To think public sector pensions should be slashed?

Not all public sector jobs are low paid. My DS is on £30K in the public sector (school) for a job he’d probably get NMW for in the private sector.

It’s impossible to recruit in lots of local government areas as the pay is so poor in comparison to private sector. Reducing package by reducing pension isn’t going to make it easier to recruit. My area is staffed predominantly by women who can afford to work for lower wages as they have higher earning husband.

Yes but WHO are you going to ‘claw this back’ from? Do you feel like nurses are currently a bit overpaid? Do you feel like we don’t need so many bin men so it doesn’t matter that their salary and benefits are just so unattractive that no one will apply?

I work in a fairly cutting edge part of policy and just watched my boss’s boss manage a room of household name companies’ CEOs. I would estimate she is on about a fifth to maybe a tenth of what they are on. Her percentage of pay spent on her pension will be but a drop in the ocean to their bonuses, share options, travel and car allowances etc etc.

Here is a good example of something that affects a lot of us but is not related to anything I personally do:

Shortage of planning officials causes massive delays in building plans - can you imagine the billions of pounds not created in the economy in stalled housing and infrastructure projects because they just can’t FORCE people to become public sector planners? Or stop them from leaving for more lucrative inhouse jobs if, as you wish, their benefits are cut?

https://www.architectsjournal.co.uk/news/recruitment-crisis-leaves-planners-unable-to-exceed-minimum-duties

We are still tax payers and not every public sector department in the whole of the uk is paid the same, plus there have been recruitment/promotion freezes over the years so the possibility of earning more has been slashed. Its not all lovely little jobs with nice pensions

An argument I have read is it would be more expensive in the short term.

DB pensions so (current career average) pensions schemes are all pretty much in deficit. The government backed DB schemes all have a “golden guarantee” so aren’t regulated as heavily as other private sector DB schemes. So they generally use current contributions to pay out current pensions (PAYG funding method).

If they switched to DC pensions they’d then be forced to pay two sets of contributions:

• those into the DB scheme to make up the deficit
• those to current employees into their DC pension funds

So in the short term it’s more expensive so not something the government would consider.

You do realise that the staff pay into and fund their pension scheme with contributions each month?

Again, I'd rather see the eradication of in work benefits that top up some private sector profits by allowing those companies to pay the lowest wages possible while the state bridges the gap. Implementing that is difficult because of the immediate impact on those people receiving in work benefits but while we're making ideological statements that's mine.

If you have children, and want them to have teachers, then put that idea right out of your mind. Likewise if you want nurses should you ever be ill.

The vast majority of teachers could use their degrees earning a lot more in the private sector. Multitudes of them are already using that ability and leaving education. The pension is the only thing putting the brakes on for a proportion of them.

I have have two teachers and a nurse in my immediate family. All three are close to leaving. The security and pension are the only things holding them back at this point.

Yup...the pension is just about keeping me in the public sector...but only just. The wages aren't. Slash the pension and I'm off to do something more lucrative.

Ludicrous idea

I work for the LA and honestly my wage is a kick in the arse off minimum wage. It’s only the pension which makes it competitive. They put in 27%, I put in 10%. I suspect if they scrapped pension they’d have to raise wages. Also people having money in old age is a good thing as it helps pay care costs etc

And yes, they pay is much lower. Dh is well into the higher rate tax bracket and was looking at civil service roles but stopped when he realised how much of a paycut he'd need to take.

If we have a huge black hole, perhaps we should be looking at everyone paying a fair share rather than hammering hard working individuals whose package is clearly not trumping others or we wouldn't have an issue in hiring in a lot of the sector!

To that end, I think RR called it quite well in the budget although I'm sorry to have seen the balance of the burden then laid at the feet of businesses.

10 years of Tory rule has brainwashed too many in the politics of kicking our own, when the targets, once the majority of us have paid a fair share, really should lie elsewhere.

If you think our pensions are so great then why not come join us?

I'm sure you'll manage on a lower salary (about £10 less for my role type), whilst covering two jobs because there isn't the funds to recruit a second person, and all the stress that comes from dealing with vulnerable members of the public who are an absolute delight!

So the unfunded schemes (that are paid out of central government) are:

State pension
Civil servants (central not local)
Teachers
NHS
Fire service
Army
Police

www.actuaries.org/EVENTS/Seminars/Brighton/presentations/lewis.pdf

State pension dwarfs the rest.

Teaching and the NHS are notorious for their bad working conditions.

Its already very hard to attract students to study as teachers and healthcare workers.
Same with Social workers, Council planners and building inspectors.

So whilst you might wish to get rid of these more generous pension schemes, the reality would mean higher salaries or even more staff shortages in the public sector.

Who would pay for that?

I know averages hide a multiple of sins but the average local government pension paid is £4400 p.a.

I work for the NHS and am not entitled to claim my DB pension until I reach state pension age. There is no chance I'll still be able to do the job I do now by my late 50s so I'll likely move down a grade and drop my hours. That's what my pension will be based on. Believe me, I won't be living the life of Riley when I finally retire at at least 67 (though I expect that to be pushed back). All the while my pay whilst not terrible is far from amazing now, no bonuses etc. So actually the vast majority of my contemporaries working in the private sector are in a better financial position than me and will continue to be when they retire.

I do find it odd when you see threads on MN encouraging people in their late 40s /50s to take NHS jobs "you'll get a greet pension". How much do you think they'll end up with on the most up to date pension scheme without a full 40yrs of service?!

I think there needs to be a massive overhaul on public sector pay and benefits. The amount overpaid, underqualified management & senior management positions in all sectors is staggering, and I'm not talking nurses, doctors etc, the ones who we should be investing in. Its certainly still a job for life as you try and get rid of any underperformers, its almost impossible all the time the re-deployment strategy exists.

You’re completely misinformed. Public sector pensions are no longer based on final salary, they were all changed years ago to save the tax payer money. We don’t get inflation-based pay increases either.

I don't think there's anyone left on final salary pensions. I joined the CS in 2004 and they were no longer available our department then, anyone who had one in the early 2000s retired a long time ago. My employer pays in but I have also been paying into my pension for 20 years now, hopefully meaning I will need no extra state support when I do retire.

Also for a lot of those years I was in the lowest band which had pay of a few pounds more than minimum wage so yes, the years of 1-2% pay rises were harsh. And my pension was cut!

Also, everyone in the public sector also pays tax.

In my experience pay is a lot, lot less than private sector. My DH looked at a job going at our place, it was 30k less than he gets. Wanting the same experience, qualifications etc. Obviously no bonus or health care either. We get better holiday, more flexibility, but that's about it. Our offices are full of poorly paid women who stay for the flexibility (childcare), and are propped up by husbands in well paid private jobs.

We used to have greater job security but that's gone now too.

I've had one pay rise since 2010 that matched inflation. Otherwise lower than inflation or a pay freeze. The employer contribution is 5% so not out of step with private.

You’re talking nonsense. Public sector pensions are no longer the great final salary schemes. I’m in HE - ours went years ago. All my younger colleagues are on career average. No retirement before 67.

DH is in the private sector. He has private health cover at his level, discounts on his firm’s goods(major retailer) and an annual bonus.

Why not train to be a nurse and join the NHS pension if we have it so good...? Go on, we're desperate!!

Teachers moved from final salary to career average some time ago.

The transitions for this are not quick, it started in 2012 and finally closed in 2022.
Multiple legal cases over it as well.

As the article states, most teachers are worse off under the career average system.

www.unbiased.co.uk/discover/pensions-retirement/starting-a-pension/teachers-pension-scheme-everything-you-need-to-know

If you are looking at saving the government money this is not a quick fix.

I don't think there are any final salary schemes left in the public sector but I could be wrong.

Some of the public sector schemes - eg Lgps - are funded schemes so the employer puts in money and the trustees hold assets just like a private sector pension. Cutting the pension of lgps who have paid into it would legally be on the same level as forcibly cutting a company pension - and it would have no impact on taxpayers money because it isn't immediate taxes that pay for it.

www.gov.uk/government/publications/academy-trust-financial-management-good-practice-guides/local-government-pension-scheme-lgps#:~:text=This%20means%20that%20members%20are,is%20a%20'funded'%20scheme.