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Original poster

To think public sector pensions should be slashed?

664 replies

Monwmum · 14/11/2024 11:12

I'm probably going to be slated for even suggesting it....but in the private sector, high percentage final salary pensions were phased out in the early 2000s because they are a money pit and unsustainable. They were continued in the public sector as a sweetener because (apparently) public sector jobs were lower paid.

This simply isn't the case anymore. After years of frozen pay or meagre 1 or 2% pay increases in much of the private sector versus mainly regular inflation based pay increases in the public sector, this gap has been reduced if not closed completely. However, public sector pensions are still getting contributions of the high 20% figures while private sector pensions range from 4% -10%.

Quite a difference! Am I being unreasonable to say this would be a good place to start saving some of our tax money? And before people start saying there would be outrage just remember this was done to every private sector employee in the early 2000s so it can be done.

OP posts:
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9
RyderGangster · 14/11/2024 12:35

Ref calculations for wages, you have to take historical wage increases into account over time.

Example

One of my first jobs in the 80s paid £1.50 per hour

Minimum wage is now higher in the UK

SweetSakura · 14/11/2024 12:35

Monwmum · 14/11/2024 11:24

Ok I knew I'd get slammed. I think everyone is missing my point. Public sector jobs are paid for by all of us... including the pension contributions. And they are more than double those in the private sector so it just seemed a place where some money could be saved? You could still make them more competitive than private but cut them by say 25%?

Edited

The work I do brings in enough income to pay my salary many times over. By no means all jobs are publicly funded.

And that's my 15 minute lunch break over. (And I don't normally take one!)

TarantinoIsAMisogynist · 14/11/2024 12:35

Singleandproud · 14/11/2024 11:17

The vast majority of public servants aren't on DB pensions anymore. Yes, I get 19% put in by my employer and it is one of the reasons I decided to work for them but it isn't a race to the bottom. You are welcome to apply and become a member of the public service if you wish, every job has its perks and their downfalls you should take the employee offer into consideration when you apply for a job.

This isn't true. Most public sector pensions are still defined benefit. All of the big public sector employers I am aware of (civil service, NHS, teachers, councils...) still offer DB pensions.

They tend to be career average rather than final salary these days, and the terms are less beneficial than they used to be, but they are still DB pensions.

Bananamanlovesyou · 14/11/2024 12:34

Get your facts straight at least.

Tiker · 14/11/2024 12:34

What a vile goady OP!!! I am a Civil Servant. I contribute a fair amount to my pension and I expect a return for my investment.

When I was first interviewed for the Civil Service more than 20 years ago, they commented on the relatively low pay but explained the pension made up for it.

I have made a second career in the Civil Service. I have jumped through hoops to do training and serve the greater good. My job is not easy but I love it and I have fantastic colleagues.

When I worked in the private sector, I had relatively higher wages, lunches in Paris, parties and freebies etc as perks. I get nothing now not even free tea or coffee.

I do have decent working conditions and flexi time and when I retire, a reasonable pension but it won’t make me rich. I expect to work until my 70s. Most public sector get a few thousand a year. Hardly gold plated. I expect the Govt will eventually means test the state pension also.

whatkatydid2014 · 14/11/2024 12:32

MissScarletInTheBallroom · 14/11/2024 12:13

Yep. The pensions have already been slashed, and the salaries remain woeful.

Edited
Show quote history

True. I know no one at any other employer than mine (public or private) that has a final salary pension anymore. My employer stopped offering them to new hires over 20 years back (10 weeks after I joined and signed up). I’m sure there will be a few others like me on legacy schemes. I expected at the beginning the scheme would be wound up but at this point I think they’ll just let it run down as people retire. It’s a huge benefit and a big factor in my not changing jobs. Unlike the public sector pension my healthcare/teacher friends are on it’s also non contributory. It’s calculated as being worth 1/3 of my salary some years

SweetSakura · 14/11/2024 12:31

I could earn at least double my salary in the private sector and would walk in a heartbeat if they went for out pensions. So would the rest to my team. And replacements would be impossible to recruit so they would be left paying for very expensive locums.

Pleaselettheholidayend · 14/11/2024 12:31

Monwmum · 14/11/2024 11:22

I'm not advocating a race to the bottom but this is tax payers money being used ....we seem to lose sight of that? At a time when pensioners have had the winter fuel payment removed should public sector pensions really be more than double those of the private sector?.

If it was a stark choice between the two then surely pensions are a better spend of public money, especially if they are decently renumerated so people can pay their own bills without top ups.

If you were being really brave then you'd question the triple lock which is a HUGE cost on the public purse but you seem to just want to cause ill feeling towards public sector workers?

Butterworths · 14/11/2024 12:28

BarbaraHoward · 14/11/2024 12:26

lol, sorry - I read it too quickly! I thought you wrote 1/125 which is on me.

I've never seen 1/25 though, are you sure? You only needed to work 25 years to have a pension equal to your whole salary?

Show quote history

Yes I am pretty sure - but I will go and look it up. This was working for a NDGB in the mid 90s.

ETA - now wondering if I have misread it and it's been 125 all along! Will report back

saraclara · 14/11/2024 12:27

I'm glad you've heard us @Monwmum and changed your mind. Thanks for being open-minded.

My eldest DD left uni with a first, when the financial crisis hit She couldn't start the career she planned, so drifted into teaching, which she's exceptional at. However, she now earns way less than any of her equally academic and successful friends, by some margin, and is way more stressed. Losing the security and pension would be a massive kick in the teeth, and to be honest, she'd be better off and more mentally healthy working in Tesco if that happened.

BarbaraHoward · 14/11/2024 12:26

Butterworths · 14/11/2024 12:23

This isn't how I understood it at all - I thought that meant for that every year I worked (which for me was only 2 and on a crap wage) I got 1/25th of my salary as pension. Totally willing to accept I am wrong I don't understand the link between 1/25 and 62.5 years - is there a formula?

Show quote history

lol, sorry - I read it too quickly! I thought you wrote 1/125 which is on me.

I've never seen 1/25 though, are you sure? You only needed to work 25 years to have a pension equal to your whole salary?

AnonymousBleep · 14/11/2024 12:25

YABU. It's not a race to the bottom.

Butterworths · 14/11/2024 12:25

By the way my employer now contributes slightly less than 1% of my salary towards my pension but I get a 25% bonus which I chuck straight in most years. The whole package needs to be considered.

bloodredfeaturewall · 14/11/2024 12:24

GabrielFaure · 14/11/2024 11:17

People look at the whole package. Slash the pensions and you’d have to raise salaries to private sector level.

this

plus final salary pension means a percentage of the base element when the salary is made up of many elements.

Cornishbelle · 14/11/2024 12:24

Can I ask where you're getting those figures from OP?

Iamanunsafebuilding · 14/11/2024 12:23

@BarbaraHoward thank you for your post. I'm a public servant and somewhat shamefully I really struggle to get my head around pensions. People refer to a pensions pot and I knew I didn't have one but even though I went to a learning session I still didn't really understand why. Your post makes sense to me!

Butterworths · 14/11/2024 12:23

BarbaraHoward · 14/11/2024 12:04

Exactly - you would have needed to work 62.5 years to accrue an annual pension of half your salary (ignoring final salary vs CARE here for a second), where as PP on 1/49 would only need to work 24.5 years to have an annual pension of half her salary.

The old standard was 1/60, so after 40 years of service you would have a pension equal to two thirds of your salary. Or 1/80 but with a lump sum of 3/80 also accruing.

Edited
Show quote history

This isn't how I understood it at all - I thought that meant for that every year I worked (which for me was only 2 and on a crap wage) I got 1/25th of my salary as pension. Totally willing to accept I am wrong I don't understand the link between 1/25 and 62.5 years - is there a formula?

Brefugee · 14/11/2024 12:22

Monwmum · 14/11/2024 11:22

I'm not advocating a race to the bottom but this is tax payers money being used ....we seem to lose sight of that? At a time when pensioners have had the winter fuel payment removed should public sector pensions really be more than double those of the private sector?.

that is exactly what you are advocating though.

Jengnr · 14/11/2024 12:21

‘versus mainly regular inflation based pay increases in the public sector’

🤣🤣🤣🤣🤣

user1471556818 · 14/11/2024 12:21

Bjorkdidit · 14/11/2024 11:30

There's chronic staff shortages in many essential roles within the public sector, nurses, teachers, emergency services etc. Pay really isn't that great for professional graduate roles, typically around £30-50k with no bonuses.

You know, the sort of money that MN generally thinks is somewhere between 'a pittance' and 'not very much' while they're merrily talking about their 25 YO DC earning twice that in the private sector.

Do you think it's a good idea to make the chronic shortage of these roles worse by reducing the one part of the package where the public sector is more attractive than the private sector?

Also, if you think the public sector is more attractive, you can always apply to work there.

Show quote history

I started work in NHS Since 80s so yep my pension is one of the better ones . I managed staff for about 30 yrs ran wards , covered hospital sites as senior nurse.
Worked public holidays, missed so many breaks , finished late most shifts .No hoists nor manual handling equipment when I started , beds didn't even go up .
Ive stood in a bath with a welly boot on and lifted an adult out the bath with another nurse , that was the norm .
My back shoulder and neck are knackered
I earned every penny of my pension .
My 28yr old dn earns 2 x what I earned in my best Yr not including the bonus .

viques · 14/11/2024 12:21

I love the phrase “this is tax payers money being used” , as though not paying tax is something public sector employees manage to do without anyone noticing!

Retired but still a tax payer speaking, paying tax on my pension to support my former colleagues in the public sector.

knitnerd90 · 14/11/2024 12:20

The entire "Well it's tax money so we should underpay the civil service" argument is nonsense. It amounts to "civil servants should do it for love." Love doesn't pay the mortgage and the compensation package in the public sector needs to be roughly competitive with the private sector. otherwise you can't get decent workers.

Duckswaddle · 14/11/2024 12:19

You’re welcome to take a job in the public sector and find out.

Why is it that public sector workers get so slammed all the time? So many amazing people working all hours for peanuts, and your begrudging them a fairly decent pension, which is basically the only perk…

ladykale · 14/11/2024 12:19

Monwmum · 14/11/2024 11:24

Ok I knew I'd get slammed. I think everyone is missing my point. Public sector jobs are paid for by all of us... including the pension contributions. And they are more than double those in the private sector so it just seemed a place where some money could be saved? You could still make them more competitive than private but cut them by say 25%?

Edited

Fully agree!

If they were self
Funded I would have no issue but private sector
Pays for them!

ladykale · 14/11/2024 12:18

Singleandproud · 14/11/2024 11:17

The vast majority of public servants aren't on DB pensions anymore. Yes, I get 19% put in by my employer and it is one of the reasons I decided to work for them but it isn't a race to the bottom. You are welcome to apply and become a member of the public service if you wish, every job has its perks and their downfalls you should take the employee offer into consideration when you apply for a job.

Not a race to the bottom yes but private sector funds these bloated packages and as Labour keeps saying "money needs to be found from
Somewhere!"