"A departure from normal practice"

The Indie is currently running an exclusive reporting that "David Cameron is trying to force the head of Britain’s civil service - Sir Bob Kerslake - out of his job because of his (we assume they mean the PM's) frustration at the slow pace of Whitehall reform".

The report continues "It is believed that the Cabinet Secretary Sir Jeremy Heywood has been asked by Mr Cameron to draw up a shortlist of possible successors. In a significant break with tradition, the successful candidate could come from outside the civil service". Commenting on the appointment in November 2011 of Sir Bob as head of the civil service the same Mr Cameron who now apparently considers him a bit of a ditherer said Sir Bob would bring a "wealth of experience" to the role.

According to the Guardian (15th November 2011) "Kerslake will now combine his new role with his current job as permanent secretary at Eric Pickles' department for communities and local government – a role he has only occupied for a year, taking it up last November (2010). He previously established and then served as the first chief executive of the Homes and Communities Agency (2008 - 2010). From 1997 to 2008 he was the chief executive of Sheffield Council".

Prior to that he was chief executive of the London Borough of Hounslow. In other words, Sir Bob is not your archetypal "career" civil servant - unlike Sir Jeremy - and the wealth of experience he brought with him mostly related to running a local authority, which is one of the reasons he was felt eminently suitable to be the permanent secretary at the DCLG, which, as the G made clear, he continued to be, in addition to being head of the civil service.

So the (relatively new) "tradition" that someone directly appointed to a post of Permanent Secretary with no previous civil service experience is then one year later made head of the civil service may be about to be broken; with someone with no experience at all being appointed to the role in succession to Sir Bob. Well it ties in nicely with the suggestion that Cabinet Ministers should be able to choose and appoint their permanent secretaries, and also directly appoint their own private office staff, and, obviously, once all that is in place, the wholly apolitical civil service will become a reality.

Yes, that's all perfectly true, but why wasn't The Guardian saying this while Labour were in government?

From The Guardian:

But lobbying doesn't begin to cover the extent of corporate influence. More than ever the Tory party is in thrall to the City*, with over half its income from bankers and hedge fund and private equity financiers. Peers who have made six-figure donations have been rewarded with government jobs.

But the real corruption that has eaten into the heart of British public life is the tightening corporate grip on government and public institutions – not just by lobbyists, but by the politicians, civil servants, bankers and corporate advisers who increasingly swap jobs, favours and insider information, and inevitably come to see their interests as mutual and interchangeable.

The doors are no longer just revolving but spinning, and the people charged with protecting the public interest are bought and sold with barely a fig leaf of regulation.

* Ahem, does the name Tony Blair ring any bells?

'"Park and Skim" still proving a nice little earner for Work Programme Prime Providers' Update

A really splendid "I have of course given back all the money I made from it [not]" The Work Programme is failing the taxpayer piece from  Richard Johnson -  "a special adviser on welfare to work*, former managing director of welfare to work at Serco, and former chief executive of welfare to work provider, Ingeus"** - is now available, in which he agrees with the Select Committee Report.

This stands nicely alongside his The Work Programme's only success is at 'creaming and parking'- in which he explains that it was of course every other prime provider doing this, but not the ones that employed him, and The Work Programme should help the jobless, not contractors in which he rubbishes the DWP's first report on the scheme, and explains that the contracts are set up in a way that makes it really difficult for anyone who isn't or wasn't on the inside to have a clear idea about what is going on.  

* Richard works for the Select Committee in this capacity, alongside being Lead Advisor at ACEVO, the Association of Chief Executives of Voluntary Organisations and Chair at Social Investment Partnerships

** Ingeus obviously agree with Richard. As was pointed out in the G just the other day, Ingeus UK's current chief executive, Dean James, is a former senior DWP civil servant.

“Everyone should take it, it’s better than Ecstasy”

"Yes, there are downsides.   In no way can it be considered pure, in fact it's contents are highly dodgy and it's use is probably illegal.  But it leaves you feeling just great, about yourself and about everything.  Well it certainly left us in the BIT squad feeling like that, especially after the DWP crew had gone away after that meeting where we persuaded them it was just the thing to persuade unemployed job seekers to take.  We all just sat around the meeting room, giggling like schoolgirls, grinning inanely and giving each other hugs.  Now the word about us and our product is out there, everyone will be queuing up at the door for a sample of what we can provide.  Which is fine, but bring cash, ok" 

"Set free the legions?" - Is that some Grand Alliance pledge to end, er, the slavery of public sector employment?

I know the Grand Alliance has been cracking down and doing its best to make public sector employment slightly less attractive since May 2010, but I didn't realise they had gone that far...

Cabinet Office sources said “We are determined to set free the legions of entrepreneurs in the public sector and help them run their work in the ways they know best”.

But it would seem they don't necessarily want to be free.

Vaguely interesting .... or immensely depressing and explaining one hell of a lot ...

The Department for Work and Pensions chose today to unveil its new website and issued a release about it https://www.gov.uk/government/news/we-have-a-new-home-on-the-web

Anyway, a scroll through the new layout at www.gov.uk/dwp  was called for, and whilst doing this on the Home page section for the "great and good"  (no photoshopping was used in the production of the images shown) took a gander at the entry for Chris Last - who in addition to being DWP Director General, Human Resources is also (the first) Head of Government HR Operations.  In the mini blurb on his page it goes on to say that - and this is of course something worth boasting about -

Chris has transformed HR into a smaller, more professional service.

which is surely "a good thing" and yet .....

He introduced a graduate entry programme for HR and now the Civil Service is the largest recruiter of HR graduates in the UK.

Er, say no more ....

A couple of notable absences, methinks...

Via Bob E from the BBC:

Viewpoints: The civil service and reform

Nick Herbert, former minister of policing and criminal justice: "Whitehall Wars" makes for a good headline but a bad debate. I believe that the time has come to look again at our system of administration and consider the case for more radical reform...

Lord Bichard, former permanent secretary: Sadly the current debate about the civil service largely misses the point by focussing almost solely on the relationship between politicians and officials and whether it is at an all time low.

Dave Penman, general secretary of the FDA union: The civil service, like any large organisation public or private, is constantly reforming and adapting to respond to new challenges. The current government has tasked the civil service with delivering a radical reform agenda with significantly fewer resources. Already at its smallest size since the Second World War, the civil service is still only just over halfway through the job reduction programme planned to 2015, with further cuts to come beyond this date.

Peter Riddell, director of the Institute for Government: At the Institute for Government we have identified serious inadequacies in Whitehall that need to be addressed by both ministers and the civil service.

Alan Downey, head of government and public sector at KPMG: There are some specific reasons for the latest breakdown: for example, it is clear that a 30% reduction in the number of senior civil servants has cut deep into Whitehall's capacity, capability and morale. Yet, the problems underlying the recent outbreak of verbal hostilities have been brewing for many years. The last government's relationship with Whitehall followed a similar pattern: after a honeymoon period ministers began to complain about obstructive behaviour and the difficulty of getting their policy intentions translated into practice.

Yup, the BBC didn't ask Timmy Taxpayer or Joan Public what they think of all this, and none of the quangocrats interviewed even mentions them.

"1,000 office workers caught looking at stories about civil servants being sacked for looking at pornography while at work"

From The Daily Mail:

Hundreds of office workers have found themselves in deep trouble after surfing the internet for articles about the dozens of civil servants who have found themselves in deep trouble after surfing the internet for porn while they were meant to be working.

A total of 1,000 office workers in Wales read news items about a total of 55 workers at the Welsh Government's offices who were looking at explicit photographs and videos at their desks.

Disciplinary action was taken against the office workers after links to reports about discplinary action being taken against public officials showed up in their browser histories.

One senior manager was forced to resign after it was revealed in 2008 that he had read a story about a senior public sector manager who was forced to resign after it was revealed in 2008 that he had been looking at child pornography.

Two years later police were also called in when another worker, who was sacked, read an article about a bureaucrat, who was sacked, looked at illegal extreme porn.

Top employment lawyers are recommending offices ban articles about penpushers being sacked for surfing for porn because it's distracting office workers from their work.

Alex Salmond

Fun Statistic To Start The Week

From The Telegraph*

Retired civil servants drawing gold-plated taxpayer funded pensions now outnumber those employed in the civil service for the first time.

Official figures show there are now 17,000 more people drawing civil service pensions than are currently employed as civil servants.

The civil service pension bill has risen 30 per cent in just four years, and now costs the taxpayer £7.4 billion – a situation described by pensions experts as "unsustainable".

The escalating costs derive from substantial final salary pensions, retired people living longer, and the number of civil servants taking the option of early retirement.

Retired teachers could outnumber those in the classroom within the next three years, according to analysis of official accounts.

* Spotter's Badge: MBK.

Official: London & South East are overly reliant on public sector spending

One of the myths put about by the Home-Owner-Ists in London & the South East is that public sector spending cuts (to the extent there actually will be any) will reduce their house prices less than in 'the regions' because 'the regions' are overly reliant on public sector spending, i.e. that the proportion of public sector workers is lower in London & the South East.

Firstly, the ratio for London is the same as anywhere else: around one-in-four people are employed by the government or local councils (it might well be lower in the rest of the South East, of course).

Secondly, as today's Evening Standard explains:

Public sector wages in the capital are far higher on average than other parts of the country, just over £34,000 compared to slightly less than £26,000. Individuals who get more generous pay rises and are on the highest salaries are set to be the biggest losers from the reforms.

RMT general secretary Bob Crow warned: "The Hutton pension plans will hit public sector workers in London particularly hard because wages tend to be higher."

Jonathan Baume, general secretary of the FDA*, which represents senior public sector workers, added: "Clearly there is a big impact on London because of the concentration of public services."

So even if the ratio of public sector-to-private sector is slightly lower, average salaries are considerably higher (all the tens of thousands of Whitehall mandarins earning seven figure salaries), and the total amount spent is probably as much as anywhere else.

So there.

* Rather hilariously, if you follow the hyperlink in the article to the FDA, it cross references you to articles about the US Food & Drug Administration, and not the rather pretentiously named civil servants' lobbying group the First Division Association (who by rights ought to be called Premiership Association by now).

Fun With Numbers

Today's maths lesson is a from a lecture by Will Hutton:

"As you're no doubt all aware, I managed to wangle myself a job on the Lib-Cons' High Pay Commission, despite having been a Labour luvvie for the previous few years. My first idea was to set an absolute upper limit for civil service pay in £-s-d, so I chatted to a few people in Whitehall and some of my old mates running local councils or Primary Care Trusts and Trevor Phillips, who's on about £160,000*, and they explained to me that a) they weren't going to take a pay cut, b) if I did set a limit at slightly above what they were currently getting it would give the game away, and c) they reminded me how much I was getting paid and that a) and b) apply to me as well.

So back to the drawing board!

Now, of course, I see myself as a public servant first and foremost, I don't do it for the money. In fact, I'm not even sure how much I paid myself for my services to The Work Foundation last year. I tried checking on the Charities Commission website, but that just reminded me that we hadn't actually submitted any accounts for the year to 30 June 2009 yet. Ah well, there were some financial irregularities and so on, nothing the accountants can't sort out, although I'm surprised that those accounts are already 215 days overdue.

So I checked the accounts for the year before that, which have a handy little table on page 27 which shows that the highest paid employee paid him- or herself between £170,000 and £180,000. I'm not sure if that was me, but I'd assume it was. It can't have been Jean in the payroll department or Tony who fixes the computers. It's not Fumi, the nice Nigerian lady who comes in to empty the paper baskets and collect the coffee cups either, she's on something called 'The National Minimum Wage' (note to self - is it worth trying to wangle a job on Low Pay Commission? Doesn't sound very lucrative if that's all they get!) and she earns around £9,000 a year, or at least that's what Jean told me before she popped out for a cigarette (filthy habit).

Or maybe she's called Joan? I just can't remember...

Then little ol' Will had a brainwave! It came to me in a flash - thanks to decades of dumbing down, most people don't understand multiplication, but it happens that I am a dab hand with the old calculator. I idly tapped in £180,000 and £9,000 and a couple of other buttons - more or less at random - and it came up with the number twenty. Two-zero. 20. I got Tony to run it through the computer, just to check, and he confirmed that if somebody who is paid £180,000 is being paid twenty times a much as Fumi. Apparently £180,000 would make me a 'fat cat' or something, so I did a dry run and told a few people that I get twenty times as much as Fumi, and they just stared blankly.

Result! Twenty. What a beautiful, lovely round figure....

I tell you, he's a clever chap that Tony from the computer room. He told me that he's only paid £25,000 (I suppose he has a private income and does this for a hobby or something), so in theory, if I sacked Fumi and Jean (or Joan), he'd be the lowest paid person in the office, and then I'd be allowed to pay myself half a million squid without breaking the "twenty" limit. For that sort of money, I'll tidy up the coffee cups and run the payroll myself! I might give him a bonus for that insight... oh, great!

... so that's the story behind the number!

I hope you all enjoyed today's lecture, I'll be back next week with a quick run down of the practical application of differentiation and calculus, if anybody's interested."

* He's a cunning cove, my mate Trev. He's persuaded people that he only pays himself £112,000, but that's for a three-and-a-half day week. I checked with Tony in IT again, who confirmed that that's the equivalent of £160,000 for a five day week. My calculator must be broken or something, because it kept coming up with £6,400, maybe a key is sticking or something.

They couldn't run a sweet shop

To expand on the Kind Tooth Fairy/Wicked Tooth Fairy analogy, see bullet 2. of my earlier post, let me try and explain the sheer and utter deliberate stupidity of trying to claw back 45.8 pence from every £1 earned via the PAYE system and clawing back 44.2 pence via means-testing by using another analogy (which came to mind when I left the paper shop, having bought myself the latest copy of VIZ, a packet of Wrigley's Extras for the lass and some 'penguin cards' for the lad).

1. Let's imagine the Tooth Fairy (the DWP) runs a sweet shop and dishes out a fixed number of sweets to each person who visits the shop (the Universal Credit, or welfare payment). The price that 'customers' have to pay is 90 pence for every £1 they earn. It would be simple enough for the Wicked Tooth Fairy (HM Revenue & Customs, who man the tills and run security) to collect that when people 'leave the shop' (i.e. when your employer does the payroll), by asking employers to hand over 90 pence and to give the worker 23.8 pence. Workings below*.

2. The only opportunity for fraud is working cash in hand, and with such a high tax rate, it is hardly surprising that a lot of people do this; or even worse, people will simply not bother working. But this isn't good bad enough for the civil servants whose main aim in life is to keep the bureaucracy as bloated as possible, so they go one better:

3. The WIcked Tooth Fairy at the till takes 45.8 pence from you, and compiles long lists of which people 'owe' the Kind Tooth Fairy another 44.2 pence. The Kind Tooth Fairy then sticks these lists in a computer and tries to match it all up, and then sends its 'customers' a bill for the 44.2 pence at the end of the month or the end of the quarter, by deducting it from the sweet ration that the 'customer' gets in the next month or the next quarter.

4. The admin and faff involved will be stupendous of course, and the admin burden on the employer will go up by a factor of twelve - instead of just sending off one cheque for PAYE every month and then doing a PAYE summary once a year which breaks down the total PAYE and NIC deducted from each 'customer', it will have to submit all these lists every month.

5. And the bills for some customers - usually small amounts of tens or hundreds of pounds - will be delayed or lost, or they might accumulate and then after six months, the entire arrears will be deducted from future sweet rations in one go, long after the customer has assumed that is was all sorted out and paid for, thus leading to further hardship and write-offs down the line.

6. To cut a long story - if you were running a sweet shop, would you demand payment from your customers when they go though the till, or would refuse to accept full payment and just take half, telling them that they'll receive a bill for the rest at some vague unspecified point in the future, which will require the services of as many people again sending out the bills as you already employ manning the tills and running shop security?

* For £1 of wages, the Employer pays 13.8 pence NIC and the employee pays 20 pence basic rate tax + 12 pence NIC, assuming that the basic rate does not change and the Tories merrily press ahead with Labour's 'tax on jobs', which I have every reason to believe is the case. That makes 45.8 pence collected via the PAYE system.

The DWP then also reduce the worker's Universal Credit by 35% of their net wage after PAYE of 68 pence (£1 minus 20 pence minus 12 pence), i.e. by another 44.2 pence. So the net wage is 23.8 pence for every £1 earned.

The real enemy is the civil service

I printed off the DWP publication on their proposals for a Universal Credit, and a lot of it is to be welcomed, such as this on page 8:

Currently, when combined with tax and National Insurance payments, the withdrawal of Tax Credits, Housing Benefit and Council Tax Benefit can lead to Marginal Deduction Rates which are nearly 96 per cent, much higher than the highest rate of Income Tax... The combined effect of benefit withdrawal rates and additional tax as earnings increase is called the Marginal Deduction Rate and has the same practical effect as a tax rate.

Correct! It is to all intents and purposes taxation.

1. Let's imagine the Kind Tooth Fairy (the DWP) insists of giving every citizen a bit of money so that they don't starve, and has no method of clawing any of it back again (a bit like Child Benefit or the basic state pension); and the Wicked Tooth Fairy (HM Revenue & Customs) has to collect as much money as it can by deducting it from people's wages.

2. If the Wicked Tooth Fairy knows about the Laffer Curve, he would know that the revenue maximising rate on lower earners is about 60%, which he could arbitrarily split up into 12.8% from the Employer and 47.2% from the employee, call it 50% from the employee for sake of argument, which the Wicked Tooth Fairy would then ask employers to deduct from people's wages and send straight to him.

3. So the cash-cost minimising MDR is, by and large, the same as the revenue-maximising tax rate on the Laffer Curve, which sure as heck ain't 80% or so*.

4. The civil servants have deliberately spiked the whole point of the scheme by having a MDR of 65% or 76% (which I looked at yesterday), but, despite having admitted on page 8 that means testing is to all intents and purposes the same as taxation (in other words could be deducted straight from people's wages, to the extent they have any), they write this in the Executive Summary:

For those in employment, Universal Credit will be calculated and delivered electronically, automatically adjusting credit payments according to monthly income reported through an upgraded version of the Pay As You Earn tax system (on which HM Revenue & Customs will be consulting shortly).

The system will be simpler and will respond more quickly to changes in earnings so that people will not face the same complexities as they do now, particularly at the end of a tax year. As a result people will be much clearer about their entitlements and the beneficial effects of increasing their earnings by taking on more hours or doing some overtime...

This would involve an IT development of moderate scale, which the Department for Work and Pensions and its suppliers are confident of handling within budget and timescale.

AAAAARGH!!

5. How is that in any way better, or cheaper or less prone to fraud and error than simply giving welfare claimants £64 a week (or whatever the amount will be) and a PAYE code with no personal allowance, which tells employers to deduct 50% income tax and no back chat? The regular payments don't need to 'respond to changes in earnings', the claimant knows that he has £64 a week coming in (or whatever) and knows that for every £1 he earns legitimately, he will keep half.

6. And do you know what? We already have PAYE codes like this, they are called K-codes, it's all routine stuff that any payroll lady can handle (in fact, it's the easiest PAYE code of all to deal with, even easier than a BR 'emergency code' as the 50% covers both income tax and Employee's National Insurance.)

* Once Employer's NIC has gone up to 13.8% and Employee's NIC to 12%, for every £113.80 the employer pays out, a worker on the Universal Credit would keep £23.80, i.e. £90 makes its way back to the government, which is a tax rate of 79%. It's even higher if you add the VAT on top of the wages.

How many civil servants does it take to change a light bulb?

This article might give us a clue:

The EU farm subsidies system is a "masterclass of misadministration" in most of the UK, the head of the Commons Public Accounts Committee has said... Farming minister Jim Fitzpatrick has disputed figures showing average claim processing costs were £285 in Scotland, but £1,743 in England...

The National Audit Office said the current average cost of processing a claim in England was now £1,743. This is often much more than the value of the claim itself and is far more than the average of £285 under the simpler Scottish system. The report said that since the scheme's creation in 2005 it had racked up more than £680m in "unforeseen additional costs", including £304m in extra staff costs and £280m in penalties for late payments and administrative errors. It has also overpaid farmers an amount totalling somewhere between £55m and £90m.

Mr Fitzpatrick said they "did not accept" the NAO figures on claims costs... He said they had cut the number of administrative staff from 4,500 to 3,500...

Notwithstanding that these payments are straight subsidies to land ownership, and hence the worst kind of subsidies, is it too much to ask to at least process this reasonably efficiently? If we take 4,000 as the average number of civil servants involved and assume that there are 200,000 payments a year*, that means it takes a civil servant about a week to process one single claim. Once you take a week's inflated salary, plus gold-plated pension promise, overheads, fines, overpayments, late payment interest etc, the NAO's figure of £1,743 processing costs per claim seems perfectly plausible.

The basic idea is simple, its acres of land owned/rented x a fixed amount per acre, depending on what type of land it is. Of course, they've added on all sorts of complications (a landowner can sell or rent out land while retaining the right to claim the payments, for example) and transitional measures, and no doubt you can argue over whether something is woodland or grazing land etc, but that sounds like three or four hours work to me, seeing as the land-owner/occupier will be happy to point out why an award is set too low.

Now, does anybody know how many civil servants it takes to change a light bulb?

* According to The National Farmers' Union, in the UK "the number of full-time principal farmers fell very slightly, by 0.5 per cent, to 146,300, while the number of part-time principal farmers declined by 0.9 per cent to 196,800". Let's assume all full-time and half of part time farmers make a claim and that 5/6 of the resulting figure relate to England (being 5/6 of the UK population), gives us 203,917 claims.

The poison pill defence

This headline in Monday's FT caught my eye: "Tories search for cash to fund job cuts".

"Wot?" you may think, "Doesn't sacking superfluous public sector employees save money?"

Not necessarily. The problem is that these cosy and useless buggers are not at all cosy or useless when it comes to lining their own pockets, as the article explains:

... the cost of making civil servants redundant is creating “institutional overstaffing” in some departments, say Tory insiders, with the Treasury reluctant to provide cash for redundancy costs, even where that would produce long- term savings. At present, civil servants aged under 50 can receive up to three years’ pay if made compulsorily redundant, and those who joined before 1987 more than six years’ pay – terms vastly more generous than in the private sector... Even so, the large up-front cash costs are deterring departments from culling jobs, according to Philip Hammond, the shadow chief secretary to the Treasury.

I have heard stories about this, that a civil servant who takes early retirement can actually end up with much the same pay as one who continues working until retirement age (which is probably 60 for most of them), so it takes the taxpayer up to ten years to recover the cost of sacking someone.

So here's my cunning two-point plan:

1. There will always be jobs that need doing. So we can get these people out of the MoD and into the frontline; we can get these people out of the Department of Health and get them cleaning wards etc. That might well involve a pay down-grade, or else it'll be fun having some ex-public schoolboy/Labour luvvie* explaining to another squaddie/cleaning lady exactly why his pay is supposed to be twenty times hers. Hopefully that'll scare a lot of them off.

2. We (still) have a schedular tax system in the UK, and different types of income are taxed at different rates. Although I favour a flat tax system that taxes all income of whatever type - corporate or personal - at a single rate with as few exemptions and tax breaks as possible (not only is that more economically efficient, at least it's honest) but for people like this I'm prepared to make an exception.

So I'll introduce a sixty per cent higher rate tax on any salary, pension or redundancy payment paid by the taxpayer above the amount of £35,000 per year, which will claw back most of the cost, as well as encouraging more to move to the private sector where the flat tax rate will be thirty per cent and hopefully falling. That's probably a lot simpler than renegotiating loads of individual employment contracts and getting bogged down in private law disputes. The tax system is up to legislation and is not open to legal challenges (well, no doubt somebody will go for judicial review but they can f*** off).

If anybody has any more bright ideas, please leave a comment, this is all going in the MW manifesto.

* Delete according to prejudice.

'Labour quangocrat talks sense' shock!

That's the second one today, from the BBC:

Ex-trade minister Lord Digby Jones says he was "amazed" to discover how many civil servants "deserved the sack". He told a committee of MPs he thought the civil service could "frankly... be done with half as many" people.

H/t Hubbers

Public sector pensions

There are two ways of looking at the cost of public sector pensions.

One of them is to look at the total accrued liability as ably and entertainingly explained by Neil Record. His figure of £1,000 bn-plus is perfectly reliable but it's all a bit technical for a 'blog such as this.

The other, more simple way is to look at the current cost, and ask, if the government were a normal private sector employer, how much would it have to put into a pension fund every year to totally cover the future cash cost?

All this clever discounting that Neil Record does can fall by the wayside - you can safely assume that your salary will increase by 2% more than inflation each year, and equally that the appropriate discount rate to apply to future Government liabilities (i.e. those backed by the UK taxpayer) is about 2% above inflation, so let's ignore inflation/salary increases on one side and inflation/discounting on the other.

Right, let's take Teachers' Pensions. If you check the box for new joiners, you will see that after thirty years, your pension entitlement is exactly half your final salary.

Let's assume you start teaching at 25 this year and pack it in at age 55 (the minimum pension age, except in cases of ill health). By that time, your average life expectancy will be another thirty years, according to the Government's Actuary's Department . So really, you will be paid half as much again in retirement as you earn while you are working.

So a teacher on a nominal salary of £30,000 is really earning £45,000. OK, you could knock that current salary down by 6.4% to account for the deduction from the teacher's salary, but I doubt that this goes into the official statistics.

Right, let's assume that all the other civil service and public sector pensions are the same, this means that the true cost to today's taxpayer of the public sector is an extra 50% on top of the official cost of public sector salaries.

There are anywhere between 7 million and 8.2 million public sector employees, depending on whether you believe column E or column M of this, call it 7.6 million for sake of argument, on a median salary of £498 a week as at a year ago*, call it £508 as at today, makes total annual salaries £200 billion, so half again on that is £100 billion.

Each and every year.

To be paid by 30 million taxpayers, so that makes over £3,000 a year each.

In perpetuity. Because for every one that retires another one joins.

But that notional contribution of £100 bn doesn't go anywhere in real cash terms, it just gets put on the never-never. Turning back to Neil Record's actuarial approach, the net present value of an annual £100 bn liability discounted at 2% is £5,000 billion, or about three or four times gross domestic product. So his estimate of £1,000 bn is pretty much at the lower end.

* Scroll down to the very end of this - rather interesting is the fact that the median private sector salary was only £439 a week. Hmmm.