Via Belle Gerens, via Tim W , publicservice.co.uk is running a Fun Online Poll: "Should public sector workers have to pay more to maintain the value of their pensions?"
As of now, "Yes" is ahead with 67% of the votes.
Tuesday, 13 April 2010
Fun Online Polls: Public Sector Pensions
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14 comments:
Perhaps they will run another poll if this one does not give the right answer.
75 now.... :)
81 now...Can you take a wild stab in the dark at how we're all voting?
83%.
But some of the public sector employee comments in there are too depressingly ignorant for words.
wv: tiaxer
Now up to 86%.
It's a good poll though, as it won't let you vote twice - when you go in a second time, it shows the result rather than the voting buttons. (yes I know you can delete cookies and so on).
85%.
They must be getting quite a shock at the vehemence of the comments telling them they are feather-bedded!
I've just filled in the form to join the LGPS.
I did some sums using the HL pensions calculators and there is no difference providing you can get 6% per annum growth after fees (based on the HL assumptions of 2.5 inflation etc.)
In fact saving 20% of your salary before tax (13.5% employers contribution, 6.5% employees) should make you slightly better off that the final salary scheme in my books.
I don't know how they have managed to run up a deficit (well I didn't until I saw which fund managers they were using).
I tried to explain this to a colleague who told me I was wrong of course.
S_L, what does HL stand for? The local government scheme is different to most public sector pension schemes as it is "funded" - the schemes actually invest money in things - and not 'pay as you go'. But that 13.5% is not really 'employer's contribution', it's just extra salary funded by Timmy Taxpayer.
S_L, that depends on what happens to your salary over your lifetime. If you stay working there, and your salary goes up as you get promoted, your payments go in at whatever percentage over your whole life, but the pension is based on your final salary, which will be much larger.
If you want best value from a final salary scheme, be the office cleaner for 40 years and then get promoted to be a highly paid manager for the last couple of years of your working life!
Mark... "HL" - Hargreaves Lansdown maybe?
AC, there have been some tentative moves towards career-average-salary-final-pensions, which tends to favour, or at least does not disadvantage, the lower earners whod stay office cleaners all their working lives. Which sounds good to me. It's all in the manifesto, of course.
MW - yes Hargreaves Lansdown and yes it is a 'taxpayer contribution' and a very high one by any standard. The taxpayer is the employer through, it think it helps the debate to bring the actual numbers into it.
AC - This is a big issue, you can get cliques of middle managers all nearing retirement age together that 're-organise' things a few years before they all retire. I've heard a few stories. They also give over-generous payments for early retirement/redundancy for some reason - when they don't even need to.
The assumptions on the HL calculator are 2.5% inflation and salary and contributions rising in line. So if your salary rises faster than inflation then you are milking it.
Basically, on the current taxpayer contribution you'd have to achieve growth 3.5% above inflation to beat the defined benefit - assuming your pay rises in line with inflation.
You'll never get a proper debate on this issue with the baby-boomer beneficiaries and their unions though.
Much rests on the method of calculation of average career earnings, of course!
The Police are the best example of a system gone mad under existing defined benefit schemes. They always say they contribute 11% of salary and so their "take it after 30 years, index linked" scheme is justified, because other public sector workers pay 6%.
Convincing them that index-linked benefits payable in some cases from 47 years old (and so actuarially for a male, payable for about 35 years)takes a humungous amount more than 11% of a constable's pay by the time he's retiring as a superintendent (or whatever) is a fruitless task.
Calculating a weighted mean might balance things up a bit.
And meanwhile, the freeloaders are fighting back....
Yes = 42%
No = 58%
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