisions between private and public sectors....We should be raising the quality of all pensions in society and avoid socialising the losses of private risks.

@Teacher

But when you choose your occupation, your investigation of the available pension would have indicated how long your tax payer funded retirement would have been.

Now, due to longevity, you will be retired for a longer period. (if provide your date of birth, and date of joining, I'll work out much longer your paid lesuire will be).

Using your logic, why don't you remain in work for the increased amount of your anticipated life expectancy?

@Teacher

In the private sector, we have had a choice just like you have, our benefits change/pensions closed/capped or possibily lose everything by being made unemployed. Also why not take up a part time job during your holiday which is about 12 weeks year compared to everyone else who gets 4!

The comment is so like a Teacher,I worked with Teachers and a lot of them have no idea on how the real world works.....

Well there is no surplus now Chris.

Look at the maths, if a teacher earned an average of say £30,000 for 40 years, the contribution would be £60,000 at 5%.

To retire on two thirds pay, You would need a cash pot of £300,000 at 6.5% annuity rate.

So who pays for the other £240,000 part of the pot.

Teachers get much more time off for holidays and many retire early due to stress. They shoud try the stress in the real would of industry.

Interestingly the more retired people in society then the greater availability of voluntarism.

Older people are hugely valuable in terms of wisdom and knowledge. We are living in a knowledge economy. A few hours a week is enormously beneficial both the the beneficiaries and benefactors of social projects. In this case the core economy could grow as a result of the baby boomers who have benefited from 3 decades of growth and the so called I.P.O.D generation (Insecured, pressured, overly taxed debt ridden could be supported.

The recent gravitation of wealth redistributed from the middle classes to the super rich means there is a reduction in the middle classes. However for the economy to grow we need to rebuild the middle classes.

So my message is to the silver servers who benefited from free higher education, mortgage interest relief, safe (r) jobs, final salary and defined benefit pension schemes to come out of your house and contribute a few hours a week to rebuild the social capital in your communities and show the younger people what a democratic and socially responsible society could look like.

Teacher

The Government is not changing the conditions of the pension you have acrued these are secure. What it is proposing is that future benifits will be different and is trying to renegotiate. This has happened in private industry over the last 10 years and you have an option either reach an agreement or find somethingelse to do. No fifferent to salary negotiations!

BTW Brown and the labour government in one foul swoop took billions out of private sector pension by changing the tax laws and there was no negotiation at all!

If you have a Head's job you are lucky, its well paid (note I'm not saying its undeserved), 12 weeks holiday and a still a DB pension scheme. Try and find something better in the outside world!

No idea how the real world works, eh? Would that be the "real world" of the financial services industry which fleeces its customers on a regular basis? Like my endowment policy fund, which is currently producing an average annual investment return of just over 3% on maturing policies, while inflation over the 23 years I have been paying in has been a bit over 5% RPI? Oh, and let me point out another thing. Public secto staff DESERVE higher wages and pensions than those in the private sector. Why? Because on the whole they are significantly better educated.

Lets borrow a few more trillion to fund the teachers pensions. The kids they occasionally teach can pay it all back...

Apologies for the missing "r".

I have to laugh Antonio, real world, savings percentage is driven by the strenght of the economy, if you understood this when you took out your endowment policy you would have known, that there is always a risk with investment if the economy goes down.

With regards to the public sector being better educated what a load of rubish, I worked in and with the public sector for many years as well as many friends, the general feeling was, they could not get a job in the public sector. Just look at how these departments are being run, many are burning through money like no one's business, and yet again they are being force to restructure! Why because they can figure it out themselves that what they are doing is not efficent. If they were better educated surely these issues would have been addressed, and the government wouldnt be worrying about how to bail the public sector out. It is a sinking ship, hence why the governement needs to change things!!!

@ Teacher (as an ex teacher)

Yes, you joined when conditions were less favourable, 15 years ago. Even so you found the pay acceptable at the time for the work expected of you.

The past 15 years has seen a significant rise in pay for all teachers, with many 'threshholds' and lately more opportunity for extra responsibilities. I wouldn't be surprised if your gross pay has doubled in that time, even if you are still 'only' a teacher and still on a 100% teaching load i.e. assuming you have not moved into 'management' with even better pay scales. If you look back, your prospective pension will have increased in line with your salary.

So are you rejecting all these 'changes in conditions of employment' too? No, obviously not. You are still a teacher.

After a golden period of improving benefits, the big world conditions have changed and you, too, have to face your conditions changing slightly for the worse. But at least you still have a good job, excellent pay, a guaranteed pension that is better than almost anything in the private sector.

You and the entire teaching profession should be quietly thanking your lucky stars and teaching children by example to accept the rough with the smooth, not go to extreme sanction (strike) so unintelligently, blind to the world around you.

@Anonymous1 - there are two things at issue here 1/ the pension payouts are not related to what was put in, i the sense there is no "pot" of cntributions + returns - the provider pays out according to the formula, from what he receives in. And 2/ there is no individual pot of course either. So what ou are asking for is not possible. Do you want to change the system, and have individual accounts for each employee? If you do, you are quitting the final salary method and going for a market method. If you do that, there'll be blood on the streets when all the savings are wiped out and blood again when (highly improbable) civil servants are seen rolling around in fast cars on the money they've made from their investments

I don,'ttrust the Government Actuaries assumptions as earlier this year under the Freedom of information Act I asked them why the cost set by them to purchase some additional pension under a local government pension scheme purchased by the employee was about 30% cheeper than if it was purchased in the open market. They were unable to give me a satisfactory answer. So because it was being purchased directly from the local government pension scheme it was being partly subsidised by them.

All public service schemes should be made to show in their pension accounts what it would cost on the open market to purchase their pension liabilities and not the assumptions used by their own actuary or government actuary

I agree that final salary schemes were not intended for very high earners. I worked in private industry and back in 1994 my employer capped pensionable salary at £60k this saved them a considerable amount as wages increased over time. Then in 2000 the final salary scheme was scrapped for new employees. From a workforce of 40000 they now only have circa 9000 still in the final salary scheme. The public sector workers have to face the reality of the situation and understand that often as in the private sector benefits and conditions have to change based on affordability.

"Laugh"? Thank you for demonstrating, in one word, the loathsome cynicism of the financial services industry, which sees everyone else as just so many mugs to be fleeced, while you pocket your undeserved and unearned bonuses. And yes, public sector staff ARE, on average, better educated than those in the private sector.

This country needs to put every civil servant and public employee onto a self employed basis for three years. If they dont work they dont get paid. If they are ill they get peanuts to live on. Treated like criminals and constantly harassed by new legislation. Never knowing where the next days money will come from. I have been self employed for over forty years and have been fortunate to have earned a living. I choose to do what I did because I wanted to. I dont bleet on about how if I was a teacher I would earn so much more than I do for less hours less work more holidays fantastic pension funded out of someone elses pockey. From today each government employee should be given the opportunity to get the superior benefits available in the private sector, to that which they are enjoying now. SACK THE LOT

They should think themselves lucky to have jobs and stop moaning! They should think themselves lucky to even get pensions given to them and that their pensions have no link to the performance of the wider economy, unlike most normal pensions.

One of the huge benefits the public sector employee enjoys is the ability to retain all their pensionable service benefits whenever they change employers within the public sector, as well as the pensions being index-linked.

In the private sector when changing employers the pension benefits from that employment is usually frozen until retirement age is reached, and the pension eventually paid is based on the earnings with that employer and length of service. It is seldom possible to transfer the full value of the pension benefits into a new employers pension scheme. As on average people in private sector will work for nearly 10 employers during their lifetimes they will have accumulated several, fairly insubstantial, often non index-linked pensions, on retirement. This pension will be far less than would have been achieved had they managed to stay with one employer for the whole of their working lives (as is the case with many public sector employees).

@easy life

The conditions regulating accrued pensions are not "secure". Workers will be working for longer, spend less time in retirement, they will pay at least 50% extra in pension contributions and the pension received will be upgraded each year by reference to CPI not RPI.

Antonio - I support a lot of your comments but your remark...

"Public sector staff DESERVE higher wages and pensions than those in the private sector. Why? Because on the whole they are significantly better educated."

...might or might not be true. However THAT'S no reason to pay people more!

Oh, lest I forget, Teacher, where would you get a better job (at your age and with your experience) in the private sector?

CPI is a joke as it doesn't take in to account housing costs. It would be fairer if linking actually took account of individual circumstances...thus if you are not paying housing costs then link to CPI, for those who are paying housing costs then link to RPI.

Housing costs = Rent or mortgage only.

How about not giving them a pension at all and leaving them to invest their own income in a pension. That is how things are me.

@tough enough

Good point about the skewing of benefits by the very high pay of some public service employees. My son's university's vice-chancellor gets a comfortable salary of something approaching £300,000: he also got a 9% salary increase this year - when university lecturers are facing a second year of zero adjustment to pay. That's a pay increase of £27,000 per annum for the chap in a silly hat on graduation day, £0 for the people teaching my son, and a stonking increase in fees for students.

By pure coincidence of course, the guy is a couple of years away from retirement, so that the pay rise will fuel an increased final-salary pension throughout his years of dotage.

@ Jonathan Cleaver

CPI is no joke - it might not include housing costs, but it does include stock-broking fees :)

Can somone tell me if the proposed changes are for future service only or if it also applies to service before the change date,

Antino

I agree some of the financial bonuses are undeserved, this being manily the people at the top who make the wrong decisions, and some of these people should not be in a job. However what about the poor mother of 3 who works in a bank behind the till, who is doing what she is told, works hard offers the best service she can. She cant quit due to the job market, why would she not deserve a bonus?? Again you a proved a my point about the real world, its something like 5% of employees in the financial sector who are on large pay checks and bonuses, 60% are around the 20K mark!

Lorna & Victoria are parodies of smugness in their rush to put a gloss on government policy.

Actuaries did not get the increase in longevity "wildly wrong", they got it right, but nobody listened. Understanding that life expectancy is on the increase is not a difficult trend to spot.

Any difficulty in predicting longevity is taken care of by sensitivity analysis. This leads to the spread of future values seen in the chart our ace reporters reproduce in their piece.

@Philip - you are on a cash balance plan and they are on defined benefit plan. Endowment mortgages were heavily pushed at one time - they promised returns that would paty off the mortgage and then some and this because the loan was invested in stocks and shares. The markets seemed to go on forever. The private sector converted to portable pensions, invest in stocks and take your pension fro job to job nd the employers all do their bit.

But now "the West" is in ruins, while those countries who lived within their means are doing OK. Similary, people who took out pension plans are ruined, and only the DB schemes (which seemed so cautious at the time because state workers accepted lower pay in return for better conditions) seem to have held up.

Whatever your point of view, it seems that all are agreed that individual citizens should pay for this financial crisis. Never mind the obligations employers entered into or the growth assumptions purveyed by pension salesmen. Never mind the idiocy of democratically elected politicans. Never mind the bankers and their bonuses. For these people are the real liars. And by accepting an argument that questions entitlement to pensions, we are letting them off the hook.

Cape Town. Small (but important) point.

"the growth assumptions purveyed by pension salesmen."

It's NOT the pension SALESPEOPLE who make up these (often) mythical projections. It's the pension COMPANIES!

Just to set the record straight, you understand.

Antonio - If you have any evidence for your assertion I'd love to see it - I doubt you have any other than your personal biases. As someone who has worked as a university lecturer and in industry and voluntarily in the charity sector, i would certainly refute your assertion!

Without degrading too far into teacher bashing I cannot help but recall that, when I was coming to the end of my school days, there was an oft quoted joke that went along the lines of ' .... if you can, you get a job, and, if you can't, you teach!' Oh and that was over 40 years ago - I doubt standards have improved since. While I would add that I know plenty of good teachers I would add that I also met some of the idiots out for a jolly at Chancery Lane tube station yesterday! My impression is that they are now seriously losing the debate and public support.

Hopeless romantic

Sorry but benifits already acrued are secure-read the proposals including when (retirement age) you can take the acrued pension benifit! Of course you will need to work longer and pay in more because by living longer you will be getting more out! This is the whole point which most public works seem oblivious to!

The longevity question is bogus. The 2007 deal under the Labour government means that, if average longevity of teachers exceeds the government's forecast, they will make extra contributions or receive lower pensions. Hence the changes the government is proposing are not about affordability, they are simply to free up cash for the rest of the budget.

So, when the people in the private sector have stopped jumping on the Daily Mail bandwagon of "us and them", driven home in their company cars, investigated their company share option valuation statement, booked their company financed private healthcare treatment and grumbled about their mediocre pay rise and lousy bonus, they may perhaps spare a thought for the public sector employee who has had non of the above employment packages - including 0% pay rise. Try and absorb what Jonathan Cleaver is attempting to say about raising the bar for everybody and, above all, take ALL of the factors into consideration rather than such divisive "us and them" retoric. In fact, just leave the distortion of the facts to the government ministers and spokemen being wheeled out at the moment (who are keeping Mum about their own pensions) and perhaps ask them why we are all having to pay for the bankers' collosal cock-ups which are still being rewarded with huge pay rises and bonuses. Oh, and by the way - how much was the average company director's salary rise last year (then add the bonus)? Hypocracy or what??

Nebat

Unfortuneately it is them and us. Us who are paying, them who are recieving, thats why we are upset!. However I agree we should be raising the bar and everyone should get good pensions, but who exactly is going to pay for them? This is the problem we are broke as a Nation and getting poorer due to the last governments excesses and head in the sand attitude.

I did not see Joathan cleaver come out and defend private pensions when Gordon Brown raided the savings and destroyd the pensions industry or when Equitable pensions were wrecked and for that matter I did not see the public worker say anything or the trade unions. Revenge is sweet.

Here is the evidence. The government's Labour Force Survey has shown that in 2009, 39% of the public sector workforce had degrees or equivalent; just 20% of the private sector did. 14% of public sector workers had some other higher eduational qualifications, just 8% of the private sector did. Uncomfortable reading for the politics of envy brigade who think you are worth nothing unless you are selling the public snake-oil financial "investments" for a living, but those are the facts. So public servants DO deserve better wages and pensions. They are better educated and that is their justifiable reward.

The productive private sector would have to provide a smaller subsidy to the public sector if that had not been bloated in numbers by the last government. The growth in the economy comes mostly from the private sector. Reduce the size of the public sector again, and all the sums become easier. Of course that is why the unions fight against any attempt to bring private enterprise into eg the NHS.

Easy Life

Of course there is some, very limited, maintenance of the promised pension: but the overall, slow erosion of the pension throughout retirement as it is upgraded by CPI as a measure of inflation will cost public servants dear, as will the eventual switch to career average rather than final salary.

Sorry Normski! I was only about 20 at the time and had little interest in pensions, or savings for that matter - as most young people at the time I was enjoying my youth while that time was precious. That's no reason we cant build a direct democracy now and work together to take back parliament for the people and try to reintroduce some fairness. Why should former merchant bankers and the boys and girls of stockbrokers gain all the power and influence.

Personally Iv'e had enough of these socially constructed realities and want to do something to expose the myths. Not easy when Murdoch is consolidating BSKYB into NewsCorp. Aunty (beeb) does not help...I noticed there was no mention of Corporate tax reform on PM last night which evidently intends to make the UK into a treasure island. Obviously a reduction of corporate tax is good for UK PLC, but it will mean a reduction in jobs in UK. Moreover why should the multinationals take a Tax Cut when the rest of us are paying more in terms of VAT / NIC's

May I take this opportunity to warn the reader that not everything is as it seems and recommend you to aggregate news from a variety of sources.

Rob Walker

For the same reason private sector workers never have one day strikes at weekends. Doh!

Antonio - I wonder what the agenda behind that particular (Labour) government study was? I'm happy to let you live with your assertion - I'll live by mine! Regardless, and as pointed out earlier above, the level of education has got very little to do the level of wages or pensions that is either deserved or justified! To throw another >40 year comparison in - do you think the quality of nursing back then (when nurses spent around 3 years training on the job/paid less than a univ student) was better or worse than now when many have gone through a full-time nursing degree course? Moral of this : personnel quality/job performance/dedication (as well as supply and demand) should determine rewards not just education.

ps care to throw your degrees into the ring against mine?

Hopeless romantic,

Yes CPI is less than RPI (in the private sector we will have the same. But it all boils down to the same thing, because people are living longer people are taking more out of their pensions. Yes stay with RPI but then you will need to put more in!

Antino

Do those facts show that a large majority of the public sector jobs need a certain degrees, ie doctors, nurses, dentists etc.. Also the private sector has a larger range of industries! And a lot of these do not require degrees. So why not re look at the results comparing the private to the public on a like for like basis...... Private medical care, private education etc then tell me the figures!!

Again, I am speaking from experience in Public and Private sectors, so I have seen both sides, and this is what I am basing my arguments on.

Just because someone has better education, that is not a basis to decide how much they are worth, why is graduation recuritment so low? Because employers will rather take on someone who has done the job before then someone who got a certificate studying it!!! Again brought up recently due to the rise in tution fees are degrees actually worth anything!!

If we accept that this it is a question of fairness then we can either guess what the majority consider to be fair or hold a referendum. Guessing really isn’t good enough even if we try to dress it up as something more sophisticated, so the logical thing to do is hold a referendum.

Having worked in both for several years ;Public smarter than private???

The vast majority would not last five minutes in the cut and thrust of real business life-they would be off long term sick with stress or become a union rep.

If Cameron loses his nerve in bashing these lead swingers god help us all.

Many of the above comments illustrate the problem with trying to make sweeping generalisations. I would also agree we need to get away from the us and them rhetoric. Nor should we be denigrating the public service as a group. My recent experience in dealing with both the private and public sector is that there are problems in both areas and in fact in my own league tables the employees of HMRC and the Work and Pensions department are winning quite convincingly in their knowledge and helpfulness.

I think that there needs to be some acknowledgement of salary levels. Final salary schemes protect the lower paid and maybe the way forward is to continue these up to a certain salary level. If you get promoted beyond the final salary benefit gets locked for the first part of the salary and then there is a defined contribution scheme for the rest of the salary. The employee could also contribute and could choose what percentage he wanted to put in each year depending on his circumstances. In my final years of working I was sacrificing approx 25% of my salary in order to build up my private pension.

Of course there would be a lot of negotiation about the contribution to be made by HMG but I do not think it is sensible to pretend that some earning £86000 (average salary of a headmaster according to Hutton) needs the same help to provide for their old age as some one earning £21000. After all they already have the advantage of the higher wage.

Has Lorna Bourke got it wrong? I understand that the figures in the Hutton Report are based on the assumption that his recommendations (about which the teachers are striking) have been accepted and included in his projected figures. I would like to know if I am correct as it means the basis of this debate is completely up the creek!

Mr Trick - Teachers pay in 21% of their salary to the pension fund. (6.4% from salary, 7.1% LEA, 7.1% Government). This is and was part of their conditions of service, a contract. Over 40 years this is equal to 8 years salary. If this had been invested in a tracker fund with income reinvested then it would have conservatively generated an equivalent of 20+ years salary.

20 years salary gives 40 years half salary just spending the capital. Interest/dividends take care of the index linking.

Why is it that the government will not revise the valuation of the teacher's pension fund? Four years ago when it was last valued it was sufficient to meet future liabilities. It must be worth hundreds of billions of pounds. These proposed changes are ideological not financial necessity.

I agree anonymous we badly need greater involvement in decision making. For example the people can raise a decent petition but the absence of a written constitution means the petition does not have to be actioned.

It was hoped the referendum on electoral reform would lead to greater devolution of power. Unfortunately the government manipulated the question the same way as they did in the mid 70's about EEC membership. Therefore even if they agreed to a referendum on pension fairness across the board they would manipulate it to avoid and social mobility or increase in suffrage.

I almost became a teacher and had alot of contact with the profession. The problem with teaching and teachers is a very complex one.

The majority of them work much harder in term time than most in the private sector. But a few do the absolute minimum and can get away with it.... Some schools are pleasure to work in others a complete nightmare. You can only move jobs generally once a year. There a big differences between the level of work you absolutely have to do depending on whether you are in primary or seconday and /or different subjects. Some people are natural teachers and absolutely love it and some just aren't and dont..

However for me the biggest issue is career progression. In the private sector professions you can go up the scale with bigger increments in pay. In teaching many dont want to move into management so they feel sort of stuck if they are still teaching in a classroom after 30 years with no massive increase in pay. Also 20 years ago teaching was incredibly lowly paid for someone who had to have a degree followed by 2 years of training. whereas now it is much better to start...

Divide and Rule lives on - no matter which Party is in power - and we fall for it every time!

Well.!! Dear me we can tell it’s a Friday can’t we. We have all had a bad week and are getting a bit tetchy. Descending into calling each other names, almost. It will come to “My Dads bigger than your Dad and I’m gona tell my Dad and he’ll beat you Dad up – so there!!!”

Seriously folks.

At the end of the day, whether Public or Private sector, if you have worked hard all your life you deserve a decent pension. If you have started a job and devoted a good part of your life already (even if you are only 40 or so) and are now told sorry but you have to work longer, pay more for your pension and it might be smaller than we promised you, well yes that is hard to swallow.

BUT

You Guys and Girls out in the Public sector need to understand that those of us working in the private sector (without whom you would not have a job at all as we are the ones – including those working in finance – that produce the country’s income) have had to swallow this for the last 15 to 20 years. It was in the 90’s when private sector DB / Final Salary pension really started to fall off the map. There was no great Hugh and Cry from the Public sector then so you can hardly expect to have unqualified support from the public now.

Lorna – as I criticised your article on this subject last time let me say that this is a much more balanced and thought through piece. The percentage of projected gross domestic product (GDP) that public service pension represent is not and should not be the issue. We should be looking to provide a decent and fair pension as part of the overall package to people who provide us with Society’s safety net in many instances and future in others. You entrust your safety to some and children to others. Do you really want the best you can afford or worst to provide these services?

The point is in the end pensions need to be not so much affordable but sustainable and that needs public sympathy not a sense of unfairness that current prevails in the general public.

I think the words may be tolerance and compromise.

Hope you all enjoy your weekend.

Bob Walker you are so right! Why don't teachers take industrial action in August! They have plenty of time on their hands then, haven't they... I have worked in the private sector all my working life (until I was 68) and we were all totally shocked when Gordon Brown raided our pension funds on the sly as soon as labour got in in 1997. But I didn't hear anyone complaining then... Also, the public sector employees must remember that it was the labour government who set the ball rolling for the change in their pension contributions etc. back in 07/08. I wish the media would tell us the whole truth instead of what they deem makes a good headline. And they never ask the relevant questions to these very, very highly paid union leaders who should be ashamed of themselves concerning the gravy train they are all riding on at the moment. I'm all right, Jack comes to mind....

The way people are so jealous of anyone else getting a decent pension makes me sick.

I worked in the private sector for 40 years and my pension was raided by Mr Brown also, but I don't go round shouting from the roof tops for everyone to lose their pensions.

Do any of you guys slating these people send your kids to public sector schools, or ever needed the NHS, or emergency services?

Course you all have at some point.

Did you come away thinking "hope they all lose their pensions" No of course you didn't.

You have ALL been brain washed!

Also, some of these people pay upto 6% of their salary into these pensions. Now as some of the schemes started say, 1950 ish and are 40 years schemes (teachers) what happened to all those contributions whilst waiting for the first to retire in say 1990 after 40 years was upi

You all know what happened. The government used the funds for other schemes.

Now of course, they moan like crazy their unaffordable!

Course they are, they used all the money they should have beee saving

I do have a public service pension after 31 years as a GP. I paid an extra 7.1% of my income annually plus the standard rate of 8% to be able to retire at 60 with 40 years service. Pensions contributions now are 16% of income and retirement is 65 for the current GPs. (The new GP contract made the personal contribution and the employer's contribution both payable by the GP).

Buying the Added Years was the best financial choice I ever made, back when I was 30 but it wasn't a freebie, and in the early years I sometimes wondered if I had done the sensible thing. Glad I did though. The current GP pension scheme is self-financing as contributions outweigh payments out - there is no fund invested in something as dodgy as the stock market or for the Chancellor to dip into like Gordon Brown did.

GP pay moves in very strange ways - there have always been years of pay freezes (I think it now 4 years since the last rise) with huge leaps as the Government has to catch up with the Review Body recommendations. So my income would jog along quite comfortably and then there would be a huge hike every 5 years or so. Planning not easy if you work for the Government as they don't know what they are doing most of the time, or so it seems.

Putting it simply,what planet are these people on? The woman who yesterday went on the radio and said it was unfair as she had planned to retire at 60 due to fact that she felt she could work no longer summed the whole issue up. Hard luck. At this rate I will be working till I drop without any supplementary pension from my employer.

Completely out of touch with reality is the issue here. Well, I think it is unfair that I am expected to contribute to the Public Setor supplementary pensions when I receive not a penny from the state in return. And by the way, the Teachers Union owe me one day's loss of earnings! Good article.

Everybody keeps talking about the comparison between the private pension sector and the public sector pensions. The difference is like chalk to cheese.

In the case of private sector pensions, this is fact, real, so to say, bricks and mortar which can be seen, because the money is in fact corralled, set to one side.

Public sector pension is a wholly different beast, and I use the word advisedly. It is a potential horror story. Money is taken from the individual employee and a "notional" amount from the employer, the state, in whatever guise, but not set aside in a separate fund.

The contribution from the employee immediately gets spent somewhere else and there is no deduction from the state, it is like a lease back, the bill for which gets higher and higher as time goes by.

We all know that public sector pensions, for those now drawing, is paid from current account, taxes raised in the last year or so. So, as time goes by and the bill gets higher and higher, more and more taxes have to be raised to meet this liabillity (except in the case of local authorities, but instead of relying on the value of the assets purchased with the set asides, they do calculations and if there is a theoretical shortfall the ratepayer is charged extra until the 'losses' are made up, the open promissary note, and con). This is a conspiracy between the unions and the State/LA because they both know that there is no immediate charge to the state for making provision for the pension of the contributor, in reality a discount to the State, which the State now wants to increase to meet promises made years ago and to pay to others, not for the benefit of the contributor.

This Ponzi scheme must be stopped. Make no mistake about it, it is a Ponzi scheme, except here the suckers are the taxpayer and the "Madoff"s being a mix of the politicians and the unions. Prosecutions should also follow for this con

The hiring of new employees previously at an economical rate, with the discount of their "insurance" contributions was a small increase in current taxation, with the promissory note written with no figure added in for future pension liability.

Unions ignore this fact, as do their members, because it is convenient for them to do so, but they want to strike to maintain their future Utopia.

It would be far better for the contributions paid by the individuals and the employer's contribution to be set to one side and invested. At the end of the day the fund be divided according to the contributions made and the yield earned by the sums so set aside. Unfortunately it is a bill that we cannot currently afford to make good and the longer we delay the bigger the bill.

What is happening now is merely tinkering at the edges of the real problem. What needs to happen is as stated in the previous paragraph, the money is set aside and the pension is calculated according to the result of the investment, with accretions/losses, just like it is in the private sector?Equitable Life.

Gordon Brown/balls have written huge promissory notes for us, not only with PFI, but the vastly inflated liabilities for the pensions of those hired in the last 14 years. The politicians and the unions must take responsibility and make good the promissory notes written from their own reserves.

As I said above, comparing private sector pensions to public sector pensions is like comparing chalk to cheese, one is fact and quantifiable in asset terms from time to time, the other is pie in the sky, an ever changing figure on a piece of paper with no assets behind it, except those of the txpayers, and intangible.

Ok ...Ive heard enough from you lot..now be quiet and sit up straight

What is this so called private sector ..what have you got to crow about anyway ... is it rocket sience to drive a parcel delivery van or serve up a kebab or work in a super market...answer no.

As for teachers at least they teach children unlike

private sector staff who serve up fast food poision for a living.

Lets face it ..private sector =low qualifications=low pay=low pensions

You didnt listen to your teachers...didnt get the qualifications and now your bitter.Some people just never learn.

By the way just in case you dont know the goverment is in the PUBLIC SECTOR

ps..your out gunned you probably dont get it ...but the goverment

I don't follow this private sector =low qualifications=low pay=low pensions

Pay has fallen in the private sector due to the collapse in the banking system which has had knock on effects in the private sector (which includes anybody not in the public sector - both intelligent, educated and unskilled). It's only now that the financial constraints that have resulted are being passed onto the public sector who until recently have escaped the financial woes lightly.

This is about global redistribution of wealth. The less that British citizens receive the more there is for redistribution and the global plutocratic elite. Forget public service or private employees, all they want is your money and they have succeeded in conning most of us.

Tough enough, and what have you to crow about? There are many teachers responsible for churning out children deficient, passing them with fraudulent certificates as to their abilities, in the 3 Rs and the huge number complaints from employers that the product produced are not fit for purpose in terms of writing, arithmetic, reading and the universities complaining that for the first year (and more) they have to teach the students that which they should have mastered/been taught at school.

At least those working in the jobs you say are pulling their weight, not on the dole or polishing pc observance of minorities/religion.health and safety (in reality even getting out of bed in the morning, traveling to work by whatever means-fumes-overtaxing-not qualified to ride a bicycle, waling on wet/icy surfaces, risk from others pedestrians, cars cyclist etc,etc is a health hazard).

Get real, life ain't fair, it never was and never will be.

Ok Snoekie

I guess I was wrong .........I clear forgot about all that dangerous ice and stuff'

By the way do you think that the Lloyds 9 1/4 Preffs are a good buy at 88p ?

I do.

You did say get real

Toughy, Lloyds, dunno,

The point remains too many PS jobs are for ordering others around. PC and ensuring that the minorities views/feelings take precedence of centuries local custom, tenet and behaviour and as such strangling business /industry with fiat and 1000s of miles of red tape, giving distinct advantages to less scrupulous competitors, whilst the politicians ignore their own diktat. Nothing to do enhancing competition, more to advantage our 'masters' a short hop away.

PS, the PS wants fat pensions for those non jobs, and I object as they serve no real function other than to pay the unions who in turn support those who were largely instrumental for the mess we are now in.

I am still waiting - 10 years on for my Equitable Low Life Pension Compensation- down 60% due to bad and inadequate government regulation that costs a packet at the FSA! We cannot afford the £4billion needed says CamerClegg because of Austerity UK so clearly we taxpayers cannot afford the £35 billion PER YEAR needed to fund uncivil striking greedy civil servants pensions. We could probably sack 50% of them and not notice it.

Of course Gordon "Private Sector Pensioners Enemy" BROWN started the rot in final salary Private schemes when he stole dividend tax relief so he could fund the excessive welfare payments to single mothers and the like in his Bastardisation of Britain program that rewards fecklessness and promiscuity vs decent married life.

Single mother - what a misnomer - it takes two to tango - single only because they get more benefits to fund a feckless and idle lifestyle breeding feral kids that any teacher will tell you are a nightmare to teach. He also ballooned the number of civil servants with ludicrous labour intensive tax systems and the like. He should be in prison for the harm he has done the UK. As realism sets in and the birds come home to roost we should prepare for decades of austerity unless the books are balanced.

MP's of course need their pensions reducing not to mention expenses. Far far too generous. We - the taxpayers- cannot afford such generosity. It is monstrously unfair.

No wonder foreigners take the jobs because our education system does not deliver educated workers with basic reading, writing and arithmetic skills and the welfare system does not deliver the work ethic.

All due to misguided socialism.

tough enough well said,

mps sort your golden pensions out first then look after the borders second.

divide the country to take away the heat off the mps pensions and the rich tax perk pension pots , so again attack the low paid and leave the tory lab lib mps pension pots alone . call them selves leaders so reduce there pensions first.

its head teachers ,mps . and all the top people who want sorting. next sort out the law system that eats money like pensions,legal aid and appeals for lots of things

I have been teaching for 30 years. Straight after graduating from university, I worked in the private sector for 15 months, in academic publishing, editing theological and philosophical books that were targeted at a mainly undergraduate/graduate readership. For the last 20 years my main priority has been teaching A Level Philosophy.

I think Lorna Bourke’s recent and emotive outpourings on Citywire merit some serious analytical dissection. I think this will reveal that they are cliché-ridden, ideologically motivated, factually vacuous and employ equivocation whenever the evidence fails to support her prejudices.

On 23 June 2011, Lorna’s attention-grabbing headline was: “Public sector pensions: the unions just don’t get it”. A consistent slur from Lorna is that we, in the public section, lack the intellectual acumen to appreciate how good our pensions are. Her last section heading in her article that day is titled, “We just can’t afford it”. She contends (making absolutely no reference to the weighty, detailed and meticulously researched findings of the National Audit Office or the Institute of Fiscal Studies) that public sector pensions are simply unaffordable. Earlier in the article she employs rhetoric and emotive language when she asks whether increasing pension contributions by up to 5% for higher-earning public sector workers is “really an unacceptable hardship?” Astonishingly, she doesn’t bother to answer the question: increasing superannuation costs for me by 3% rather than 5% would entail my paying out almost £115 a month more. Many teachers would struggle to find an additional £100 a month to pay out for the rest of their professional lives. Yet Bourke’s argument fails to address the question she herself has raised and just states that the private sector is hurting. Undoubtedly that is true—but it’s scarcely an adequate response to the question she herself has posed.

On June 30, Lorna’s article was entitled: “Public servants: do they know why they are striking?” The glib and facile impression is conveyed that these feckless and irresponsible public sector workers are preparing to strike over pension issues that they’ve failed utterly to comprehend, but, as John Wright, head of public sector pensions at pension consultants Hymans Robertson has pointed out: “The biggest risk to public sector pensions is that they become unaffordable, which could happen if life expectancy continues to increase.” (Again no mention is made at this point of the findings of the NAO or IFS.) She repeats the tired mantra that life expectancy continues to increase, without acknowledging that this formed one of the premises of both the NAO and IFS assessments.

Finally, on the actual strike day, on Radio 4’s “The Today Programme”, we hear Evan Davis poleaxe a smug Francis Maude by refuting his carefully rehearsed half-truths. Davis has actually read the NAO report, much to Maude’s palpable dismay, and can establish that the cost of public sector pensions, as a proportion of GDP, is predicted to fall, not rise. BBC news presenters get positively excited later in the day as they start to appreciate how disingenuous Cameron and his ilk have been over their misrepresentations of public sector pension affordability.

How does Lorna react? She told us repeatedly on 23 June that public sector pensions are not affordable. At 8.00 am on 30 June she repeats the same mantra, that these pensions are unaffordable and the strikers fail to comprehend the financial facts.

By 18.30 on the 30th June, (perhaps inspired by Evan Davis to read the actual NAO report) Lorna has now decided, on discovering that the statistics do not support her earlier assertions, that these statistics aren’t credible. “Actuaries notoriously get things wrong and a lot can happen in 50 years.” she chirrups happily. Philosophically, this volte-face looks distinctly dodgy. Lorna wants “to have one’s cake and eat it”. So, she shifts the argument, as government spokesmen have done, to fairness. “The reforms are also about fairness,” Lorna pleads plaintively. They are indeed. Teachers are justifiably furious that the contractual arrangements that they have honoured are being comprehensively violated by an ideologically-driven cabinet of multi-millionnaires. I really love teaching and I’m rather good at it (as all my classes could tell you). I accepted 30 years ago that, by electing to pursue a career in teaching, I would never get the level of salary fellow graduates would receive who pursued careers in the private sector. I fully accept that there are more important things in life than the pursuit of wealth. I was told, however, that I would get a very decent pension, as compensation. For example, the starting salaries of my two older children (planning to work in the city as commercial lawyers) will swiftly overtake what I am currently earning after 30 years in the teaching profession.

Is there a solution? I’d like to know what Lorna thinks about union support for the “Robin Hood tax”. Having berated the unions this week for financial ignorance, I’m sure Lorna must have a view on this very plausible solution, but am surprised that it has yet to surface in any of her discussions. Here’s the website (http://robinhoodtax.org/): hope you enjoy Bill Nighy’s excellent performance.

Here we go, Rich Banker, descending into Daily Mail rhetoric over something about which he knows very little.

Chris Hopton

I fully support everything you say including the remarks about Lorna Burke. Citywire if you are reading this I throw down the gauntlet to you. Let me write an article in response to all of the drivel you have published. Have you got the guts to let me do it? Chris Hopton will you join me? You will see from posts on Lorna's articles that I am only interested in what the evidence says and not some half truths.

Chris Hopton, XXXXX, and the rest of the cossetted left wing intelligencia just do understand the seriousness of the situation. George Hill's comment to me is extraordinary in its ignorance. The fact is whether you like it or not, Britain is nearly bankrupt thanks to the spin and incompetance of Brown and Co., and unfortunately about half the population believing them.

The coalition was elected to get a grip on disastrous national finances, but has been suffering a torrent of lies and abuse from the people who got us in this mess to start with. Ed Balls was Browns mentor and advisor so it is extraordinary that anyone believes his woeful grasp of economics.

Why should we all have to pay teachers pensions out of increased taxes? Whether the percentage rises or falls it is still a huge £30 Billion or so which to me is unacceptable, they should start to pay for it themselves, and an extra 3-5% does not seem unreasonable.

The fact is that deficit economics do not work, as someone has to pay the bill in the end. If Britain does not pay its way in the world because of poor education, poor industry and a bloated public sector then all our real standard of living will continue to suffer until balance is achieved.

Gordon Brown did NOT start the world recession. Despite what the Daily Mail says. Many of UK's problems started in the 80s. Short of "affordable" housing today? Look at the council house sell-off. Being ripped-off by the super utilities? Those utilities SHOULD belong to the nation - call that about 20p off direct taxes - if we still owned them. I could go on (and probably will)

I am retired from the private sector, comfortable and I time to look at both sides of the argument. I am NOT a great supporter of teachers or of the (many) feckless inhabitants of Town Halls. I am strongly against welfare cheats, "single" mothers and all the other things railed against by the right-wing press. However, I am even-handed, open-minded and DON'T spout second hand "news". Try it sometime...

Have a nice day.

I agree with John16. Teachers et all should stop thinking that they have never had it so bad and started considering that in the brave new world they have assisted ushering in, that they are going to have to re-arrange their expectations. Forget all this talk about if they hadn't privatised the Utilities or if only Gordon Brown was here, well it is old news and dissapearing into history. You only have to look at China to see that their brand of Socialism has changed radically over the last 80 years. Basically, all the Unions who pupport to be trendy modern socialists ideals are actually die hard imperialists who can't get used to the new world order where Britain doesn't rule the waves anymore. These modern Union leaders are a bunch of selfish narrow minded dinosaurs who live the life of Champagne Socialists funded out of their members hard earned subscriptions. As I said before, what about my rights as a self employed worker? What rights I hear someone shout? Exactly!

If we are all in this together and given the perilous state of our finances, why aren't there (at the same time as public sector pension reforms are being considered) also firm proposals on the table to close tax loopholes for those who are allowed to pay no tax?

I would like to add that I would dearly like to go on strike myself and refuse to pay one penny more in Taxes but I am not afforded that luxury!

George Hill,

Sorry for my comment to you, I agree with all in your last post except the relevance of yesterdays news to present circumstances. Of course Brown did not cause the world recession, but he did make ours a lot worse.

Also agree with the sentiments that bankers and industrialists corruptly awarded salaries are wrong and causing huge divisions in our society. This has inflamed the atmosphere of the present dispute, apart from stealing from the shareholders.

However "Rich Banker" above is not so rich if he has to pay for his own pension which is devalued by Equitable Life. No government handout from the taxpayer here.

Politicians timid approach to banking reform so far may just be caution to prevent killing off the remaining goose that is still laying the golden eggs even in a recession, lets hope it is just a first step.

Whether by intent or stupidity most people are being misinformed about this extremely important issue and the media has a great deal to answer for.

The starting point is “if life expectancy continues to increase”. Normally the ‘If’ is left out, people have little idea how complex this assumption is, look up ‘life expectancy, mortality rates etc’ and you will start to see the scale of the problem.

For instance: Life expectancy is often confused with life span when people hear 'life expectancy was 35 years' they often interpret this as meaning that people had short life spans. This ignores the fact that the life expectancy generally quoted is the at birth number which is an average that includes all the babies that die before their first year of life as well as people that die from disease and war. Because of this sensitivity to infant mortality, simple life expectancy at age zero can be subject to gross misinterpretation, leading one to believe that a population with a low overall life expectancy will necessarily have a small proportion of older people. For example, in a hypothetical population in which half the population dies before the age of five, but most die at about 70, the life expectancy at age zero will be about 37 years but if you measure life expectancy from age 5 thus excluding the effect of infant mortality, life expectancy at age 5 is about 65 years.

The significance of this is that the ‘everybody is living longer’ claim is based on the average mortality age of people who have died over the last 5, 10, 20 and thirty years. The current life expectancy for U.K. males (U.N.) is 77.2 and 81.6 for women. These figures have risen steadily for many years but the increase has been rapidly declining. Is it realistic to expect this level of improvement in life expectancy to continue? They do not relate to you or the current population directly.

You have to think about the changes that have occurred in public health and quality of life since the 1920’s, no Penicillin, modern drugs or vaccinations, but plenty of Measles, Mumps, Chicken pox, Polio, T.B. and poorly treated V.D. (Churchill’s father for instance) just for starters. General nutrition levels are far better as is quality of life and there has been a dramatic shift away from ‘hard labor’ such as coal mining (most miners never lived long enough to even get a pension) and manufacturing in general. Obesity and pollution are taking a heavy toll on the current population, the latest figures in the U.S.A. suggest a FALL in life expectancy for those under 60, you are not hearing to much about that.

Is 12 years of retirement really that selfish? Have we really become that mean.

Next you have the “unfair” tax burden. Who scraped the N.I. contributions increasing in line with pay by ‘capping’ etc.? Well the Tories of course.

No one ever mentions the large number of people who die without ever reaching retirement age, they have normally ‘paid in’ in some form.

We are hitting the ‘baby boom’ retirement patch, this is followed by a ‘baby slump’ where are the figures for that.

Both in the private and public sector there is a casual acceptance that both groups should just accept a breach of contract by employers from the media and, even worse, they are actively helping to turn them on each other, just as they have done over helping the poor which has become a ‘war’ against cheats, so any defense of existing contracts is ‘un fair’ to the ‘tax payers’, pathetic.

Personally I feel a general retirement age of 65 is fair and I would restore the link between N.I. and pay.

Enough for now.

DWSS

A few other points to help deal with missinformation.

Mean Pensions Median Pensions

Police £15,636 £15,583

Teachers £10,858 £10,275

Armed Forces £8,834 £7,987

Civil Service £7,632 £5,023

N.H.Service £7,510 £4,087

Local Gov £4,777 £3,048

All P S Schemes £7,841 £5,603

Mean Pensions inc. Dependants

Police ?

Teachers £9,806

Armed Forces £7,722

Civil Service £6,199

National Health £7,234

Local Government £4,052

All Public Sector £6,497

This is a part of the Hutton report the government and media makes no noise about:

DWSS

Re un fair to Tax payers:

Another part of Hutton that the media will not tell you about:

The pre-July 2007 Scheme

Those who joined the civil service in or before July 2007 remain members of the previous version of the Principal Civil Service Pension Scheme - "the PCSPS" - which had a number of interesting features:-

The scheme is unfunded, in the sense that there is no pension fund which is built up to pay future pensions. But it is funded in other ways:

First, the budgets of individual departments include employers' contributions to the PCSPS, and these contributions are now not only large in themselves, but have recently risen very quickly, up to an average of 19.4% in 2007. (Employer contributions are tiered, depending on salary paid. The details are in a document known as EPN 148.)

Second, all civil service salaries are fixed by reference to those gross salaries that would be paid for similar work in the private sector, and then reduced to allow for notional pension contributions.

This leads to the strange effect that, as pensions are calculated on civil servants' net salaries (after they are reduced by these notional contributions) the reduction is carried through to the pension eventually paid. Civil servants and their dependants therefore continue to contribute getting on towards 20% a year towards their pensions after retirement!

Finally, many civil servants also have real pension contributions of up to 3.5% deducted from their salaries.

DWSS

Thank you David WSS for the clarification.

The pre`07 PCSPS liabilities are clearly a consequence of successive governments failing to instigate a properly managed investment based pension fund.

Is this situation to be rectified?

Or is the easy option for the Gov to just reduce the pension benefits and simultaneously promote discontent between private and public sector pensions by uttering half-truths for the media to propagate.

All of this highlights why we can go bankrupt as a nation.

Political correctness can only go so far, whilst all the anti evolutionary measures will eventually bring the entire system down.

The options for government is as follows:

1. Transfer all public sector workers onto career average earnings on a forward looking basis

2. Ask them to pay more and work longer

3. If they reject points 1 and 2, take them out of the scheme and contribute to their private arrangement which they can manage themselves

Very soon people will realise to keep quiet and get on with doing their jobs as opposed to replying on others so much. A Nanny state will simply create more problems.

Move on to an either or basis and see what happens...

Hello

2 points,

first. GP's , dont have final salary schemes, never have. we get a pension based upon your career's contribution. The pensions must seem large to many in the public but its only because we earn a high salary and thus the contributions are large.( I am grateful, I love my job, pressure+ but what a vocation). The notion "GP's have large pensions" and "its not fare", is more to do with whether we are worth our high salary. We contribute the same %, and some like me are already at 8.5% rising to 15% ( before the 14% employer part).

second, number number numbers. what is the truth.Here it is.. Imagine a world with zero inflation. No need for pay rises, or infaltion, or annuities. the perfect scenario..You earn 10k, it never changes ( no infaltion). You work aged 20 to 65, some 45 yrs. You retire at 65 and live to 90, so 25yrs retirement and you'd like a 50% pension so 5k. In the example with zero inflation your pot of money needs 125k ( 25 times 5000). At age 90 at time of death, you will have used it all up. So to save 125k over 45yrs work is near 3k a year, some 30% of your salary. Are you reading this...30%. So unless employee and employer contribute near 30% of your salary then how can you expect a pension of 50% after 45yrs. Final salary schemes make it a joke as you have not made enough contribution to warrant a pension boost in the last few years.

That why as we live longer we simply cant afford the pensions we used to get.

Why not give every one their own pension fund. enforce employee and employer contributions and when you retired the fund is yours ( your estates) to negotiate a pension. No arguments, you simply get what you contribute. That would get most back to reality and a sense of fareness rather than blame blame strike strike, lets rob the well off..

Here we go again!

Fact, the public sector pensions are funded by the ordinary tax payer!

Fact, 25% of all council tax goes towards local government pensions!

Fact, They are all classed as Parasites in my book!

Fact, Definition of a parasite = An organism that grows, feeds, and is sheltered on or in a different organism while contributing nothing to the survival of its host.

Now that makes feel sooooooooo much better!

Introduce limits - max public service salary 100K, max public service salary 50K. More than enough to live on - and should ensure that tax payers get a good deal for taxes. And include politicians of course - makes my blood boil that Gordon Brown will walk away with a huge pension!

Fred "The Shred" Goodwin must be laughing his socks off over this backlash that's blown up over public sector pensions. Isn't it strange how he managed to get himself locked into a vastly expensive (for the taxpayer) contract to provide him with a guaranteed fortune comprising a lump sum and pension, as a reward for taking the bank into bankruptcy he was supposed to be looking after. At the time, the government said there was nothing they could do about it and he was entitled to the money. Pity the same rules don't apply to government commitments made to hard working civil servants. All out and stay out for as long as it takes is the only way this rag-tag mob of a so-called government will be beaten.

According to at least one source, indirectly or directly the taxpayer funds ALL pensions, private and public. On 'Finance for the future' website (I can't post the link here)

"Using data for the most recent year available – 2007/08 – it shows that total pensions paid in that year amounted to £117.6 billion. Of this sum £57.6 billion was state old aged pensions, £25 billion was state employment related pensions paid to former civil servants and other former public employees and £35 billion was private sector pension payments.

In the same year the total cost of subsidies to the private UK pension industry through tax and national insurance reliefs on contributions made and from the tax exemption of income of pension funds amounted to £37.6 billion. The result was that, albeit indirectly, the entire cost of private sector pensions paid in 2007/08 was covered by tax reliefs given to the private sector pension funds that paid them. To put it another way, every single penny of the cost of UK pension payments in 2007/08 was in effect paid by the UK government [Ed: i.e. the taxpayer]"

If you wish to question this, go to the source, not me.

Excellent analysis from Chris Hopton above.

The propaganda is based on a number of assertions including that public sector pensions are not affordable.

It is now clear that public sector pensions are in fact affordable but the government does not want to pay them. Presumably it has other demands on that money such as bailing out the banks, fighting wars and building up some reserves to buy votes in 4 years time.

Secondly it is repeatedly asserted that accrued rights will not change. Well they have already changed with the change to CPI and, surely the right to retire at 60 on a final salary pension was also a right that public sector workers signed up to which the government is seeking to now change.

Thirdly we are told public sector pensions are "unfair" because they are better than private sector pensions. So the government is seeking to govern by class envy. Every bit as cynical as the Socialists. Many people in the private sector were offered a lump sum to leave the company pension scheme which many accepted and squandered on a holiday or 4x4. Others decided to not bother with a pension at all and enjoy the money now. Those that did save for a pension were throughly ripped off by the (private sector) pension providers, negligent supervision and accounts auditing and taxation and furthermore forced into overweight Gilts holdings by a government wanting a captive buyer for its debt. Assets held in a pension as shares were pillaged by the company directors who transferred shareholder profits to themselves as wages, bonuses and perks again aided and abetted by the private sector.

Also private companies took pension holidays when the going was good and cancelled the FSPS when the going was bad.

This all happened under the noses of those private sector employees who now find they have been robbed but instead of turning their ire on the people who robbed them (and continue to) they have been diverted into scapegoating the public sector workers.

Demographic changes too need examining. 20 years ago the insurance companies hiked up premiums because we were all going to die young from AIDS and obesity. It never happened. The major improvement in life expectancy is due to reduction in smoking by mainly working class men Because most of this cohort has died off now, it would be niave to think that the level of gain of life expectancy can be repeated and in fact, some US states where recession has been severe are now seeing life expectancy shorten so this what I expect in UK as cutbacks in government and private spending get deeper.

So yes, I agree that on the whole the public sector now has better pension provision. What the rabid public sector bashers need to ask themselves is were they as vocal when private sector pensions were being pillaged?

All the public brigade live in a shelterd world. Time they joined in reality of being in the shit like the rest of us.

Fling the lazy barstards out and let them work in the real world.

DR RAY - spot on

This the classic trick of divide and rule. The real enemy is not at all the public sector and their miserable pensions and wages, nor the private sector thoroughly fleeced by penions fund providers. No, it is the City controllers. And their management of the crisis ses to it that we pay their debt.

No, the real enemy is a country that does not pay its way in the world.

The whole country? There is corporate debt, government debt, and private debt. If you look at the amounts before the crisis and now, you will see that the bank debt was passed off onto the governemnt (the government bought these near worthless assets at accounting values) who is now passing it off the citizens.

We can all see this. What has the trilions owed by Ireland's government got to with Mrs Murphy? Zilch.

Can you see why so many people are so furious - I have lived debt free apart from the mortgage and no way I am paying off these debts. "My country's" debts, "my" debts? You are joking.

So in sum, the government contracted a pension deal with its employees and it will stick to it, or go bust.

Chris Kenney? Putting most public services in the hands of the private sector would be the worst possible nightmare. I spent nearly fifty rather successful years in the private sector and wouldn't trust most of my "ex-colleagues" an inch in behaving ethically. Think Enron, Banks, super utilities, Southern Cross, Oil firms... the list is practically endless. Like it or not, we need public services - and NOT necessarily run for the sake of a fast buck. Like most of the above, they'd end up in foreign hands (not that I'm xenophobic, but we need to be in some control of a few essential national assets)

Simplistic I know but I have a suggestion; just as the Government appears to have agreed a maximum of £50k for nursing home care fees, maybe they can also agree a maximum annual pension sum? This would help to equalise pension receipts ensuring that everyone receives a minimum amount and those who have chosen to contribute a higher percentage of their income could fairly claim to receive a higher amount...

George Hill & Co

It realy dont matter anymore if its private or public. The UK cant afford to pay in future.

The future for us in Europe is alas a whole new ball game ( one I suspect we will not like). I thought the British public would have realised this by now, but they still seem to want to carry on as if nothing has changed.

Have you ever tried to take a toy of a spoilt child? Of course the public sector don't get it they've never had to.

Mark Goodwin

You have to ask yourself why GPs pensions are career averaged. Having seen the income profiles of GPs over their careers, they would be greatly disadvantaged by a final "salary" pension scheme. This is because their income rises rapidly up to the age of around 40, they then suffer burn out or become less ambitious and their income tails off quite dramatically towards retirement. It is for this reason that career averaging was introduced for GPs. This arrangement is just as expensive as a final salary scheme.

Lots of emotion and “half facts here.

Mike B – Brown may have raided your pension fund, but YOU will get it back as the taxpayer makes up any shortfall. So no wonder you did not bleat about the effects it would have on DC pensions.

We are not suggesting that accrued pension rights should be reduced, but that future pensions should be paid for in a reasonable and affordable manner.

We are not suggesting that schools or emergency services are not required.

I have suggested that your maths was imperfect before, and tried to explain that 6% is sufficient only to buy you a £2k (max) pension in your case. The rest is paid by the taxpayer. I do not think that you have understood, Please use a annuity calculator on the web for index linked pensions to find confirmation of the huge pots required to fund these pensions.

A previous comment suggests that the contributions would have funded the pensions over 40 years, I believe that the contributor has generally taken any ruse in the FTSE over the same period and applied this to the entire pot. Of course the contributions are made over the 40 years, thus halving any general calculation. And although the FTSE did rise well initially during this period, losses may well have been made in later years whilst the fund was at its peak. This effect had been well felt by pension funds.

Whilst the Government may have pocketed the contributions, they are coughing up at the end of the day. But they are not compensating private pensioners for their shortfalls, even though for years that rates used for projections were determined by the Pensions Regulator.

The pensions are affordable if we are prepared for our children and their children to be taxed to the hilt to the extent that they will not be able to afford to save or have pensions. You speak as though Government cash and borrowing is nothing to do with you and me. The simple point is that someone has to pay for public employee pensions.

The bottom line is that we are all living considerably longer, and therefore have to work longer (our health around 60/65 is on average far better than a generation ago) in order to fund a longer retirement – say on a pro-rate basis. Just about everyone else in the UK has had to accept this fact. Why is it that those in public SERVICE can ignore this? Do they expect a bigger slice of a shrinking cake just because they are paid by the taxpayer rather than by another employer? Just because some of the roles (not the individuals) are relatively vital does that mean that these roles have become more valuable simply because people live longer?

Chris, how much did you get paid for that sterling piece of misinformation? Tripe, ignoring facts.

John, well said.

WSS, gee, 3.5% of salary, what an astronomical sums.

Funny I was paying 15-25% of my earnings, and then Gordon Brown stole a large chunk of the pot, and to maintain the pot I would have had to raise my contributions to about 50% to make good the shortfall. I couldn't.

The % increase being proposed is just about to 11%, a single digit rise, far, far short of the reality, a sum that would be of a similar proportion to that I had to pay from day 1.

Now, if your pot was reduced by the same proportion that GB did to my pot, you may get some sympathy, but no support. It was done to me, so why shouldn't the teachers and others (including MPs) suffer a similar fate. They threatened in 97 to strike if the like provisions were applied, but were let off the hook, and sure as he*l didn't mutter strike or even sympathy or support for those robbed.

They should be damn grateful that the increases were not backdated, or corresponding reductions in pensions made for lack of proper contributions. That would be justice, and fair.

Chris do take note, before you make noise from that orifice.

Chris. WE MUSTN'T allow the the highwaymen to take what little we have left that belongs to us. Thatcher's dream (borrowed from Pinochet) could yet become a reality. Who CAN pay their way these days? Presumably the USA is also a basket case, owing $14 Trillion today (whater that means in real money)

And before the turbo-charged capitalists amongst you come fighting back, please check your history and the facts. NB the Mail's editorials don't count.

Cazzkins

The Government has introduced a maximum pension by capping a pot value (without being taxed at £1.5ml from April 2012 (Life Time Allowance). Note this has been reduced from £1.8ml in 2011. This equates to around a pension of around £75k at age 65. Yes you could have protected this pension already accrued up to April 2006 but couldn't increase it further from that date.

Mark Goodwin

"This arrangement is just as expensive as a final salary scheme".

Very wrong I'm afraid. Without going into all the complexity as to why you are wrong to give you an idea oh the impact a Career Average scheme at a rate of 1/60th of pay for each year is approximately the same as a Final Salary scheme accruing at 1/80th for each year of membership.

If you don't believe me ask an actuary.

I despair at the level of so many contributions - not to mention the spelling!

Just one point made above - 'contribution holidays'; these tended to arise following the idiocy of the Superannuation Funds Office [a section of what used to be called the 'Inland Revenue'], which determined that a pension fund whose assets [on current market valuations] exceeded 5% of its liabilities. Anyone living in the real world knows that the stock market, and investments in general, go up and down in value. A fund which is 105% funded one year might be 80, 90, or less, % funded a few years down the line and that a surplus of 5% of current market values [don't get me started on the idiocy of using 'current market values' to value a pension fund] is a safe margin for the long term is simply nonsense. But as the SFO were convinced that companies ran pension schemes with the main intent of defrauding the Exchequer, they imposed this limit.

Incidentally, I did hear that no company ever obtained a Modification Order which would have allowed them to get money back form their 'overfunded' pension schemes.

Most of the comments being written here represent the polarizing interests of those who are in the employ of the Government and those who are in the private sector. There is one constant that runs through this stupid debate and that is the nation is struggling to make ends meet and has to do something to balance the books. That we make little and have by default narrowed the means to work our way out of the over generous state system we have erstwhile enjoyed is also not in question.

To reduce someones pension or rather in this case, make people work longer and perhaps harder for their pension is no more fair than it is to expect future students to have imposed on them huge levels of debt by people who have enjoyed free education or it is to further tax those who are not in the public employ.

It is not an option either for Poilitical parties to make mischief. Labour please take note that you employed the best future leader that you never had in the form of Frank Field to look at the whole pension issue with the Pension Reform Group and upon his well thought out and realistic report, you buried him! He rose again and produced an equally well thought out and constructive report on Child Poverty has now been buried by you, the Coalition.

So get off your soap boxes guys and actually come up with some meaninful debate rather than just accuse Gordon Brown, Cameron Clegg or The Daily Mail for the nation's ills. Ensuring that your MP learns of your wishes may be a good first step, whatever your views.

Just plain wrong - we are not all in this together.

Jon, doesn't really matter what you think anyway!

There's no way the government will take on 6 million public sector workers.

A deal will be made probably meaning the current workers will get their pensions as is their right under the contract made.

I really can't see the government taking on Brussells as they have already deemed it unlawful to change public sector pensions.

Then, the new public sector workers will be on a different scheme, which although unfair in my view, will probably appease the private sector bullies!

I know of a service company who the local Council had contracted with and then went the private firm went bust.

The Council brought in the teams on TUPE arrangements to keep them operating the service and they have done so for the last two years. They have stayed on the old PRIVATE significantly lower pay and benefits package (and when I say lower in all I would estimate 1/2 the cost to the Council).

During this period their work mates have been quite happy for this to happen and done NOTHING to support their fellow employees on half their own (so called low) pay. However as soon as their own conditions have been threatened they are now expecting these people, on 1/2 their own pay, to go out on strike to support their position.

This does tend to support the view that it is not just Union Leaders but at least some Union members having this "I’m alright Jack" attitude.

Oh yes I forgot to say - the PRIVATE contract workers will be harmonised under these proposals and guess what - they will get a substantial increase in their benefit package (including basic pay) by accepting the current terms on offer - and their Union co-workers want them to go out on strike!!!

Strange but true I'm sad to say.

Can someone please explain to me why nowadays in the UK one group of people (group A) should expect another group ( group B) too pay for their advantges, even when the doner group (B) are finacialy suffering themselves?

Chris Kenney, it is because group B is not sufficiently alert to this attempted rip and not sufficiently well organised to resist.

In France, many people can see it coming and are getting out. Of the currency. Of the country.

It is the most flagrant rape of the people.

And remember that lowering taxes or cutting services are things favoured by the better off, the poor suffer more, hasn't it always been thus.

There is a general thread running through here by those who do not want to see public pensions reformed, that public employees are the poor downtrodden sector of society and the private sector is rich and can afford whatever the public employees want. This not the case, and it is a fact that many people of low and modest income (below many public employees) have already been paying significant amounts to support the hidden increases in benefits such that they are unable to save enough for even a small pension and will either work for ever or suffer real poverty in their retirement For example think of all of the shopworkers when you next go and spend.

George – no highwayman would want to rob our debt from us. Hope you saw the “Made in Britain” series on BBC1 – good balanced view of our manufacturing and service industries and their contribution to exports. And as you appear to be anti-Capitalist then I can count on your support that one half of the population should not have to pay for a huge perk enjoyed by the other over and above a fair wage.

Mike – I think that very many public workers accept that reforms are necessary. And Brussels (not the sprouts) has forced Greece to CUT CURRENT public salaries and pensions, so I am not quite sure how you figure that bit out. Probably does not matter what I think is usually a demonstration that the other person is unable to make a rational response. But then in the grand plan of the Universe it does not matter what anyone thinks !!

Jon - NO, I'm not anti-capitalist. I made a very decent living in the private sector. I did see "Made in Britain" and proud of what we do well. Let me explain what I AM againsat as some figures came up during the during THAT programme to illustrate my thinking. MacLaren was cited as a success. Terrific - the company and its shareholders deserve every penny they generate (What was it? £250,000,000) Likewise the good news from the North wth car manufacturers placing their faith in ourselves to the tune of several hundred millions. Fantastic news!

Switch to the news item on (just for example - but there are hundreds of similar stories) the Southern Cross obscenity, where a HANDFUL of robbers, blatantly set-up deals to rob defenceless people simply by using a spreadsheet, and making themselves filthy rich (apparently) quite legally.Pocketing these sort of amounts purely for financial trickery. (As a one time accountant, I'm ashamed of them) As I said, there are MANY similar examples. THAT'S the capitalism I am against.

I don't agree with sandbagging lazy public servants or even our sainted representaties (I know a fair bit, personally, about the Westminster village. More than most, having a close relative in the upper house) or City directors handing themseles huge amounts regardless of company performance. Our national assets sold off at bargain prices leaving the peasant to, forever, pay through the nose for essentials.

If we ARE all in it together, someone give me and my fellow citizens a sign...

The problem is very straightforward. Polictics and leadership do not go together. Politicians have been dodging this issue for 20 years, but the decision to reform requires strong leadership. Note very popular with voters.

Teachers are allegedly intelligent people and anyone can see 'final salary' schemes are unsustainable in their current form. Even 'career average' seems generous in today's climate.

The way forward is to reduce the burden on the state so that this money could either be saved, or used to fund other projects. It's not about actuarial forecasts tailoring off in 50 years!

Greece to pay off a debt mountain.

These are their measures.

A levy; 1% for those earning between €10k and €20k a year, 2% €20k and €50k, 3% on €50k to €100k, and 4% above €100k or more.

National insurance increased.

Lower tax-free threshold; income over €8,000 a year, down from €12,000.

VAT a new top rate of 23%.

Wealth taxes on yachts, cars and swimming pools and higher property taxes.

Retirement age 65; increased means testing and cuts to benefits.

Public sector wages; salaries reduced by 15%; cut 150,000 public sector jobs; hiring freeze; abolition of all temporary contracts.

Government department budgets reduced; reduction in defence spending;

Greek deficit 10.5%

UK deficit 10.4%

Public sector strikers - please take note.

@Dhan SHARMA

Dhan I think you have missed the point of the majority of comments here.

No way are those contributing to a defined and agreed pension scheme going to accept changes to the terms and conditions being imposed on them.

The argument you make that the savings here (from ripping of the contributers) could be deployed elsewhere in the economy is a n interesting one. But really, before paying back banks and printing money, this was the thing to do - why put taxpayers money into uselessly paying back banks (and rewarding their deviant behaviour), when the money could have been put to restarting the productive parts of the economy.

So let us stop this scapegoating of lowly paid public servants and get to the real culprits. This is how to save the economy.

A few of points on "Cape Town":

" of lowly paid public servants "- it amazes me anyone still repeats this canard. It was obvious to me that this was not true even in the 90's when, as a union branch secretary, I received income figures produced by 'Labour Research' for various trades, professions and jobs; except for some scientific grades, civil servants tended to earn more than those in the private sector even then. That was ignoring holiday entitlement, working conditions, job security and .... pensions.

Mentioning pensions:

"No way are those contributing to a defined and agreed pension scheme going to accept changes to the terms and conditions being imposed on them." What do you think happened to all those private sector final salary schemes. Believe me, the changes, right down to discontinuance, were imposed on us.

While we're at it, another point brought up several times refers to the 'higher educational qualifications' of state employees. What % of the figures are nurses, now an all-graduate entry, I believe. And teachers, now an all-graduate entry, I believe. In my day, not even all secondary school teachers were graduates. Are they really all better nurses and teachers, or is it just more 'qualification drift'.

Take away all those previously non-graduate nurses and teachers and what are the numbers then?

I have some sympathy for the teachers. Very few of them retire of old age.

Quite a few run out of steam well before retirement age, medical reasons etc, or get shunted into retirement so that schools can save on salaries.

It is recognised that it is one of the most stressful jobs anyone can have.

Poor Antonio should bone up on maths. 39% of those " working" in the public sector may have degrees, but that is 39% of a far, far smaller number than the people working in the private sector. Moreover, one has to distinguish between degrees in, say, law or engineering and degrees in the various kinds of social work prevalent in his sector. In my former business I can't think of a single employee who wasn't sharper and more energetic than any of the public sector acquaintances I know. If I want fully to depress myself, I buy the Gruniad on a Wednesday and look at the jobs available in the public sector, many of them beggar belief . And the worst thing is that I'm paying for them!

Failing Schools by the hundred. Aircraft Carriers without Aircraft. Armies of officials for everything under the Sun. Draconian laws that threaten the Freedom of speech. A public sector that is grotesquelly over bloated in Pay, conditions of employment. Cushy hours of work for those not disciplined by performance and profits. A House of Commons full of hypocrites. , having sucked up to Murdoch for years, drinking his Champagne, now posturing and threatening the Freedom of the Press in Britain ,and running for cover. The whole public sector, for want of a better description , is rotten to the core in Britain. I crave a new breed of Politician, full of Common Sense, untainted by the corruption of the last 20 years of the "Public Sector" who will get Britain back to work earning a living.There are mighty hard times ahead, if we dont.

Thanks Graham! When you add . . . .

- Common Market waste , and

- Huge salaries and bonuses for doing average jobs in now largely publicly owned banks

- Loss of infrastructure and utilities to foreign ownership

. . . . to your list, it becomes even more depressing.

We are paying for all this lot in our taxes directly or indirectly. Or actually not paying, only borrowing a mere £150 billion p.a. despite cuts. Plus running a huge balance of payments deficit even in recession.

Dont worry though, UK debt will soon be the same as GDP, figures so large no-one will understand them, and with sterling free we can devalue and default on our creditors.

What a mess, but we can always read the Guardian job adverts to cheer us up.

I think we can call this debate to a conclusion. To-day's official Government figures to finance the future pensions of "The Public Sector" ( The very title sends shudders down my spine) is £43000 for every household in Britain alone . Add to that all the other wasted Billions of "The Public Sector" and you can clearly ,and unequivocally see that it is financially impossible, unless you want insurrection. Confiscation of peoples' wealth on a mass scale is the only way to bridge the chasm ,as wide as the Grand Canyon. There are sinister people who would advocate such tyranny. One thing for sure if you rob Peter to pay Paul; you can rely on Pauls full support.

Hi Graham! Great idea (Confiscation of peoples' wealth on a mass scale) Why not indeed? They've been doing that for centuries - time for insurrection. Only the poor pay taxes as you are well aware.

George “Only the poor pay taxes as you are well aware” – what a load of…… OK – we can all cite instances of some of the very rich managing to avoid taxes, but unless you define the poor as all of the rest then this is an utterly incorrect statement. Is an average teacher retiring at 60 after 40 years on a pension of £20k poor bearing in mind it would need a wealth of around £700,000 to buy such a pension? Plus any lump sum. If you add this to the value of the house etc. then there are plenty of such POOR people around ! :-)

Fraeme - and so what methods do you think the government will use to separate us from our savings? And do you think the point of such an attemped heist is to pay the pensions of public servants, or pay the debts of bankers?

The Banks used to supply the revenue with at least 25% of its revenue take per annum. There is no profit in Banking in the UK due to the losses in financing the desparately poor UK economy. These losses combined with the 12% rate of interest charged by the Govt on any money lent to them has more or less skimmed the last vestiges of return to the shareholders(Lloyds and RBS) apart from Northern Rock no other Bank borrowed money from the Central Bank of last resort. The City milch cow has suffered a hiccup due to the world Economy, but its shear vitality will ensure its recovery as the World's leading financial centre. The over bloated Public sector has to be scaled down to a size that Britain can afford. Vast areas of it are totally unnecessary,coupled with endemic inefficiencies. Much of this was created by the last Govt. as a way of distributing income. An economy which has practically 1 in 4 employed by public sevices will surely fail, just like the old Soviet Union. The entry to the EU has cost this country dear. Even yesterday a Latvian woman who has moved to the UK was demanding that Britain enhances her £50 Latvian pension to £133 per week having contributed exactly NOTHING. No wonder the World wants to settle here to live.

My comment on only the peasants paying taxes was, of course a bit tongue-in-cheek Jon as you spotted. But I didn't say it - Leona Helmsley was an obscenely rich nightmare of a human being- so she should know. This disgrace to humanity said “We don’t pay taxes. Only the little people pay taxes.”

Of course most of us are "poor" - even those of US who would describe themselves as rather comfortably off. A miillion or two pales besides the rats who profited from the Souther Cross disgrace. The ratchet turns surely one way all the time - with the proceeds ending up in fewer hands. Sure, few people disagree that Public Services are sorely in need of proper management and being made more efficient. After all, we all NEED those services and we certainly don't need more

carpetbaggers, venture capitalists or just financial robbers, to take (i.e. buy at cut prices - we've been here before!) what IS left of what was once OUR industries, pare them to a worse than base minimum - and run cut-price services no good to anyone. Not forgetting snatching substantial "bonuses" for themselves in the process.

When my son asked me if i watch the apprentice, I replied no, because I do not like the way people are allowed to let their greed/competitive nature make them do things that would not be acceptable in our families.

The private sector is all about money - & money being the root of all evil, we can see clearly with the News Int scenario, it can be used to buy politician's time, the silence of the police, & worse still, invade the privacy of people who are going through the most terrible times in their lives. While journalists are keen to investigate others in power, the power they have to corrupt individuals is beyond redemption. No amount of money is going to get Rupert off the hook, but his ego does not recognise it.

While discussing medical profession & ethics with my work colleague, I replied that in all the years I had nursed, I only ever had respect of 10% of the consultants in the various hospitals I had worked in, the 90% were tossers who believed that the were so gifted or powerful that they could be nasty & get away with it. Many of the consultants are just bullies who rely on their other bullying colleagues to keep quite when things go wrong. Admittedly, this was not in the NHS, but the medical profession is full of bullies who have no ability to communicate with lesser mortals - I put this down to the medical colleges churning out young people with the notion that they are super human beings, & as the numbers of worng medication, wrong site surgery, & other medico-legal problems rise in number, the very organisation that causes the problems is expected to clean up its act!

We know politicians are not fit to police their behaviour, we know the media has failed to regulate itself, so too the police - when will we introduce independent bodies to regulate rather than your buddies to tell you when you have done wrong, & paying them big bucks to do so?

Rose. I agree that the private sector is all about money, and whilst i also agree that there are many things wrong with it, where else do you think money comes from?. Competition is what provides the money we can then spend o the public services. There is no other way.

Rose, not sure how relevant your comment is in this forum.

First of all, I totally agree their should be independent regulation, however as we seen in the past this needs to

be done properly with the regulator having the right amount of power. But this costs money, which of course will come

from taxes. So we then tax the firms to pay for this regulator, they have less profits and even tighter margins and this

then means less money for the employees. The private sector average pay rise is nearly nothing and in most companies it is nothing.

This is well below the rate of inflation, which in money terms means people are poorer.

Going back to another comment, money is the root of evil, a very sweeping statement and I am sure you cave every pound you get, like 99%

of this world. It’s the 1% that give everyone else a bad name, and I hope those people get what they deserve.

There are many rich people who donate a lot to charity, without this money the charities would fold….

Going back to the media comment, they keep people in line to a degree, but it is a very thin line to balance. Because of the media there has been some great

wins for the population and the country and everyone seems to forget these… But as mention above it is a few that tarnish it. It comes down to are their

actions for the good of the people or to make money. Hacking phones of victims was all about gossip to increase sales, and I think people should be

held to account for those actions no matter how high up they are…….

But going make to the subject of the article in question, is the public pensions, and looking at all these comments, the underlying issue is pensions need to be sorted

out and made fair across the private and public sector, and the public sector needs to understand there is not enough money in the pot to fund these pensions, this is

a lesion the private sector learnt a long time a go…..